HOA Duties and Responsibilities to Members

The Board of Directors (Board) of a Homeowners Association (HOAs) has a variety of duties and responsibilities with respect to homeowners. The state law in which the HOA is located sets forth these requirements. In addition, the various governing documents of the HOA, such as the bylaws and covenants, conditions and restrictions (CC&R) constitute the contract between homeowners and the HOA. The Board must enforce the provisions of these documents in governing the HOA, but also may adopt additional rules and regulations to enforce the basic tenets of the Association.

Fiduciary duties of the Board. The Board owes a fiduciary duty to homeowners to manage the HOA with the same degree of care that a reasonable person would exercise in similar circumstances. This obligation requires the Board to make business decisions in good faith using sound, prudent judgment. Thus, the Board must maintain objectivity when analyzing the facts, determining what is in the best interests of the HOA and applying the governing rules. Board members cannot act in their own self-interests under any circumstances.

Enforcement of the rules. The primary responsibility of the Board is to manage the HOA by enforcing the rules of the Association as provided in the governing documents. The Board must uniformly and fairly apply these standards to all HOA members, but has latitude to interpret its governing documents and supplement the rules if necessary. When the Board confronts a member for violating a rule (such as failing to pay an assessment), the Board may undertake various actions to obtain compliance, including verbal encouragement or legal action.

Maintaining the HOA. The Board is responsible for the repair and upkeep of the HOA. Common areas, such as shared facilities and landscaped areas, as well as building exteriors, must be maintained by the HOA. The Board determines which tasks require maintenance, the budget for making repairs, and how repairs and maintenance functions are to be carried out on both a routine and emergency basis.

Overseeing HOA finances. The Board is required to implement a budget and collect dues from HOA members. This task involves diligently examining the costs and expenses of the HOA operations in order to establish assessment fees. The Board must also determine when to levy special assessments and ensure that a reserve account is maintained.

Contact Shane Coons at 949-333-0900 or visit his website at www.ShaneCoonsLaw.com to find out more about his practice.

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HOA Duties and Responsibilities to Members

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