As a former member of a retirement system BOD, I know what fiduciary responsibilities are and how they relate to a large pension fund. Of course, those of a BOD of an HOA would differ but the question brought forth whether we should we pay next years maintenance fees is an important one considering that the resort may go into bankruptcy, be put up for sale or not able to fulfill the use of the week we paid for. Certainly, communications from the BOD as to why the vote was postponed is common sense. The BOD along with Wyndham knows a lot more than we, the owners, do and are keeping us in the dark. The excuse of waiting until a legal action is resolved is not valid as this could take years of appeals, etc.
Here is a list of fiduciary responsibilities enumerated on:
https//www.hoamanagement.com/fiduciary-responsibility-of-ho; a-board-members/
1. DUTY OF LOYALTY (DUTY OF GOOD FAITH)
Duty of loyalty requires
HOA board members to act in good faith to promote the best interests of the entire association. HOA board fiduciary responsibility prevents board members from making decisions to further their personal interests. Board members must also avoid an HOA board of directors conflict of interest. This includes choosing a family-related vendor or voting on issues with a bias.
2. DUTY OF CARE
Duty of care
requires HOA board members to make informed decisions regarding HOA matters. However, corporate law acknowledges that board members are constantly faced with countless decisions and it is impossible to thoroughly review information related to each decision. As such, the board of directors can rely on other people such as an HOA manager or staff to provide the information necessary to make a decision. However, the HOA board of directors is still responsible for making the final decision.
The duty of care board of directors is expected to uphold can apply to several situations, including imposing fines on homeowner violations. An HOA board member must first make sure that he/she is up-to-date on the association’s rules and regulations. You can’t simply fine a homeowner for doing something that you don’t like. HOA boards must follow the protocol for fines, which is clearly outlined in the bylaws.
3. DUTY TO ACT WITHIN THE SCOPE OF AUTHORITY
In this third component, board members are required to only act within the scope of their authority. They cannot act or make decisions on matters that are outside the boundaries of their roles and HOA responsibilities to homeowners. HOA board members must read their governing documents to educate themselves on the limitations of their authority.
Board members must also know that
governing documents do not supersede local, state, and federal laws. As such, a community that prohibits pets cannot refuse a homeowner with a disability who has a service animal. A board member who rejects the disability needs of the homeowner is acting outside the scope of authority because he/she is already violating the
Fair Housing Act.
Hope this helps. What are your thoughts as to whether this BOD members have fulfilled their duty?
