Imagine that your building's sponsor has planted a friend or business partner in one of the units he owns in the building.
This shareholder then decides to run for a seat on the board and with the help of the sponsor, wins. In addition to any sponsor held seats already on the board, the sponsor now has an additional ally and is closer to gaining control of the board and possibly swaying key decisions for the building in his favor.
This may sound like an extreme way to rig an election but it is conceivable. So how does a board make sure that the annual election is honest and that no one is trying to tamper with the outcome? The first and easiest way is to understand the voting process that takes place in your building. The next step is to monitor each step of that process to make sure that everything is done correctly. There are even companies that specialize in handling board elections that can come in and guarantee an honest election
Most co-op and condo buildings use one of two types of voting: straight and cumulative. Straight voting is the simplest and easiest type of voting. Say you own 100 shares of stock in the co-op corporation or common interest allocations in a condo association. If there are seven seats to be filled on the board, you can vote the full 100 shares for each of the available seats, casting a total of 700 votes. In cumulative voting, which only occurs in co-ops, you can distribute your 700 votes however you want. For example, if you really want one person to win, you can cast all 700 votes for that person, which would obviously stack the scales to his advantage.
Robert Kraus, an attorney at Rosen & Livingston, points out that, If cumulative voting is not mentioned in the Certificate of Incorporation, cumulative voting cannot exist. If cumulative voting is held when the Certificate does not mention that it exists, the vote can be challenged by any one group of shareholders, who will always win in court.