BETHAMY WOODS CCC116

BOARD MEMBER DUTIES

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What Being a Director is All About

Before you run for election, here’s what you should know:

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• The board’s "raison d’être" (or mandate) is to repair and maintain the common elements as they were built by the developer, and to manage the assets of the Corporation. Essentially, directors are part of a team responsible to run a business. As such, they must always act professionally.

• The board has huge responsibilities in many areas, for example long-term maintenance and repair, reserve fund budget planning, etc.

• An owner should never consider joining the board to win a popularity contest or to pursue his/her own hidden personal agenda.

• Directors have legal obligations under the Condominium Act, which cannot be ignored and which cannot be overturned by owners. This means directors must be prepared to make tough decisions, even if those decisions will be unpopular to owners.

• Members are privy to confidential information. They must never share or discuss this information with other owners during, or after, their term on the board. What is discussed at the board stays with the board unless or until all members have agreed on an appropriate time to notify owners.

• All directors are asked to sign a Code of Ethics, which includes a confidentiality agreement.

• A director cannot make decisions independently. Board decisions must be decided by quorum (a majority vote). When the elected board comprises fewer than five members and a tie occurs, the President holds the tie-breaking vote.

• Directors are expected to attend monthly meetings regularly. These meetings will last 2 hours, on average. Directors must also attend the Annual General Meeting, which is usually held in October and lasts about 3 hours. Owners should not consider running for election if they cannot make these commitments.

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Roles and Responsibilities Once Elected

Here’s a good overview of the roles and responsibilities of all directors.

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• Directors must always "act honestly and in good faith" when making the decisions they believe to be in the best interest of the Corporation and its financial status. These decisions may sometimes be unpopular with owners, for example increasing condo fees to ensure the viability of the reserve fund.

• Acting honestly and in good faith means following all standard and legal regulations/procedures before making a final decision. For example, major contracts should be decided through a tendering process and when needed, the board should seek proper professional advice before undertaking a major repair.

• Since directors are volunteers (many with full-time jobs), they often lack the necessary expertise to make sound decisions in certain areas. The property management company provides the expertise, guidance and/or advice needed to make those sound decisions.

• New directors should ask lots of questions. Their questions and fresh viewpoint may result in new solutions to old problems.

• Directors should expect to debate and disagree on certain issues but once decisions are made, the board must present a unified front to the owners. Board solidarity is crucial outside the boardroom.

• Directors, especially new ones, should attend (Canadian Condominium Institute (CCI) courses, if at all possible. The costs of such courses will be covered by the Corporation.

• Directors are elected to set policy and procedures. They are not policemen or repairmen. Such roles fall on the shoulders of the management company.

• Directors are expected to read and familiarize themselves with their meeting package before each meeting so that they are prepared with any questions in advance.

• Board members should also read the previous month’s correspondence prior to each meeting and jot down any concerns or questions they may want to discuss.

• If a director cannot attend a particular meeting, he/she should advise the President or management as far in advance as possible.

• Directors should be prepared to read contracts before signing them and to ask management for clarification if needed.

• As an unpaid volunteer, directors should set limits on their personal availability to owners. If owners approach you with problems, direct them to the management company we are paying to manage the day-to-day needs for the property and to solve individual owner problems.

• Complaints from an owner to a director cannot be ignored. Ideally, the director should encourage the owner to contact management, preferably in writing. Alternatively, the director may choose to contact management on that owner’s behalf.

• Beyond agreeing to bring a complaint forward to the board or management for discussion, no other commitment should ever be made to an owner. Since resolution must be based on what is in the best interest of the Corporation, there are no guarantees that the final outcome will satisfy the owner.

Fran Graf, ACCI, FCCI
Reid Property Management