“Following laws and regulations, in addition to adhering to responsible business practices, is critical for lawsuit prevention and any necessary defense to protect the HOA and the homeowner members.”


issues and trends in HOAs; use orderly and transparent business practices and procedures; and communicate effectively (and often) with the members of your HOA.


Additionally, every board member should take CAI’s board leader training certification course and the Orange County Regional


or bi-annually to become aware of the latest contracting,


Chapter’s HOA University financial, reserve study,


classes annually legal,


and insurance


requirements affecting common interest developments. It


Self Protection


While the courts tend to give great deference to board decisions, board members are held to a high standard as


fiduciaries


the HOA. must


acting on behalf of the members of In order to avoid personal


liability, follow the Business they Judgment Rule – acting


in good faith, in the best interests of the HOA, after making reasonable inquiries before making decisions. If board members are found to be acting in bad faith, it


Officers Insurance will protect them. Just because an HOA is a non-profit, mutual benefit


is not likely that the HOA’s Directors and corporation with


volunteer board members does not mean you’re exempt from following the law. As a volunteer board member, protecting yourself


and following the Business Judgment Rule will go a long way toward insulating you from potential HOA and/or personal liability.


Chapter Education Opportunities


The Orange County Regional Chapter of CAI provides excellent leadership training for board members and


www.caioc.org 27 through continuing education is not the community manager’s job to explain to


board members how and why to vote on an issue. Board member education is imperative for well-run HOAs.


homeowners. You will receive a good overview of each topic in one evening and obtain many reference materials. These classes are delivered in a four-part series, covering the following topics:


• Community Association Law


• Community Association Finances and Association Reserve Studies


• Community Association Insurance • Maintenance, Construction Contracts and Bidding


A regular bonus course is also offered presenting current insight into investing HOA reserve funds.


There are many other individual classes, seminars,


and monthly luncheons to keep you up to date on the latest developments in HOA business. If you are a member of CAI, many of these classes are free. If not, the charges are usually minimal and well worth the cost. Be smart – protect yourself and your HOA by making sure you understand the requirements of your job and then proceed to act in accordance with them. Make sure it’s a rewarding, as well as challenging, experience.


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