As a new board member, you’re likely enthusiastic about starting off on the right foot. Being involved and creating a positive influence on your HOA and its residents are something to be proud of. However, being a part of the board is complex as there are a lot of responsibilities and duties required. In addition to protecting your members and your association with a Ventura HOA Insurance program, heed the following advice for novel members.
Understanding the state laws and governing documents.
The CC&R’s and state bylaws need to be thoroughly read and understood before making any decisions within an HOA. In California, it’s referred to as the Davis-Stirling Act. Sometimes, HOAs run into issues when their state statutes conflict with the governing documents (or the CC&R’s). Therefore, it’s important to understand which one the law favors to prevent complication and expensive legal battles.
Managing common areas.
One of the main functions of most HOAs is the repair and maintenance of common areas and building exteriors. The maintenance responsibility for an association is established in the declaration or bylaws. In most associations, those parts of the property that are shared between the home owners are maintained by the association. Responsibility for those portions of the property over which an owner has an exclusive right to use or possess will fall upon the individual owner, explains Echo.
It’s very common for HOAs to face numerous requests for maintenance and repairs from homeowners. However, the HOA must be firm with the areas that are covered by them and which ones are the responsibility of the homeowner.
Upholding fiduciary duty.
The HOA has a fiduciary duty to operate, manage and maintain the association. Business judgment involves making rational, informed decisions in good faith. The board must strictly follow the law and its governing documents and apply and enforce them in a fair and uniform manner. The board must obtain and consider all of the relevant facts and circumstances, identify the various options available to the board, and carefully weigh which course of action would be in the best interests of the association and its membership as a whole, explains the article.
It should go without saying that board members should never act out of spite, prejudice, revenge, or self-gain.
Stay tuned for our next post where we will go over the second portion of important information for beginner HOA board members.
About Scott Litman Insurance Agency
At Scott Litman Insurance Agency, we are dedicated to protecting HOAs like yours. We have a unique understanding of the industry and the common risk exposures that you face in your daily operations. In fact, we find that 90% of the policies we review are missing coverages that violate the Covenants, Conditions, and Restrictions (CC&R), exposing the board, HOA and management to lawsuits – which is why our comprehensive policies are tailored to meet your specific needs at competitive prices. For more information about our products, contact our experts today at (818) 879-5980 ext. 201, or fill out our online form.