Condo owners need to respect boundaries and understand when board directors are “on duty” as a director and when they are “off duty” and being an owner.
Let me create a scenario. It’s a Saturday afternoon and you’re out for a walk with your dog. You see a neighbor walking towards you and as he approaches, he begins discussing a recent decision the condo board has made. You are enjoying being outside and do not want to talk shop with an owner and answer his questions. This is a clear example of an owner not respecting boundaries. Nor is it appropriate that a director discusses a decision made by the board.
One of the biggest challenges of being on a condo board is managing condo owners’ expectations of directors. Condo board directors are owners too, so this can be tricky!
One very annoying situation that directors complain about is usually something to the effect of “I hate when owners come up to me in the hallway with a problem.” So how can this be dealt with?
The best way to alleviate this issue is to make sure owners understand when directors are ON and OFF duty. Directors are on duty when attending board meetings and are off duty at all other times. Directors need to make sure owners understand the differences. Boards need to educate owners, remind them regularly and never fall into the trap of getting into long conversations during the Saturday dog walk.
How are Owners & Directors Different?
Firstly, owners. Owners are not likely experts in governance. They attend AGMs, run for the board and bring up condo issues. Owners should not expect to talk shop with directors EXCEPT at AGM or special meetings. They read and understand rules, declarations and bylaws.
Owners who serve as directors become very knowledgeable about governance. Directors lead AGM’s, listen to issues, complaints and are experts when it comes to the rules, declarations and bylaws. They insist on privacy at home and hold a fiduciary responsibility to the condo corporation.
How to avoid mixing business with pleasure
Condo owners need to know when directors are ON and OFF duty. Likewise, directors need to understand what it means to be ON duty.
On Duty: Directors’ are on duty during meetings and must make decisions in the best interest of the condo corporation (known as fiduciary responsibility).
Off Duty: Directors are off duty at other times and are allowed to be themselves.
Understanding fiduciary responsibility
During my time serving on my condo board, I learned first-hand how difficult it can be for directors to fully understand their fiduciary responsibility. Additionally, the owners need to understand the reasons behind the decisions made by the board.
For example, imagine the board is debating a $10,000 special assessment for a window replacement project. A director might think, “I don’t have the money for this right now” and wish to vote against it. This director has gone OFF duty and stopped working as a director – not good practice during a board meeting. If the window replacement is required to ensure the soundness of the building, directors must vote in favor (even if it causes financial hardship for a director).
Owners think how a special assessment will affect themselves and don’t necessarily understand that directors make decisions in the best interest of the corporation.
Communicating the reasons for a special assessment or any fee increase for that matter is necessary and becomes second nature for a board that has internalized the philosophy of openness and transparency; two key aspects of good governance. Managing condo owners’ expectations will help directors considerably.