Directors & Officers

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Directors vs. Officers

There is often confusion about the difference between directors and officers in condominium and homeowner associations. Much of the confusion stems from the corporate world. In large corporations the board members of a corporation are often different individuals than the

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What Keeps Board Members Up at Night?

You can hear the clock ticking…you take a look at it and its 2 am! You just can’t fall asleep. Why? Your Condo Association had a very heated meeting tonight regarding roof replacement. The Board Treasurer wants to use the

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Do The Right Thing How To Avoid Personal Liability As A Condo Association Director

In Florida, the “officers and directors of the association have a fiduciary relationship to the unit owners.” F.S. §718.111(1)(a)  In its most basic form, a fiduciary duty is an obligation to put the interest of someone else above the self-interest

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Jury awards Panama City Beach (FL) condo association $12 million

A jury has awarded nearly $12 million in damages to the Shores of Panama Resort Community Association in a lawsuit against several former directors of the association.  Read the article……….

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Conflicts of Interest Within Your HOA

While it’s easy to forget, an HOA is a business. Like in all businesses, the people with the power (particularly the board members) can develop conflicts of interest, which can devastate the community.  Check out these three questions that can

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Housing Counsel: The Business Judgement Rule

Q: What exactly is the “business judgment rule”? I have a problem with my condominium board, and the condo attorney keeps referring to this as a defense. Can you explain?   Read the article………….

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Getting Results Award: HOA treasurer saves his neighbors thousands (FL)

HOA Treasurer John Tenuta is this week’s Getting Results Award winner.  Tenuta saved his neighbors thousands when he noticed an accounting error on their books     Read the article…………..

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Delray (FL) associations get a leg up on liabilities

The Alliance of Delray meeting last month at the South County Civic Center featured attorneys Peter Mollengarden and Mark Keegan providing legal information regarding liabilities of community association boards.    Read the article………..

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6 Tips to Avoid D&O Liability Claims

In today’s electronic world, informality is encouraged on Facebook, email communications, texting, etc. But, when informality creeps into Board proceedings for Homeowners’ Associations (HOA), it can lead to major disputes and problems that result in liability claims. Based on our

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California Court Considers Reimbursement of Legal Fees Under D&O Policy

In its recent decision in Clark v. Travelers Cas. Ins. Co. of America, 2015 U.S. Dist. LEXIS 114877 (C.D. Cal. Aug. 28, 2015), the United States District Court for the Central District of California had occasion to consider when an

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Kentucky Court Holds D&O Policy Not Triggered By Suit Against Condo Board

In its recent decision in State Auto Prop. & Cas. Ins. Co. v. Highland Terrace Counsel of Co-Owners, Inc., 2015 U.S. Dist. LEXIS 59663 (W.D. Ky. May 7, 2015), the United States District Court for the Western District of Kentucky

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What Does this Thing Called Fiduciary Duty Mean for HOA Board Members?

As a new or current HOA board member you may often hear terms that you’re unfamiliar with. It’s important to ask questions and stay educated when something is unclear, and nothing can be more convoluted than financial jargon.  From time

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Protecting Self & Staff: Don’t Skip the Liability Coverage!

Ahhh, lawsuits. People suing people. Companies suing companies. People suing companies. Residents suing boards. A quick surf of the Internet and you can find many instances across the country where condo boards are sued. You can also find multiple lawsuits

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Directors’ Bankruptcy Does Not Relieve D&O Insurer of Obligation to Defend

The bankruptcy of insured directors did not relieve the insurer that had issued a directors and officers (D&O) endorsement to a commercial general liability (CGL) insurance policy of the obligation to defend or indemnify them, even where they had been

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Board Owner Do’s and Don’ts: What Makes a Board Successful

It only takes a few minutes of a web search to uncover the traits that make a successful person or business owner. For example, Entrepreneur magazine’s Steven Key wrote the article, “5 Qualities of Successful Persons,” which included such traits

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How to Avoid Getting Sued as a Board Member? Take These Five Steps.

Defending your cooperative or condominium association in a lawsuit can be costly and time-consuming, and may hinder your board’s ability to function effectively. Your condo or co-op board of directors is required to respond and defend the association in all

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HOA HOMEFRONT: New Year’s Resolutions Part I — The Director

This time of year so many of us make resolutions to start the new year differently. In this three part series, I suggest possible resolutions for the association director, homeowner and manager. As part of my homeowners association (HOA) board,

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How to avoid condo board breakdowns

When a condominium community goes to war, everyone loses. The owners lose trust in the board of directors’ ability to manage the condominium. Necessary repairs go undone. Not enough money is collected to pay for future repairs. Nothing gets accomplished, and

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Annual Insurance Coverage Self-Evaluation

While we can anticipate certain risks that our communities are likely to face, and set aside reserves to cover the situation when the risk becomes reality, we still must rely on insurance as an essential risk management tool. What we can do to lessen

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Mississippi Court Holds D&O Policy Not Triggered By Real Estate Scheme

In its recent decision in State Farm Fire & Cas. Co. v. Anderson, 2013 U.S. Dist. LEXIS 57837 (S.D. Miss. Apr. 23, 2013), the United States District Court for the Southern District of Mississippi had occasion to consider coverage for

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Riverdale Peaks Homeowners Ass’n v. Auto-Owners Ins. Co

Riverdale Peaks Homeowners Ass’n v. Auto-Owners Ins. Co., No.11-cv-01920-WJM-MJW, 2012 U.S. Dist. LEXIS 54180 (D. Colo. Apr. 18, 2012) An exclusion for “liability based upon any intentionally dishonest or fraudulent act or any judgment based upon any intentionally dishonest or fraudulent act” contained

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Is the Honeymoon Over for Aussie Strata Committees? (Looking at U.S. D&O claims)

Australian strata committees have enjoyed a pretty benign life for the last 50 years. They haven’t had to do too much, mostly defer to owners meetings on key decisions, rely on strata managers for most day-to-day operations and have not

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Directors’ Duties

We frequently talk about directors’ “fiduciary duties” to their associations and their members. While CCIOA seems to say that non-declarant directors do not have a fiduciary duty (it says no director nor officer shall be liable for actions taken or

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What the Heck is D&O Insurance and Why is it so Important? A Primer on Board Member and Officer Liability Exposure

Directors and officers of an association are volunteers with enormous responsibilities, who put in countless hours to better their communities. Though directors and officers are appreciated by most of the community, they are sometimes blamed for their decisions and challenged

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Court ruling could increase liability of individual condo, co-op board members

New Yorkers may become even more reluctant to sit on the board of their condominium or co-op building. A decision handed down by the state appellate court this month could increase the likelihood that individual board members will be held

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Governance Guidelines

There are basic expectations that apply to virtually any common-interest community. With this in mind, the Center for Community Association Volunteers developed the Community Association Governance Guidelines – 12 principles that can help association board members increase harmony, reduce conflict

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Model Code of Ethics for Community Association Board Members

This model code of ethics is not meant to address every potential ethical dilemma encountered by a community association board member, but is offered as a basic framework that can be modified and adopted by any common-interest community.    Read

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So Now You’re On the Board

The first steps to superior board performance are clarifying your board’s job and then following through with appropriate plans, actions and evaluation of results. The checklists presented here are intended to assist you in those tasks. They cover a significant

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