Few people like fine print or red tape, but there are several important documents board members need to be familiar and comfortable with. Collectively, they’re called governing documents. Depending on the type of association you live in, individual documents will differ. Each is a very useful tool that will provide specific guidance.
WHY ARE GOVERNING DOCUMENTS IMPORTANT?
- They give boards the authority to govern by providing for the operation and regulation of the association.
- They provide guidance and protect boards.
- They protect association members by spelling out their rights and responsibilities.
- They are supported by local ordinances, state statutes, and federal regulations.
Governing documents will provide the structure within which the board can work effectively, they’ll guide board decision making, and support association operations. Their greatest value, however, may lie in the protections they provide to board members.
Community association governing documents typically include several items in descending order of authority.
The Declaration (or Master Deed) contains the CC&Rs that regulate resident behavior. They bind all the owners to the association, establish association responsibilities, and define owners’ rights and obligations. (In cooperatives, this document is called the proprietary lease or occupancy agreement.)
ARTICLES OF INCORPORATION
Articles of Incorporation initially create the corporation under state law and define the association’s basic purposes and powers.
They may specify such things as the number of directors, terms of office, and other specifics about how the board functions. (In some states, condominium and planned community associations are not legally required to incorporate, and these may have
articles of association.)
Bylaws contain provisions concerning actual association operations, such as meetings, procedures for electing the board members and officers, and general duties of the board. Sometimes the bylaws cover the same topics as the declaration.
RULES AND RESOLUTIONS
Boards adopt rules and regulations. They must be consistent with the declaration or proprietary lease, the bylaws, and state law.
Rules are usually recorded at a board meeting in the form of a motion called a policy resolution. Making and enforcing rules are important responsibilities for boards that must be undertaken with care. In addition to policy resolutions, boards will also adopt administrative, special, and general resolutions. These resolutions specify how the association should operate. Board members should familiarize themselves with all association resolutions along with the other governing documents.