Serving on your community’s HOA or Condo Board can be a thankless job. Board members put in real time and effort, often unpaid and with little recognition, to keep their association running smoothly. But that commitment also comes with real legal responsibility. Every HOA and condo board member holds a formal role as a fiduciary, and understanding what that means in practice is essential to serving effectively and staying protected.
Here are the key things every board member should understand about fiduciary duty and confidentiality.
You Are a Fiduciary — What That Actually Means
As a board member, you hold a formal legal role as a fiduciary. In plain terms, that means you are required to act in the association’s best interests, not your own and not any individual unit owner’s. Boards operate under state nonprofit corporation law and the Uniform Condominium Act or Uniform Planned Community Act, both of which require directors to make decisions only after a reasonable investigation.
That doesn’t mean you need to become an expert in every subject that comes across the board table. It means gathering the right information before you vote. Information can come from your manager or from outside experts when a topic falls outside the manager’s expertise. Legal questions go to a lawyer; financial questions go to an accountant. You can receive that input through your manager rather than consulting experts directly, but you should review their findings before deciding.
There is real protection built into this process: if you reasonably rely on expert input and a decision later turns out to be wrong, you generally cannot be held personally liable. The same protection extends to relying on the good-faith input of committees or fellow board members with relevant expertise. The common thread throughout is good faith, which means genuinely doing your best for the association.
Wearing Two Hats
Most board members are also unit owners, and it’s easy to blur the line between the two roles. At a board meeting, you’re clearly acting as a director. But what about a conversation with your spouse at home or a chat with a neighbor at the mailbox? A simple rule of thumb: when in doubt, assume you’re being viewed as a board member. That mindset matters most for confidentiality.
The Business Judgment Rule
Once you have done your homework, the law generally instructs courts to defer to your decision rather than second-guess it. This principle is known as the business judgment rule. In practice, courts don’t always apply it consistently, and you can still challenge board decisions. But the underlying protection is real: a documented, good-faith, reasonably informed decision is far more defensible than one made on the fly.
Confidentiality: What Stays Private, and Why
This is one of the most important and most often misunderstood aspects of board service. Board deliberations are typically private, even at communities with “open meeting” policies, because those same communities almost always allow for executive sessions to discuss sensitive matters. Legal disputes, contract negotiations, and concerns about a specific vendor or contractor are examples of topics that should stay within the board room rather than being shared with the broader community.
That does not mean boards should be secretive overall. The key is distinguishing between decisions that should be disseminated collectively, like a final approved budget, and the internal debate that produced them, which generally should not be shared.
A related, practical warning: private conversations between two board members (in the hallway, at the grocery store) generally aren’t official board business and don’t need to be documented. Written exchanges, however, especially email, are a different story. They may be discoverable in litigation and are not protected unless an attorney is directly involved. Board members should be thoughtful about what they put in writing.
Codes of Conduct: Guidelines, Not Contracts
Many associations now ask board members to sign a code of conduct that sets expectations such as acting professionally, prioritizing the association’s interests, and keeping deliberations private. It’s worth noting: a code of conduct isn’t a legally enforceable contract, and violating it won’t, by itself, remove a member from the board or create monetary damages. Even so, it’s a valuable tool for setting shared expectations and giving the board language to point to when conduct slips, particularly regarding the increasingly common problem of board members publicly criticizing one another over disagreements that should have stayed private.
Handling Business Between Meetings
Every board eventually faces decisions that arise between regularly scheduled meetings like contract renewals, unexpected repairs, and other routine or time-sensitive matters. The best approach for this is to adopt a defined procedure in advance. That might mean authorizing an executive committee or a specific officer to act on identified matters (with the details later reflected in the minutes) and separately establishing an emergency action plan for the unexpected, such as requiring the manager to obtain sign-off from the board president before authorizing emergency expenses, rather than letting the manager decide unilaterally.
The Bottom Line
Board service comes with real legal responsibility, but the framework isn’t complicated. Investigate reasonably, rely on qualified experts, act in good faith for the association’s benefit, and keep sensitive deliberations confidential. Boards that document their processes through codes of conduct, defined between-meeting procedures, and clear meeting minutes put themselves in the strongest position, both practically and legally.
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Frequently Asked Questions
Do all board meetings have to follow Robert’s Rules of Order?
No, not unless your governing documents specifically require it. Most bylaws are silent on the point, allowing the board president to run meetings in a more collegial, discussion-oriented format.
Are boards required to hold open meetings?
Very few bylaws require it, and even communities that do allow open meetings still permit executive sessions for sensitive topics. Always check your community governing documents and state regulations.
Can two board members discuss association business outside of a formal meeting?
Yes. An informal conversation between board members isn’t an official meeting and doesn’t need to be documented. Written exchanges like email are different. They may be discoverable in a legal dispute, so it pays to be careful about what is put in writing.
Is a signed code of conduct legally binding?
No. It serves as a set of expectations and guidelines rather than an enforceable contract, and it cannot be used as grounds to remove a board member or seek damages. It is still a useful tool for reinforcing professional norms.
How should a board handle decisions that come up between regular meetings?
Set up a procedure ahead of time, such as authorizing a specific officer or committee to act on anticipated items, and adopting an emergency action plan for unexpected situations, then formally ratify or record those actions in the minutes at the next meeting.
