The Top Ten Most Common Fatal Mistakes Made by Community Association Directors and How to Avoid Them.
February 28, 2008
Community association directors don’t have an easy job. Besides not being paid, directors are increasingly facing tougher scrutiny and unfair criticism from legislators and homeowners. By avoid the following Top Ten Most Common Fatal Mistakes directors can make their jobs a little bit easier and a lot more enjoyable:
1. Not requiring two Board member signatures on all checks needlessly exposes an association to potential problems ranging from theft to fraud.
2. Allowing somebody other than a Board member to sign checks, such as a property manager.
3. Insurance, Insurance, Insurance. Failing to maintain “Officers and Directors Insurance” is a costly mistake.
4. Posting or publicly mentioning the names of homeowners whose assessments are delinquent needlessly exposes an association to lawsuits for violations of the various federal and State of Florida collections laws.
5. For condominiums, not maintaining a key to every unit for entry during emergencies can be very costly.
6. Officers and Directors that do not use a separate email address for their association business are making a costly and possibly embarrassing mistake. A director’s emails that contain information regarding association business are considered part of the association’s “Official Records”. Upon written request an owner can review these emails.
7. Officers and Directors that have a separate email address but still use their personal email addresses for association business, are needlessly exposing themselves to having their personal emails reviewed by an owner (see #6 above).
8. Adding late fees and/or administrative charges onto the delinquent account of owners, without confirming the association’s Governing Documents allow the imposition of these charges, needlessly exposes the association to a potential lawsuit.
9. If a quorum of board members meets anywhere and association business is discussed, an open meeting in which owners are required to get notice and are allowed to attend has occurred. “Workshop Meetings” are no exception.
10. The laws governing community associations are constantly changing. Board members that do not stay up to date with these changes risk unintentionally violating the law.
There are certainly many other examples of liability traps. However, by reviewing the above and implementing necessary changes after consultation with an attorney, your association will have a head-start.
