What is a notice of proxy distribution?

Under Hawaii Condo Law (HRS §514A-82(b)(4)), if the Association uses Association funds to distribute proxies, it must first post notice of its intent to use association funds to distribute proxies at least 30 days before the distribution. The notice must be posted in prominent locations on the project. Owners have 7 days after posting of the notice to request that their proxy solicitation statement be included with the Association's distribution of proxies. Under Hawaii Condo Law (HRS §514A-83.2(c))the Board or any Board member is prohibited from using Association funds to solicit proxies, although they may respond to the notice of proxy distribution like any other owner. There are a number of misconceptions about the statute:

• The notice applies to distribution of proxies not the solicitation of proxies. The law was changed to apply to distribution of proxies rather than solicitation. If the Association uses Association funds to distribute proxies including enclosing the standard form proxy with the notice of meeting, it must first post the notice.


• There is no legal requirement that the Association distribute proxies. Although it is unlikely that the meeting would meet the quorum requirements, the Association could legally send a notice of the meeting without a standard form proxy. For some associations where everyone is distributing their own proxies, this may not be a problem.


• Since the statute refers to "prominent locations," the notice should probably be posted in at least two locations.


• While the statute provides that those timely responding to the notice can include a 100 word statement to be sent out with the proxy distribution, Associations through their Boards can permit longer statements provided it treats everyone the same. Under the Recodification, the 100 word requirement will change to a single side of an 8½ x 11 sheet of paper.