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MarkN8 (Texas)
Posts: 2
Posted:
I recently discovered that the Board of Directors had been violating a Texas Property Code Law for over 2 years. I won't go into the details, only to say that they were completely unaware that they had done anything amiss.

Question: Do Board Members have a legal responsibility to know and understand the state laws governing HOA's, or does the Property Management Company, by way of the Property Manager, have the responsibility of informing the Board of any possible violations they may be about to unknowingly commit, ensuring that the HOA stays legally compliant?

SheliaH (Indiana)
Posts: 6,964
Posted:
The property manager works under the board's direction, so while he or she might suggest caution, it's really up to the board to read their documents to understand what the association is supposed to do and what powers the board has. Remember the property manager isn't an attorney - if the board has questions, it should consult the association attorney.

As you might guess, some attorneys are better than others, and the same is true of property managers. Sadly, both can take advantage of a board's lack of knowledge or laziness,and sometimes hunger for power. Occasionally, you see all three at work.

HOA documents is where you start - sometimes boards get in trouble becausethey don't read them- too much legal mumbo-jumbo and they ARE badly written because they were designed with the developer in mind. Developers don't give a hoot as to what happens to the community after it's turned over to the homeowners - they made their money and now its on to the next thing..

You're correct that property managers and board members alike should be aware of state and local law because state and local law usually trump the documents. However, there may be some instances where local and state law defer to HOA documents, sometimes because those laws are tougher than the statutes or the law only applies to HOAs established on or after the date the law takes effect.

This is why it's best to take a look at the documents every 5 -7 years to see what may need updating so tbe community documents keep up. It's also why education is vital to homeowners because they grow up to be board members. During my 10 years on my board, I was fortunate enough to serve with people who knew what they were talking about and not afraid to admit when they didn't - and then they'd go and find out.

We've also had some very good property managers that would speak up if they were concerned the board might be doing something ill-advised and attorneys who held special training every year for their HOA clients where they'd educate them about changes in the law.

Yoh don't say what your board did, but now that it knows, they need to stop it right now. It's possible your property manager didn't know either, so instead of pointing fingers, you may be better off figuring out how you got to this point and what you'll do to prevent it from happening again.

Rule #1 - put in the work to educate yourselves. I usually recommend looking at the CAI website to get some of its educational materials. There may be local chapters in your area you can join to attend workshops and meet people from other communities and exchange ideas.

Rule #2 don't let the property manager or attorney do your thinking for you. You chose to serve on a HOA board and it's not a garden variety block club, so take it seriously. You're a nonprofit organization responsible for thousands of dollars and common area, and serving isn't for sissies (just like old age!) Do your best, apologize if you're wrong, keep learning and remember this is about caring for your neighbor as much as you care for yourself. Everyone wins when you work together and create a clean, safe, attractive community.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius
DeanJ
Posts: 1,786
Posted:
Property managers are not lawyers. It’s not their job to advise on legal matters or interpret laws. Many do not stay current with changes to state law. Those that do are getting information from HOA attorneys presenting their communities.

This is why every HOA should have an attorney specializing in HOA law on retainer to answer a boards questions and to keep the board informed of changes in law.
TimB4 (Tennessee)
Posts: 21,059
Posted:
The Board should keep themselves aware of changes in the law.
Simple internet searches can give them this info.

Property manager should also keep themselves aware of changes in the law.
Since a property manager is being paid, they can not provide legal advice (including interpretation of a new law) to the Board.
To do so could be seen as practicing law without a license.

Members should keep themselves aware of changes in the law.
They are the checks and balances to the board.

Expecting that your board brought the association into compliance after you informed them of the changes, I would say that the issue is resolved.
Hopefully, your board also learned a lesson to keep informed of changes to laws that affect the Association.
MarkM19 (Texas)
Posts: 1,459
Posted:
Mark N,
You say without going into details they are breaking the law. The details are where the devil lives. It sounds like you think something is going on that is not correct. This site sees 1000s of inquiries and has many very qualified board and ex board members who give you free advice.

As long as you follow the posting rules and do not mention HOA names details will lead to the best responses.
ElleN (Idaho)
Posts: 1,334
Posted:
Quote:
Posted By MarkN8 on 07/01/2025 1:20 PM
Question: Do Board Members have a legal responsibility to know and understand the state laws governing HOA's
No. Lawyers who are hired by HOAs have a legal responsibility to know and understand this law.

Be aware that courts understand that HOA directors are volunteers. Statutes and a great deal of case law have dictated that volunteer directors be treated generously when it comes to knowing the law; business judgment; and the like. Only when a director has committed an actual crime (prosecutable under the state's criminal code) might a court crack down on a director.

Suppose an owner believes that a board has violated the law. Suppose the violation is clear. The owner informs the board of her belief. Suppose the board continues to violate the law. The owner then takes the board and HOA corporation to court, to stop the violation. If no crime per se is involved, all a court will do is order the board to follow the law and possibly order the HOA to pay money for any quantifiable, clear damages that resulted from not following the law. (Damages are a huge subject in law. The cost of repairs for penny-enny damage or hurt feelings are not likely to be reimbursed.)

Quote:
Posted By TimB4 on 07/02/2025 5:50 AM
The Board should keep themselves aware of changes in the law.
Simple internet searches can give them this info.

Property manager should also keep themselves aware of changes in the law.
Since a property manager is being paid, they can not provide legal advice (including interpretation of a new law) to the Board.
To do so could be seen as practicing law without a license.

Members should keep themselves aware of changes in the law.
They are the checks and balances to the board.

Expecting that your board brought the association into compliance after you informed them of the changes, I would say that the issue is resolved.
Hopefully, your board also learned a lesson to keep informed of changes to laws that affect the Association.
I agree with every sentence of the above.
MarkN8 (Texas)
Posts: 2
Posted:
Thank you all for your responses and advise. It helps me tremendously to put the situation in perspective.

This Board is made up of good people who want nothing but the best for the HOA, the community and the Homeowners, and I believe they have always acted in good faith. They consist of volunteers who are not required to have any prior legal, financial or business experience. I think they have always relied on the Property Manager to inform them when the legality of their actions and decisions become an issue because the Property Manager has done so many times in the past.

I have not informed the Board or the Property Manager of what I have discovered and have decided that to do so would benefit no one. Fortunately, the situation rectified itself after 2+ years, and the Board and the Property Manager are now aware of the law in question. Board business goes on as usual.

I have always believed that "with knowledge, comes responsibility", and I still believe that. I think the responsible thing to do is to see it as a learning experience and move on.

Thanks again!

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