Wednesday, December 10, 2014

Well Driven

This is the seventh in a series of postings providing a detailed look at the governing documents for homeowners associations (HOAs).  Our final focus of the Bylaws is on Board duties and responsibilities. 

Just how dysfunctional can a Board become?  Several years ago, a dog was elected to serve on one community’s Board of Directors.  Go ahead and GoogleBeatha Lee’!
The underlying problem is that the Board is often composed of volunteers with limited experience and knowledge.  The result is that many of the basics, such as using Roberts Rules of Order to run productive meetings, are completely overlooked.  There is also very little understanding about the roles of Board officers, with each person ‘making it up as they go along’.  Phrases like ‘Fiduciary Duty’ may not even be on their radar.

None of us would permit an untrained person to drive a car, and it should be no different when placing someone in the driver’s seat of the Association’s business.  However, the disaster of a car accident is immediate and physical, while a poorly driven Association takes longer before the ‘impact’ occurs.

Compounding the problem are Board members who have been ‘cruising’ or are actively destructive or self-serving in their behavior.  You wouldn’t let someone take a ‘joy ride’ with your personal finances, and yet essentially this is what occurs in some Board settings.    
To tighten control, consider amendments that:

Permit more reasons for removal of Directors.   Normally, the only situation that allows removing a Board member is three consecutive unexcused absences.  Sometimes, but not always, he/she can be removed after becoming delinquent on paying assessments.  Barring these reasons, the entire community faces the arduous process of calling a special meeting to vote the person off of the Board.  For the effort involved, everyone decides to just wait it out until the person’s term expires.  A lot of damage may occur over the year or two until the next regular election for that position. 

To deal with a wayward Director, consider providing these additional triggers for removal:
  • If the Director misses four meetings in a year, no matter the reason
  • If he/she takes actions on behalf of the Association beyond the scope of authority and without the consent or knowledge of the other Board members
  • If the person is so contentious as to stymie the Board from conducting ordinary business.  This may require some level of court action.

Require Education/Certification. Mandate that education occur within 90 days of a new member joining the Board, and that each Director signs a statement affirming:
  • He or she has read the Association's Declaration, Articles of Incorporation, Bylaws, and Rules & Regulations
  • He or she will work reasonably to uphold such documents and policies to the best of his or her ability
  • He or she will faithfully discharge his or her responsibilities to the Association and the Association's members.

Follow this up with the requirement of continual education courses each year, and a provision for temporary suspension from Board service if these directives are not met.

Insist on a well-educated Board to steer your community along the proper path.

Be sure to share a comment below about this latest series of postings! We'd love to hear from you

1 comment:

  1. If you are a new net user afterward you need to visit constantly this web page and read more the updated posts at same here.useful source