{Ed Note: Eric Glazer has a weekly radio show on Sunday mornings where you can call in with your questions about condo law. Tune in to WFTL AM from 11AM to 12 Noon. Or go to https://condocrazeandhoas.com/blogs/ and type in a key word to find blogs on any subject relating to condominiums or HOAs. That’s where I go when I have a question. The following are excerpts from Eric’s blogs.} 

“Florida law is clear.  Directors serve without compensation unless authorized in the governing documents.  HOA law would also allow payments to an officer or director if voted on in advance by a majority of owners at a properly called meeting where a quorum is present.  The bottom line is that compensation is prohibited unless expressly authorized. it’s far easier for a Board member to get away with wrongdoing if there is no management company and no interest by anyone else on the Board or in the community in checking up on the Board member in control of the check book.  In one of the cases mentioned above, it was my client, a unit owner who was not even on the Board, who uncovered the theft. The other Board members never caught it.

When there’s access to a large amount of money, and little risk of getting caught, because nobody cares about checking the numbers, perhaps the temptation to dip into the till runs high.  There’s older examples of Board members who were described as “devoted” and “kind” and “sweet” stealing association funds and losing them in slot machines at the casino.  Everyone let their guard down, turned their back and had too much trust in one person.  It’s all about having proper checks and balances.”

And this: “Forgery of a ballot envelope or voting certificate used in a condominium association election is a felony, the theft or embezzlement of funds of a condominium association is punishable as provided in s. 812.014, and the destruction of or the refusal to allow inspection or copying of an official record of a condominium association that is accessible to unit owners within the time periods required by general law in furtherance of any crime is punishable as tampering with physical evidence as provided in s. 918.13 or as obstruction of justice as provided in chapter 843. 

An officer or director charged by information or indictment with a crime referenced in this paragraph must be removed from office, and the vacancy shall be filled as provided in s. 718.112(2)(d)2. until the end of the officer’s or director’s period of suspension or the end of his or her term of office, whichever occurs first. If a criminal charge is pending against the officer or director, he or she may not be appointed or elected to a position as an officer or a director of any association and may not have access to the official records of any association, except pursuant to a court order. However, if the charges are resolved without a finding of guilt, the officer or director must be reinstated for the remainder of his or her term of office, if any.”

APATHY CAN BE MORE DANGEROUS TO A COMMUNITY THAN YOU THINK

“We always talk about apathy in community associations.  Nobody wants to run for the Board.  Nobody wants to serve on a committee.  Nobody wants to even vote in the annual election. Usually, apathy is more prevalent in communities where the populace believes all is OK.  If the place generally looks good, the assessments are stable and the cable never goes out, owners believe there is simply no need to get involved with the headache of running the community by serving on the board.  In fact, they are happy that there are others who are willing to step up and take the responsibility.

Here’s the problem with that way of thinking.  Most community associations who have been stolen from were thought by their owners to be operating smoothly and efficiently for years on end.  Then, suddenly, massive theft is uncovered by someone, and it happened because of apathy.  It happened because nobody was watching.  Nobody cared to look at a bank statement.  Nobody bothered to ask to see a copy of the audit.  Nobody bothered to ask how the assessments are being spent.

I recently became involved in a high-profile case here in South Florida.  The bottom line is that decisions of a prior board put the community in harm’s way.  As a result, the entire community was slapped with a massive special assessment to pay a legal settlement.  The new Board allowed every attendee to speak at the special assessment meeting. Many owners were rightfully upset that they had to now pay for the wrongful actions of a few prior Board members.  More than one swore never to pay the assessment.  The interesting part of the meeting came when one of the owners stood up and said that it was too easy to blame the prior Board for the financial mess everyone is now in.  Instead, she thought the blame lied elsewhere.  She thought the blame lied with all the people in the room who were now at a board meeting for the first time in years.  She looked everyone in the face and said that if everyone routinely showed up to meetings like they did that night, the prior Board would never have been able to take the actions they did.  A part of me believes she is right. Apathy can be very costly, even when it appears all is well.

YOU GOT ELECTED/APPOINTED TO THE BOARD. NOW WHAT?

Florida Statute 718.112(2)(d)4b states: Within 90 days after being elected or appointed to the board, each newly elected or appointed director shall certify in writing to the secretary of the association that he or she has read the association’s declaration of
condominium, articles of incorporation, bylaws, and current written policies; that he or she will work to uphold such documents and policies to the best of his or her ability; and that he or she will faithfully discharge his or her fiduciary responsibility to the association’s members. In lieu of this written certification, within 90 days after being elected or appointed to the board, the newly elected or appointed director may submit a certificate of having satisfactorily completed the educational curriculum administered by a division-approved condominium education provider within 1 year before or 90 days after the date of election or appointment. The written certification or educational certificate is valid and does not have to be resubmitted as long as the director serves on the board without interruption. A
director who fails to timely file the written certification or educational certificate is suspended from service on the board until he or she complies with this sub-subparagraph. The board may temporarily fill the vacancy during the period of suspension. The secretary shall cause the association to retain a director’s written certification or educational certificate for inspection by the members for 5 years after a director’s election. Failure to have such written certification or educational certificate on file does not affect the validity of any board action.