Proxy Rules
Paul McClintock, PRP, CP-T, www.paulmcclintock.com
Abbreviations:
RONR: Robert’s Rules of Order Newly Revised, 10th edition, Robert/Evans/Honemann/Balch, 2000.
PL: Parliamentary Law, Henry M. Robert, 1923, 1951.
DEMETER: Demeter’s Manual of Parliamentary Law and Procedure, George Demeter, 1969.
RIDDICK: Riddick’s Rules of Procedure, Riddick & Butcher, 1985.
TSC: The Standard Code of Parliamentary Procedure, 4th edition, Alice Sturgis & AIP, 2001.
Keesey: Modern Parliamentary Procedure, Ray E. Keesey, 1974.
Gondin: Dictionary-Handbook of Parliamentary Procedure, William R. Gondin, 1969.
Hills: Managing Corporate Meetings: A Legal and Procedural Guide, George Strough Hills, 1977.
Paul: Parliamentary Law: With Forms and Diagram of Motions, Nanette Baker Paul, 1908
Coggins: Parliamentary Law: Plain, sensible rules and reasons, for quick use in public meetings of all sorts, Paschal Heston Coggins, 1909.
RONR p.414-415: A proxy is a power of attorney given by one person to another to vote in his stead; the term also designates the person who holds the power of attorney. Proxy voting is not permitted in ordinary deliberative assemblies unless the laws of the state in which the society is incorporated require it, or the charter or bylaws of the organization provide for it. Ordinarily it should neither be allowed nor required, because proxy voting is incompatible with the essential characteristics of a deliberative assembly in which membership is individual, personal, and nontransferable. In a stock corporation, on the other hand, where the ownership is transferable, the voice and vote of the member also is transferable, by use of a proxy. But in a nonstock corporation, where membership is usually on the same basis as in an unincorporated, voluntary association, voting by proxy should not be permitted unless the state's corporation law - as applying to nonstock corporations - absolutely requires it.
If the law under which an organization is incorporated allows proxy voting to be prohibited by a provision of the bylaws, the adoption of this book as parliamentary authority by prescription in the bylaws should be treated as sufficient provision to accomplish that result.
RIDDICK p. 155-156:
If proxy voting is permitted, the president or credentials committee decides upon the validity of the appointed proxies.
Proxy votes are non-transferable, containing the name of the member transferring the proxy, the person to whom the proxy is granted, and the name of the person for whom he wishes the vote to be cast or the opinion desired by the transferring member.
The member holding proxies is also entitled to cast one vote as a qualified voting member in addition to the proxies.
The method of using [proxies] must be carefully spelled out to include…on which issues or candidates the proxy vote may be used.
Proxy votes may not be counted to make a quorum unless so authorized in the documentary authority [e.g., bylaws].
Sample Proxy
(Name of organization) .
I, (Name of member, unit of representation, if any) .do hereby appoint (Name of proxy) .to be my true and lawful attorney in fact for me in my name and stead to vote at
(Name and date of meeting) .for (Name of candidate selected) .for the office of President (or other candidates as have been nominated) (or for yes or no on a particular issue).
(Written signature of member) . Date ____________
TSC p. 147:
The proxy voter may cast one vote for each proxy held.
Directors or board members cannot vote by proxy in their meetings, since this would mean the delegation of a discretionary legislative duty which they cannot delegate.
A proxy may be in almost any form as long as its meaning is clear.
DEMETER p. 33:
"Proxy," short for "procuracy," from the Latin procuro (to attend to, to care for) is a form of voting, the voting being done not by the person himself who is entitled to vote, but by another person designated by him to vote in his place and stead.
Voting by proxy is not permitted and is not valid in ordinary assemblies (fraternal orders, labor organizations, women's clubs, veterans associations, etc.) unless the organization's charter, articles of association, certificate of incorporation, or its bylaws expressly authorize it.
[I]n the absence of his principal from the annual meeting of a business corporation, the proxy has the right to vote in all instances, but he has not the right to debate or otherwise participate in the proceedings unless he is a stockholder in that same corporation.
DEMETER p. 221-222:
[Sample, altered slightly] Proxy for Special Meeting
The undersigned hereby appoints _____ as proxy to vote on behalf of the undersigned at the special meeting of the Red Bluff Homeowners Association on mm/dd/yyyy, and any adjournments of said special meeting.
Dated: _______________________ Signed: ______________________________
No particular form of words is necessary to appoint or constitute a proxy, nor is it necessary to be executed with any particular formality, except where specially so required.
A person can confer on his proxy any power which he himself possesses.
[T]he person authorizing the proxy is bound by his appointee’s acts, including his errors.
A proxy in the usual, ordinary form confers authority to act only at the meeting then in contemplation, and in any adjourned meetings of the same; hence, it may not be voted at another or different meeting held under a new call.
When the appointer sends his appointee to a meeting, the proxy may do anything at that meeting necessary to a full and complete exercise of the appointer’s right to vote at such meeting. This includes the right to vote to take the vote by ballot, or to adjourn (and, hence, he may also vote on any other ordinary parliamentary motions, such as to refer, postpone, reconsider etc., when necessary or when deemed appropriate and advantageous to the overall object or purpose of the proxy.)
Revocation of proxy. [A] proxy only to vote stock may be revoked at any time, notwithstanding any agreement that it shall be irrevocable.
The sale in the meantime by a stockholder of his shares in a corporation…automatically revokes any proxies….
And a proxy is also revoked where the party giving it attends the election in person, or gives subsequent proxy.
PL:
[A proxy] should always be irrevocable, and therefore should be limited to a specified meeting and its adjournments. If it were not made irrevocable the maker could at any moment revoke it, and if this were done freely endless confusion would result. (p. 194)
The secretary usually sends…a printed proxy blank with the name of the proxy inserted, and a stamped addressed envelope for enclosing the proxy. (p. 195)
The proxy must always be witnessed. (p. 195)
Sample proxy, p. 564-565:
Know all men by these presents,
That I do hereby constitute and appoint Alvah Thomas attorney and agent for me, and in my name, place, and stead, to vote as my proxy at the annual meeting of stockholders of the Excelsior Manufacturing Company to be held Wednesday, April 12, 19__, at the company’s office, 322 Arnold Ave., Lonsdale, Nevada, or at any adjournment thereof, according to the number of votes I should be entitled to vote if then personally present; and also to appoint a substitute under him for like purpose.
In witness whereof, I have hereunto set my hand and seal, this __ day of ____, 19__.
Witness: ______________________ L. S.
Keesey, p. 138:
Unless specifically provided for in the bylaws of an organization, voting by proxy is not permitted; in the opinion of some, a deliberative assembly would be well advised not to allow it. The procedure conflicts with the basic principle of equality of membership.
Gondin, p. 103:
Proxy voting…
Is not in order unless specifically provided for in the organizations’ constitution or bylaws.
Persons granting the authority and those exercising it must both be voting members of the assembly in their own right. [But see 6th point under Hills.]
The authorizing document may be unrestricted, in which case the authorized member may cast the absentee’s vote ads he judges best; or, it may be restricted, in which case the absentee’s vote can be cast only in accordance with the instructions which he has given in writing on his proxy document.
Hills:
A person acting as a proxy for shareholders may not be a free agent. It has been held in a leading case that it is the duty of a proxy committee “to attend the meeting as well as vote the stock they represent.”
[Footnote: Duffy v. Loft, Inc., 17 Del. Ch. 376, 152 A. 849, 853 (1930). Rule 14a-4© of the SEC requires that the proxy statement or form of proxy provide, subject to reasonable specified conditions, that the shares represented by the proxy will be voted and that where the person solicited specifies by means of a ballot a choice with respect to any matter to be acted upon, the shares will be voted in accordance with the specifications so made.] – p. 504.
The right to vote by proxy is not a general right, but is a special right derived from some specific statutory provision or from the charter, by-laws, or other agreement among members. – p. 670.
Generally, every proxy may be revoked in whole or in part at any time before it is exercised. – p. 672.
A proxy may be revoked by the execution of a later proxy, by another writing, or by an appearance of the record holder at the meeting for the purposes of representing himself. A proxy is not revoked by the mere physical presence at the meeting of the shareholder who issued the proxy – for instance, when the shareholder is present to confirm rather than to revoke the proxy. – p. 672.
Since the relationship created by a proxy is one of principal and agent, it is subject to the duties and liabilities of agency in general. Thus the person designated in a proxy has a fiduciary obligation to carry out the wishes of the granting stockholders to the best of is ability. – pp. 673-674.
Although a proxyholder may be and often is himself a member or shareholder, he need not be; and a by-law attempting to so limit persons authorized to act as proxies is invalid. [Citation for this is a NY case when “a statute providing for an election by shareholders ‘either in person or by proxy,’ the shareholder is at liberty to select any person to act in whom he might be willing to confide the exercise of this privilege.” Thus a bylaw cannot impose a limit when the enabling statute has no limit.] – p. 674.
The extent of authority granted to a proxyholder depends upon the enabling provisions of the proxy instrument. A proxy that is general in form need not identify a specific meeting and may be used at any general or special meeting during the term of its validity. Also, a general proxy which gives the proxyholder all the powers the grantor would have possessed had he been present personally at the meeting authorizes the proxyholder to vote on a motion to materially change a proposed amendment to the corporate by-laws. – pp. 674-675.
However, where the proxy instrument limits the authority of the proxyholder to vote “at any election,” he does not have the right to do anything except to vote and to perform incidental voting functions. He cannot, for example, call a special meeting of shareholders as the power to call a meeting “cannot be implied from the general authority given to vote their stock.” – pp. 675-676.
Since the right to vote by proxy exists only by statutory authority and may be limited by the proxy instrument, the scope of permissible conduct of a proxyholder must depend on the clear meaning of the applicable statute and the proxy instrument. The primary purpose of a proxy is to delegate to another person the right to vote, and it is arguable that the proxyholder should be able to speak and perhaps to move on any proposition or subject on which he can cast a vote. But in the absence of a statutory or contractual extension of authority beyond the mere right to vote, the authority of the proxyholder to act ends at that point. However, it has been held that a proxyholder has the right, if requested by the presiding officer, to take the chair and call the meeting to order. – p. 676.
Generally, later proxies revoke earlier proxies from the same record holders. The court will confirm the findings of an election proxy committee in counting proxies where the committee acted honestly and in good faith. However, where a proxy contest is won by a slight margin due to the shifting of votes by the acceptance of later dated proxies, a court of equity might consider the circumstances sufficient to order a new election. – p. 677.
Paul, p. 166:
Voting by proxy is not permitted, except by some special rule, or by the unanimous consent of the assembly. When permitted, a committee should be appointed to receive and report on them.
The following is a simple form which will serve in ordinary societies: I hereby constitute and appoint Mr. A. to vote as my proxy at the annual meeting of the Literary Society, to be held on January the tenth, 1908, or any adjourned meeting thereof, for the election of officers, and upon such other questions as may properly come before such meeting. John Jones. January 2, 1908.
Proxies do not affect the question of quorum.
Coggins, pp. 121-122:
Proxies shall not be allowed at any meetings either of the club, the Board of Directors or committees, except that at a meeting of the club any member absent by reason of sickness or absence from the city may be recognized by proxy by unanimous consent of those present.
Questions:
Under RONR, where bylaws allow proxies but with no further rules for them,
A: Can a member “A” (holding the proxy from member “B”) make the motion as “A”
AND second a motion as proxy holder for “B”?
B: Can “A” speak twice in debate on a motion and twice more as proxy for “B”?
Are instructions (e.g., on how to vote) on a proxy form enforceable? How?
Can a proxyholder abstain from voting on a matter for which instructions were given?
Proxy Rules – Expanded from a 9/8/2007 WSAP Workshop by Paul McClintock. 2008-10-18