Boards and the Law How Statute and Governing Documents Intersect

Having an apathetic, uncommunicative board is a big issue in many buildings and associations, but the opposite situation—a board that oversteps its authority—can be just as problematic. When a board does something it should not do, or fails to do something it should (like holding a meeting), it can cost a community in money spent on lawsuits, bad press, and discord among neighbors.

That’s why understanding the parameters of a board’s powers can help a co-op or condo community’s residents keep a close eye on their chosen administrators. All residents can benefit from recognizing precisely what it is that an effective board should be doing. And after acquiring a little knowledge, informed residents will be able to spot potential missteps by board members, and maybe even correct them before they happen.

Being a smart constituent is all about being observant and knowing why or how to object if there is a problem with a board’s actions. But first, a resident must understand a board member’s role.

Leading in Good Faith

Knowing what your building’s board of directors should be doing might sound complicated, but it's really pretty straightforward. Allowable actions for board members are clearly detailed in every building's governing documents, and any curious resident can learn a lot with a little reading. And above all other residents, a board member should be familiar with the boundaries of his or her powers, at the very least by reading those pertinent documents.

A board member not knowing their role is akin to them not doing her job—or at least not doing all of what should be their job. Directors have a responsibility—a 'fiduciary duty'—to act in the best interests of their community, and to not allow personal disputes to get in the way of good management of the building. When volunteering as a board member, a director is expected to put the overall good of the community above his or her own interests.

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4 Comments

  • what do you do when your coop board, the coop attorney and the management company are all the same ethnic group and possibly distantly related?
  • i am a current board member of trustees for a small town. a board member spot has opened and my aunt is one of the people who has asked to fill the vacant spot, is it a situation to where I cannot vote for her
  • Frustrated Sharholder on Friday, October 16, 2015 9:51 AM
    I really enjoyed reading this article. I really would love it if it vaguely reflected the reality that is the coop I live in. I am living in Westchester in a Garden Style coop. I have been here for a relatively long time and I can tell you that almost none of the behaviors listed is engaged by my board. The biggest motivating factor for being on the board here is all the accolades that they can get out of it. You know, they want the best Garage, the Best parking, the Board President wants to sexually harass women in the coop. They get to do just about anything they want. If you don't suck up you don't get anything. I have been very disappointed ever since I got here. Maybe I just picked the wrong place to buy. That could be. I am getting out of the coop living scene and going back to privatized living.
  • What do you do when the president of the board, property manager and super are all one family? Tried waking up the shareholders with memos, flyers about the conflict of interest to no avail. Our beautiful Garden of Eden has become ridden with drugs and more renters than actual shareholders residing here. Treasurer /investor has allowed this egomaniac to destroy this place also. A real estate owner who doesn't live here but serves on the board has been selling and renting out apartments. Parking list is a big secret and not seen by shareholders to see if seniority is followed which isn't; is handled by property manager. Management company attached hold harmless to their contract due to the conflict of interest to protect them. But what about us? Who got our backs when it comes to following laws, policy and procedures? It certainly isn't our attorney that's for sure!