ABA Family Legal Guide

Home Ownership

Shared Ownership: Condos and Condominiums

The Board of Directors

What can I do if the board isn't doing its job?

Most problems arise if a board neglects the enforcement of rules or misuses the funds entrusted to it. If you suspect financial problems, you are entitled to review the association's financial documents, including its budget, financial report, bank loan documents, and record of reserves. Together with other concerned unit owners, you may hire an independent accountant for an audit even if the board refuses to do so.

If you believe the board has become autocratic and tyrannical, review the minutes of the board meetings to see whether decisions were made in accordance with the association's bylaws, rules, and regulations. Was there proper notice of meetings? Were all procedures proper? If not, some of the board's actions may be void.

When the board has seriously mismanaged its responsibilities, you have two basic options. The first and best option is to run for a position on the board yourself and convince some suitably qualified neighbors to do the same. If the board has clearly exceeded its authority or even undertaken activities with which a majority of the unit owners disagree, the unit owners, by petition, may order a recall of some or all of the board members, by an election in which new board members can be elected. Another option, which should be a distant second only undertaken with great care, is to litigate the issue. Be aware, though, that the board has a right to assess the unit owners to pay for its own defense, so you will be paying for the legal representation of both sides. Under the uniform acts, the loser will also have to pay the winner's fees. And remember that the business judgment rule described above can protect the decision of the board as long as it has been arrived at honestly. Arbitration or mediation may be a less costly approach. In fact, your bylaws might require it.