Why are HOA Volunteer Board Members Sued?

Volunteer board members are often baffled and incredulous when someone challenges or complains about a decision they made, a rule they changed, or a special assessment that was issued. The underlying problem here is unit owners not reading the governing documents they have agreed to comply with prior to purchasing their home in a homeowners association. In most cases, these unit owners probably do not read the governing documents until they have an issue with the board, the association or their neighbors. 

Practice Pointer 1: Read the governing documents before you buy. Ignorance of the governing documents is not a defense and an association member is presumed to have read the documents he or she has agreed to when they purchased their unit.

Practice Pointer 2: Each association member who wants to join the board should be required to confirm that he or she has read the governing documents before agreeing to become a board member.

Practice Pointer 3: Each board should hold an annual board training event, even for those who have served on the board before.  The value of an annual training far outweighs the cost, if any, as well as the effort.  Both items will lead to both monetary and time savings when the board knows how to operate the effectively. 

Practice Pointer 4:  A board member is not an employee. For example, if the board member says, “I have to do it, because no one else will.” There is a deeper issue that must be addressed, because a volunteer board member is not an employee.  If no one will step up, the board should hire a management company. If the board is not willing to do that, then the board should go to court and seek a receiver, which will end up costing the board and the association the money they did not otherwise want to spend.  At the end of the day, the board is charged with protecting the association’s assets and must take the steps to do so. 

In addition to understanding the role as a board member, the following will help simplify and shorten board meetings and mitigate claims.

• Be prepared. The single biggest waste of time in board meetings are board members who come unprepared and spend time getting up-to-speed during the meeting.
• Adopt a form of Robert’s Rules of Order and stick to them, even if board are close friends and the use of rules seems awkward. Rules should include a limited time for speaking by homeowners at a board meeting.
• Prepare an agenda. If there are items that are not on the agenda, they should be tabled for another meeting.
• Do not tolerate a lack of civility or an individual who insists on disrupting a meeting.  Do not engage that individual and adjourn the meeting to discuss further action with counsel. 
• Have open meetings to avoid any appearance of secrecy or conspiracy.

Understanding the board’s duties and obligations and making sure homeowners receive, read, and are able to ask questions about governing documents is the best risk management tool an association can use.

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