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Maryland Governor Signs Legislation Permitting Closed Condominium Board Meetings To Discuss Business Transactions

Governor Martin O’Mally has signed legislation passed by the Maryland Senate and House of Delegates that permits closed condominium board meetings for the purpose of discussion business transactions.  House Bill 388 and Senate Bill 197 were both approved by unanimous votes in each house of the Maryland General Assembly.  The new law amends Section 11-109.1 of the Maryland Condominium Act to provide that the board of directors of a condominium council of unit owners may meet in closed session for “consideration of the terms or conditions of a business transaction in the negotiation stage if disclosure could adversely affect the economic interests of the council of unit owners.”  The Governor signed the bill into law on April 9, 2013, and the amendment will take effect on October 1, 2013.

Presently, a condominium’s board of directors may meet in closed session for the following purposes:  (1) Discussion of matters pertaining to employees and personnel; (2) protection of privacy or reputation of individuals in matters not related to the council of unit owners’ business; (3) consultation with legal counsel on legal matters; (4) consultation with staff personnel, consultants, attorneys, board members, or other persons in connection with pending or potential litigation or other legal matters; (5) investigative proceedings concerning possible or actual criminal misconduct; (6) complying with a specific constitutional, statutory, or judicially imposed requirement protecting particular proceedings or matters from public disclosure; or (7) discussion of individual owner assessment accounts.