Berding | Weil - Attorneys At Law

"E" is for Efficiency

Delivering Association Budgets and Other Documents by E-mail

In our previous article in this series, “E-Delivery of Budget Packages,” Sandra Bonato described last year's amendments to the Davis-Stirling Act which allow community associations to deliver key documents to members electronically. Here we offer some practical and legal guidelines for an E-delivery program.

Is E-Delivery Right for You?

Before calling your association attorney to create an e-delivery policy, ask yourself if e-delivery is right for you. To use e-delivery, managers must keep accurate electronic records with a computer system capable of handling e-delivery requirements. The ability to scan1 sensitive documents such as budgets and other financial materials is required.

Similarly, if a majority of your members are not computer literate, distrust electronic delivery, or simply prefer to receive a hard copy, then the time and expense of setting up electronic delivery for just those members who can utilize it may not be worth it. But if the membership currently doesn't support electronic delivery, educate them. It's efficient and it's fast.

If you're ready to take the plunge, congratulations! Read on for more particulars to get you started.

Start with a Policy

Even though the Davis-Stirling Act authorizes electronic delivery of certain listed documents, your association Board of Directors should obtain and adopt a specific e-delivery policy. Your association counsel can insure that your policy meets the requirements of the statute. A written policy also insures that present and future board members have a template to follow. The policy should clearly lay out the association's legal responsibilities for communication, disclosures, and education of owners and residents.

Approve the policy and then decide on the details.

Choosing Your Preferred Method of E-Delivery

There are two basic ways in which to transmit documents electronically: (1) E-mail to members, or (2) a secure website.

If the Association's website is password-protected then creating a document depository is an easy choice. An additional benefit is that the website becomes a library of important documents which members can access at their convenience.

If a secure website isn't available or your members simply prefer getting their documents directly, then e-mail will work. Just remember, the documents need to be in read-only format to protect their integrity.

Owner Consent

There is one requirement of e-delivery which is absolutely essential: you must obtain the written consent of owners to accept electronic document delivery prior to delivering documents. We recommend a written explanation of the new law, the hardware and software requirements for accepting delivery, the particulars of your e-delivery system, contact information, a place for owners to submit their preferred e-mail address(es), and information pertaining to opting out of the e-delivery system once an owner has signed up for it. That information is not only helpful, it is essential. Why? Meaningful consent cannot be given without an understanding of what is being agreed to. Written consent is an absolute requirement of the statute which authorizes delivery of association documents by electronic means. If you do not obtain prior written consent of each individual owner, you cannot rely on electronic delivery of documents to that owner. Anyone who does not specifically consent to electronic delivery must still receive documents in hard copy by mail. In order to prevent confusion, we do not recommend any electronic delivery of documents to owners who have not consented to electronic delivery.

Essential Records

Currently, you probably keep records of owners' contact information as well as copies of all communications sent to the membership. Electronic delivery does not relieve you from these responsibilities. Indeed, in addition to the records you already keep, you now will have to obtain and keep on file owners' e-mail addresses and their written consent to receive documents electronically. Further, you should add the association to your e-mail list. When you receive that e-mail you will have some evidence that your electronic mailing was successful. Create an electronic file for your delivery records along with a paper backup.

Privacy, Safety, and Good E-Mail Practices

Finally, a few words about internet security. We've all heard the horror stories about hackers, mistaken distribution of private documents, altered documents being widely distributed, and other judgment errors resulting in everything from embarrassment to significant legal liability.

First, if you have a website, it must have a secure, password-protected area which is accessible only for members if you are going to use it for electronic delivery of sensitive documents. You have to check the website regularly to make sure that it remains secure. If you are not a skilled webmaster, you need to have someone else do that.

Secondly, do not forget that e-mail is not casual — the equivalent of a few spoken words; it results in a written record which can be forwarded infinitely and publicly. It is also admissible as evidence in the unhappy instance of a court proceeding. This bit of advice applies to every aspect of an association's business, not just to the transmission of documents. Do not send anything by e-mail that you wouldn't post in public or shout from the rooftops. Proofread carefully and definitely think twice before hitting “send,” especially if you're sending to hundreds of people.

Third, all documents must be in read-only format. Do not send anything to the membership in its original Word, Excel, or other format which can be modified by the recipient. It is vital that documents be sent in a format which cannot be changed and re-distributed.

You're On Your Way

Congratulations! By using electronic delivery of key documents, you can help your association communicate more effectively and efficiently and save a lot of trees in the process.

1 Or, in the alternative, using .pdf or other read-only formats.

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2175 N. California Blvd., Suite 500 | Walnut Creek, CA 94596 | P: 925.838.2090 | F: 925.820.5592
©2018 Berding | Weil LLP. All Rights Reserved