Duties of Homeowners Association Directors

What are the duties of an HOA board of directors—and when can a director be held liable for their decisions?

Directors of homeowners associations are not expected to be perfect, but they are required to follow certain legal duties when making decisions that affect the community.

At a basic level, HOA directors are expected to act in good faith, in a manner they believe is in the best interests of the association, and with the care an ordinarily prudent person would use in similar circumstances. Courts will often defer to board decisions when those decisions are made properly, and directors are not typically liable for mere mistakes in judgment.

That protection is not unlimited.

Directors can face exposure when issues involve mismanagement of association funds, failure to enforce governing documents, failure to maintain common areas, conflicts of interest, or decisions made without reasonable inquiry. Questions also arise when directors delegate too much authority or allow personal interests to influence board actions.

Directors also owe a duty of loyalty to the association, which requires avoiding self-dealing and properly handling conflicts of interest when they arise.

These principles sound straightforward, but how they apply in real-world situations is often more nuanced—and that’s where most disputes begin.

The full article breaks down the duty of ordinary care, the business judgment rule, judicial deference, fiduciary obligations, and when directors may lose the legal protections that would otherwise apply.