California Code of Ethics, Duty of Care of Board of Directors of Homeowners' Association

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Multi-State
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US-1127BG
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Description

Homeowners require their properties to be properly maintained; they expect a healthful living environment; and they anticipate the Board of Directors will function efficiently and effectively and provide a financially sound organization. Accordingly, the services provided by the Board of Directors require honesty, impartiality, fairness and equity, and must be dedicated to the protection of the public health, safety, and welfare. Board of Directors must perform under a standard of professional behavior that requires adherence to the highest principles of ethical conduct. Board Members, therefore, must be eager to maintain and improve the standards of their calling and share with their fellow homeowners a common responsibility for its integrity and honor. As such, Boards of Directors pledge to observe its spirit in all of their decisions and to conduct the business of the association in accordance with the creed set forth.
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FAQ

Duty of loyalty requires HOA board members to act in good faith to promote the best interests of the entire association. HOA board fiduciary responsibility prevents board members from making decisions to further their personal interests. Board members must also avoid an HOA board of directors conflict of interest.

There is no law in California that prevents an association's board of directors, the association or even its employees and vendors from being sued in any court. Whether or not such lawsuits are justified is decided by the court.

Creating a Code of Ethics for HOA Board MembersCommit Yourself to the HOA.Follow Your Governing Documents and Applicable Laws.Disclose and Avoid Conflicts of Interest.Practice Confidentiality.Never Discriminate.Exhibit Professional Behavior.Always Work Within the HOA's Structure.More items...?

Generally, board members are shielded from personal liability through provisions of the CC&Rs, D&O insurance, and California law, including but not limited to, Corporations Code section 7231, more commonly known as the business judgment rule (BJR).

Establish a strict agenda and let everyone know that it will be followed carefully so as to eliminate any one person taking over the conversation. Give board members a chance to change their ways by having a kind conversation about the problem behavior. Above all, set a good example of what makes a good HOA member.

Preserve All Board E-mail Just as e-mail sent at your job isn't private, nor is e-mail private when you're communicating with other board members or owners in your capacity as a board member.

What Makes a Great HOA Board Member?Enjoy volunteering.Are civic-minded.Are positive and optimistic.Exercise fairness.Know that the rules apply to them, too.Take their role seriously.Have a mind for business.Understand that their authority comes as a board, not a board member.More items...?

HOA board fiduciary responsibility prevents board members from making decisions to further their personal interests. Board members must also avoid an HOA board of directors conflict of interest. This includes choosing a family-related vendor or voting on issues with a bias.

The maximum amount you can sue an HOA for in small claims court is $10,000. If an HOA owes you $10,000 or less, then you can sue in a California small claims court. If you are owed more than $10,000, you can still sue in small claims, but you agree to waive any additional amount you are owed.

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California Code of Ethics, Duty of Care of Board of Directors of Homeowners' Association