received. Permission to send notice electronically is revoked if electronic transmission fails two times consecutively.


Emergency Powers The Act includes a new section on emergency


powers that allow the nonprofit corporation to act after a catastrophic event should a quorum of the board be unable to be assembled. A catastrophic event is a sudden, natural, or man-made situation where rapid change or destruction has occurred that has limited normal functions in daily living including communications and travel.


The Act allows the directors who are available to operate and take corporate action without a quorum.


The Act allows the directors who are available to operate and take corporate action without a quorum. Acts taken in good faith during a catastrophic event will bind the corporation and cannot be used as evidence of director liability.


Ultra Vires Actions The section on Ultra Vires actions of the board has


been rewritten. No longer can a member of the corporation bring a claim that the corporation acted without authority. Rather, the power of the corporation may be challenged only in a proceeding by the corporation, directly or through a receiver, trustee or other legal representative against an incumbent or former director, officer, employee or agent of the corporation.


No longer can a member of the corporation bring a claim that the corporation acted without authority.


Corporate Records Similar to the various acts that regulate community


associations, the Act specifies which records a corporation


must keep, including minutes of all meetings of the members and the board, records of all actions taken by unanimous consent, all committee records, the articles and the bylaws of the corporation, all communications with members that are in the form of a record for the past six years, a list of the names and business addresses of directors and officers, the corporation’s annual report, appropriate accounting records, and a record of all members including their names and addresses and the number of votes each member has.


Member Right To Review Like the various community association acts, the Act


provides that all members have the right to review corporate records. However, there are a few more restrictions on nonprofit corporation members. The member must deliver an executed notice in the form of a record to the corporation at least five days before the date on which the member, or the member’s agent such as an attorney, seeks to review the records in which the member describes in detail the records they want to review. A member seeking to review records must be acting in good faith and for a proper purpose, and the records they seek must relate directly to that purpose.


A member seeking to review records must be acting in good faith and for a proper purpose, and the records that they seek must relate directly to that purpose.


The corporation may put reasonable restrictions on the use to which the member may put the records. The following records may be withheld: (1) attorney-client or work product records, (2) confidential addresses, (3) records that would cause harm to the corporation by their disclosure such as disciplinary proceedings, job applicants, strategic acquisitions, and (4) records required to be kept confidential by law or by agreement with a third party.


The Act makes clear that records may be provided in electronic form. If records are provided in a tangible format,


Continued On Page 20  wscai.org 19


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36