P U S I M R E T R U YO Maximum and minimum terms for board directors, and pros and cons of staggered versus concurrent appointments.
BY TYLER KERNS, ESQ.
A
director’s “term of office” refers to the period of time for which he or she is elected to serve on the board of directors. When preparing for an association election, it is important to understand the term of office for the directors of the particular association and some of the issues that can arise relating to terms of office. Provisions regarding terms of office for directors are typically found in an association’s bylaws. However, an association’s articles of incorporation may also include a provision regarding director terms of office. If there are no provisions regarding terms of office in either the bylaws or the articles of incorporation, it may be worth taking a look at the CC&Rs (in particular, older CC&Rs sometimes include provisions that would more appropriately be included in bylaws). If an association’s governing documents are silent as to director terms of office (which would be very unusual), Corporations Code §7220(a) provides that the default term of office is one year. Corporations Code §7220(a) also provides that the maximum allowable term of office for directors is four years. STAGGERED OR CONCURRENT TERMS Terms of office may be concurrent or staggered. Concurrent terms of office mean that all directors’ terms expire at the same time. As such, at every election, the entire
4 The Law Journal Summer 2021 | cacm.org
board is up for election when an association’s directors serve concurrent terms. With staggered terms of office, on the other hand, the terms of office of different groups of directors expire in alternating years. For example, with a board consisting of five directors serving staggered two-year terms, if two directors are up for election every even-numbered year, then the other three directors would be up for election every odd-numbered year. Staggered terms can be advantageous because they ensure that at every election, there will always be one or more directors (depending on the size of the board) who will remain on the board with knowledge of any ongoing issues that the association is facing at the time. Concurrent terms of office are most commonly for one year, and staggered terms of office are most commonly for two years. Accordingly, most associations hold director elections every year as part of their annual meeting of members. As discussed above, depending on whether the association has concurrent or staggered terms of office for directors, either all or some of the seats on the board of directors will typically be up for election each year. However, some associations have concurrent director terms of office that are longer than one year, and in
