Censure, noun. An official condemnation, reprimand, or expression of adverse criticism, usually by a legislative or other formal body, of the conduct of one of its members or of someone whose behavior it monitors. Webster's New World Law Dictionary, Wiley Publishing, Inc., Hoboken, New Jersey.
Purpose of Censure. A censure is not a disciplinary action. Instead, it is the reprimand of a director for misconduct. If rules were violated and fines could be imposed, action against a director would qualify as a disciplinary proceeding requiring a noticed hearing and the presentation of evidence. A censure, as noted below, can be imposed immediately by motion and vote of the directors if, for example, the bad behavior occurred in a board meeting. Behavior worthy of censure includes, but is not limited to:
Approval of Censure. If after repeated warnings a director persists in behaving badly, the board can immediately censure the misbehaving director.
[I]n any case of an offense against the assembly occurring in a meeting, there is no need for a formal trial provided that any penalty is imposed promptly after the breach, since the witnesses are all present and make up the body that is to determine the penalty. (Robert's Rules, 11th ed., p. 646.)
Ethics v. Carrigan “supports a broad understanding of inherent legislative authority to sanction based on a member's speech.” (Page v. Tri-City Healthcare Dist. (S.D. Cal. 2012) 860 F.Supp.2d 1154, 1171.)
In other matters where a censure may be appropriate, a noticed hearing should be called. In either case, the censure is recorded in the minutes. The minutes should reflect the reason for the censure.
Powers Unaffected. While expressing strong disapproval of a director's behavior, a censure does not remove a director from the board nor does it impair the director's ability to attend meetings, make and second motions or vote on motions, unless there is reason for recusing the director from a particular vote.
Removal from Office. If the errant director is an officer (President, Vice-President, Treasurer, Secretary, etc.), he/she can be removed from office by fellow directors. However, the director cannot be removed from the board except by:
Request for Resignation. In addition to censure, a board can request a misbehaving director's resignation. However, the director can refuse. If he/she refuses, the board's ability to remove a director is quite limited. This is also true for the courts. Courts may remove directors from office but only for fraudulent or dishonest acts or gross abuse of authority or breach of duty. (Corp. Code § 7223.) The membership, however, can remove a director with or without cause by means of a recall election.
Recommendation. Boards should adopt an ethics policy for directors, committee members and managers.
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