Real Estate & Property Law

What if the Property Manager is on the HOA or Condo Board?

Here is a good question about "cross purposes".

"Dear Beth, Can a homeowner be on the board and work for the property management company. and if not what can we do?"

It's not against the law. In fact, for some HOAs and Condos it works well. The key is having a degree of separation.

It needs to be clear which duties the person is getting paid for as the manager and which duties he or she is doing for the HOA or Condo as a director. That is an unpaid position in most cases, and the governing documents usually say "no compensation" for board members.

It can work well in HOAs and Condo associations that are not able to afford higher cost outside services, and it can raise all kinds of political issues, if not handled properly. If the person does not educate themselves on HOA and Condo management, that, too, can be a real problem for the association. The working relationship needs to be disclosed. The director may not vote on matters related to his or her contract - he or she must abstain. There is more about this in the Vendor Primer on my website (click on the Webstore or Publications link).

It may seem like some kind of a conflict, especially if the person does things that tick people off or that seem "untoward". But it can work, and there is no law prohibiting it, but there is a required disclosure law when a director has some kind of financial benefit or advantage stemming from his or her position on the Board.

Full post as published by California Condo & HOA Law on October 19, 2009 (boomark / email).