HOA Q&A: Can Board members be required to work outside of attending meetings and voting?
Editor’s note: Attorneys at Goede, DeBoest & Cross respond to questions about Florida community association law. With offices in Naples, Fort Myers, Coral Gables and Boca Raton, the firm represents community associations throughout Florida and focuses on condominium and homeowner association law, real estate law, litigation, estate planning and business law.
Q: I’m a member of a condominium board in which the other board members are more interested in keeping the quarterlies as low as possible by end rounding state laws increasing the deductible on the insurance without members knowledge, or increasing a lifespan of a roof so as not to fund it just for their own budget. --J.F. Stuart
A: Regarding the insurance deductible, the Condominium Act Section 718.111(11)(c) provides that:
Policies may include deductibles as determined by the board.
1. The deductibles must be consistent with industry standards and prevailing practice for communities of similar size and age, and having similar construction and facilities in the locale where the condominium property is situated.
2. The deductibles may be based upon available funds, including reserve accounts, or predetermined assessment authority at the time the insurance is obtained.
3. The board shall establish the amount of deductibles based upon the level of available funds and predetermined assessment authority at a meeting of the board in the manner set forth in s. 718.112(2)(e).
The decision to choose the amount of the deductible therefore is a Board decision but it would have to be made at a properly noticed Board meeting which the owners may attend.
In regard to increasing the life span of the roof in order to reduce the annual reserve payment, this could only be done if the Board had an objective professional opinion from an engineer, licensed roofer, licensed architect or reserve specialist supporting the increased estimated life of the roof. The Board cannot simply increase the estimated life without this information or they would be breaching their fiduciary duty, in my opinion.
From Aug. 19: Is lengthy advance notice needed for budget board meeting?
From Aug. 12: Is there a term limit to how long someone can be on the board?
Q: I am a new Board member of a condo association. First, on the day I was elected I was told I must work in the office one day a week from 9 a.m. to 12 p.m. I told them I would not be doing so, but offered alternative ways of contributing. A couple of days ago I was told Board members must serve as “Block Captains” and today at a meeting there was a Board vote on that. I am a volunteer, elected by members. Can the Board require Board members to work (outside of typical duties of attending meetings and voting)? --B.C., New Port Richey
A: Simply put, the answer is No. The Board cannot mandate that directors work in the office or serve in other capacities in order to serve on the Board. With that said, it is typical for directors to serve on committees and perform other functions outside of attending Board meetings, but you cannot be forced to do so.
Q: I own a condominium unit in a complex of 34 units. I rent my condo each year for three or four. One of our directors has informed me that if there are more than 20% of owners renting seasonally or annually that the complex, for insurance purposes, will go from being rated residential to commercial and the master policy will increase at least 5% or 10%. Is this a fact? Thank you in advance for your response. --D.G., Jupiter
A: I am told by colleagues in the insurance and mortgage banking industries that the insurance companies and banks do typically have internal thresholds regarding the number of owner-occupied vs. tenant-occupied units and as the proportion of rental units increases, this can affect insurance rates and mortgage rates. I don’t know what the particular threshold is for each company, but regarding banking, above 20% rentals I am told will affect mortgage lending rates. Some associations address this issue by adopting an amendment to the Declaration which caps the maximum number of rented units at any one time.
Richard D. DeBoest, Esq., is a Partner of the Law Firm Goede, DeBoest & Cross. Visit www.gadclaw.com or to ask questions about your issues for future columns, send your inquiry to: question@gadclaw.com. The information provided herein is for informational purposes only and should not be construed as legal advice. The publication of this article does not create an attorney-client relationship between the reader and Goede, DeBoest & Cross, or any of our attorneys. Readers should not act or refrain from acting based upon the information contained in this article without first contacting an attorney, if you have questions about any of the issues raised herein. The hiring of an attorney is a decision that should not be based solely on advertisements or this column.
This article originally appeared on Treasure Coast Newspapers: HOA Q&A: Can Board require members to work besides attending meetings?
