BOARD MEMBER RESPONSIBILITIES & THE RELIANCE ON EXPERTS


Stefan Richter, Esq., CCAL, EBP Clemons Richter & Reiss, P.C.


Recent events in Florida have illustrated how deferred action can potentially result in catastrophic and tragic consequences. Although an extreme example of how things can go awry, it is certainly not unusual to hear of boards and associations failing to identify, or deciding to postpone, significant repair work. As industry experts, policy makers, and legislators endeavor to create standards to help prevent the re-occurrence of similar disasters, board members and managers seek practical guidance on their obligations and liabilities.


The standard of care is well recognized. As codified in Sections 3303/5303 of the Pennsylvania Uniform Condominium (UCA) and Planned Community Acts (UPCA):


…[M]embers of the executive board stand in a fiduciary relation to the association and shall perform their duties, including duties as members of any committee of the board upon which they may serve, in good faith in a manner they reasonably believe to be in the best


interests of the association and with such care, including reasonable inquiry, skill and diligence, as a person of ordinary prudence would use under similar circumstances…


This standard applies to every officer and member of an association board, regardless of a community’s age. A board that is transitioning from the developer must thus meet the same standard as one of a forty-year-old condominium. The standard is relevant to every task and obligation imposed on a board by statute and the governing documents – this discussion will focus on the responsibilities to maintain, repair and replace common (and in particular significant or structural) components of the association.


Board members are not required or expected to have special knowledge or experience, or to be engineers, architects, contractors or lawyers. What is expected is that they exercise due care and reasonable inquiry – which essentially means that they must ask questions and


seek advice on matters outside of their realm of knowledge and expertise. The ability to obtain and rely upon such advice is also codified in 3303/5303 of the UCA and UPCA:


….In performing his duties, an officer or executive board member shall be entitled to rely in good faith on information, opinions, reports or statements, including financial statements and other financial data, in each case prepared or presented by any of the following:


(1) One or more other officers or employees of the association whom the officer or executive board member reasonably believes to be reliable and competent in the matters presented.


(2) Counsel, public accountants or other persons as to


(Connued on page 24) www.cai-padelval.org 23


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