When board members find themselves faced with a conflict of interest, it can derail an entire association – that’s why it’s so important for board members to nip these types of problems in the bud before trouble begins.
The business judgment rule requires members of the board of directors to exercise ordinary and reasonable care in performing their duties to an association. This rule seeks to strike a balance between potential overdelegation on the one hand, and completely concentrated power on the other. Under the business judgment rule, a board…
Board members must carefully supervise individuals with whom the board has delegated authority. Board members are often found to be in conflict with the business judgment rule when they depend too much on association managers or other employees. An association’s declaration may limit the board’s authority to delegate by stipulating the duties that are and are not delegable and which board members have the power to delegate.
It is also essential for board members to act
News items of national interest regarding Condominium and Homeowner associations, compiled by the Community Associations Network