While it's true that having apathetic leadership is an all-too-common problem in a lot of co-op and condo buildings, having a board that oversteps the boundaries of its power or invades the privacy of residents can be just as bad. Ignorance of proper procedure is usually the reason for this kind of problem, rather than malice or other nefarious intent—which means that a better informed board is less apt to go beyond its authority and cause trouble for the community.
Keeping a board on-task and working within the parameters of its authority goes a long way toward fostering not just a functional community, but a neighborly one. People living in close proximity to each other are bound to occasionally rub each other the wrong way, but tensions shouldn’t be escalated by an imprudent board. An out-of-touch board won’t begin to recognize this fact but an educated board will never forget it.
All residents of co-ops and condos should know about the legal and ethical boundaries under which their boards operate, since understanding those parameters will help board members know when to exercise caution, consult their professionals, and more. Not comprehending the limits of a board's powers can lead not only to acrimony, but even to unnecessary (and expensive) litigation.
Generally speaking, a co-op board is the governing body of a corporate entity which owns the property and is the landlord. A condo board is in charge of management of common areas of the building, like hallways and recreational areas. In either setting, board members are usually untrained volunteers who learn how to manage a community while actually doing the job. In order to get the most while giving the most in this service position, board members should do a little homework. They should familiarize themselves with their community’s bylaws and any other documents that govern the board’s authority. Some attorneys who serve co-ops and condos offer tutorials on these documents to familiarize board members with the bylaws and other rules governing their community, giving an overview of board members’ duties. Absent such a service, it falls to board members to perform their due diligence and know the rules they're governing by.
Board business is detailed in the community’s bylaws, proprietary lease, and/or the condo’s declaration, and for co-ops is also governed partly by Business Corporation Law (BCL). With cooperatives, the bylaws govern how the cooperative corporation conducts business such as voting on directors, voting on officers and meeting conduct. The proprietary lease governs the landlord-tenant relationship between the co-op corporation and its shareholder-residents, transfers, subletting, respective responsibilities for maintenance and repairs to individual apartments as well as common areas. The BCL also spells out provisions for holding annual meetings; voting by proxy; allowing shareholders the right to view copies of balance and loss statements and other financial documents; and removing directors with or without cause.