HOA Bad Decisions and Liability

[OnBoard]

What is the name of your state? California

During escrow, a buyer’s agent directly requested to our HOA follow up information. We had previously provided all related documents to escrow and the sellers. The inquiry was regarding estimates regarding damage to community property by the sellers’ tree and whether the HOA was going to remove the tree and assess a Remedial Assessment for that. Is it legal or ethical for the HOA to communicate with the buyer? Shouldn’t all communication be through escrow and sellers? For Los Angeles.

Affiliated questions:

I'm Secretary of the Board of a Community Association. In conducting Remedial Work on a property in escrow, it was discovered the property's tree was causing damage to the neighboring wall. The companies giving estimates and the hired company determined that the tree will cause damage to community property in the future. I protested in writing the other Board Members decision to provide a statement to the sellers that the tree removal is not necessary, due to threats from the seller. Question is two fold: how do I protect the Association's interest and am I personally liable for the decision of the other Board members? I was told that the D&O would not cover the Board members should anything happen in the future because they knew of the possibility.

 

[Taxing Matters]

What is the name of your state? California
Is it legal or ethical for the HOA to communicate with the buyer? Shouldn’t all communication be through escrow and sellers?

The disclosure by the HOA is not illegal unless there is something in the HOA covenants that says the board may only communicate that information to the HOA owners selling the property.

Question is two fold: how do I protect the Association's interest and am I personally liable for the decision of the other Board members? I was told that the D&O would not cover the Board members should anything happen in the future because they knew of the possibility.

As just one member of the board, all you can do is vote for what you think is best for the association. You can of course urge the board to approve consulting an attorney to make sure that the HOA isn't leaving itself open to some legal liability. You are certainly not personally responsible for what other board members do.

 

[OnBoard]

The disclosure by the HOA is not illegal unless there is something in the HOA covenants that says the board may only communicate that information to the HOA owners selling the property.



As just one member of the board, all you can do is vote for what you think is best for the association. You can of course urge the board to approve consulting an attorney to make sure that the HOA isn't leaving itself open to some legal liability. You are certainly not personally responsible for what other board members do.

Thank you very much for your input.