
Board of Directors: FIDUCIARY DUTIES. (Or, How to Avoid Legal Trouble). A Board’s Role. Governing Body for its Association Comprised of Directors Directors are voted in by Members (a.k.a. Owners) Directors then vote for Officers (i.e. President, Vice President, Secretary, Treasurer)
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(Or, How to Avoid Legal Trouble)
Board makes MOST decisions for its Association, such as for:
Collections
Architectural Control
Maintenance
Common Areas and Parking
Easements and Licenses
Budget and Assessments
Leasing
… and many more set forth in the Documents
Boards MUST act:
in Good Faith
with the Care of an Ordinary Prudent Person, and
in the Best Interest of the Association.
These are the Board’s
FIDUCIARY DUTIES
(MD Real Property Article, § 11-109.1)
(MD Real Property Article, § 11-113)
Remember, a Board must perform its legal duties:
in Good Faith
with the Care of an Ordinary Prudent Person, and
in the Best Interest of the Association.
Electronic Transmission of Notice
(MD Real Property Article, § 11-139.1)
1) the Board gives the Association the authority to provide notice of a meeting or deliver information by electronic transmission;
2) the Owner gives the Association prior written authorization to provide notice of a meeting or deliver information by electronic transmission; and
3) an Officer or Agent of the Association certifies in writing that the Association has provided notice of the meeting or delivered material or information as authorized by the Owner.
Electronic Transmission of Votes or Proxies
(MD Real Property Article, § 11-139.2)
Despite language in the governing documents, the Board may authorize Owners to submit a vote or proxy by electronic transmission if the electronic transmission contains information that verifies that the vote or proxy is authorized by the Owner or the Owner’s proxy
If the governing documents require voting by secret ballot and the anonymity of voting by electronic transmission cannot be guaranteed, voting by electronic transmission shall be permitted if Owners have the option of casting anonymous printed ballots
Are my e-mails confidential?
What About Inadvertent Disclosure?
Did my inadvertent disclosure waive the Attorney-Client Privilege?
Legal Protections of the Attorney-Client Privilege
Electronic Communications can lead to error and increase the spread of confidential info
Follow the law regarding electronic notice and voting. Do not implement unless a system is developed for tracking and verification
E-mail communications between Board members on business matters should stay within the Board ONLY
Keep a written record of all Board decisions; do not rely on e-mail alone
When in doubt – call your Attorney, or write an old-fashioned letter
And, keep personal business out of Board e-mails!
experience, references, certification and costs
Linda S. Mericle, P.A.
6404 Ivy Lane, Suite 408
Greenbelt, MD 20770
(301) 474-2044
linda.mericle@verizon.net