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California Homeowners Association Documents, Part 2: By-Laws

February 12, 2013 at 12:59 PM / by HOA Expert

As I mentioned in Part 1 of this series, my chosen 'foreign' language of study in High School was Latin. Honestly, I had enough trouble with English at the time, yet Latin did become more interesting when I discovered that many of our English words came from Latin. When we consider California Homeowners Association governing documents and legal issues related to them, Latin terms can actually help give us some needed understanding. More on this later.

Last time we discussed the Articles of Incorporation and CC&Rs of a community. Now we will focus on the By-Laws. Unlike the Articles and CC&Rs, the By-Laws are not recorded at either the county or state level, yet they are still an integral part of a California Homeowners Association. They are a legal document of the association, which cannot be changed or amended without a vote of the membership as outlined within the document.

Within the By-Laws you learn about membership within the association. This includes voting rights and other rights and terms of membership. The By-Laws also give direction as to the place, frequency and time of different association meetings. In general, the By-Laws lay out policies and procedures for how a California Homeowners Association is to be governed.

It is in the By-Laws that you find information about who qualifies to be a director (Board Member), how many directors are called for and the length of each directors term of office. You also find information about the duties and powers of directors and officers.To clarify, although all Board members are directors, not all Board members are officers. The By-Laws explain the different offices that directors may hold. Typically, these offices include the following: President, Vice-President, Secretary, and Chief Financial Officer/Treasurer. The details regarding the duties and powers of each of these officers are contained where?In the By-Laws.

I hope that you at least have a general idea now about what you may find in your By-Laws and how important they are in carrying out the business of the association.

Back to the value of Latin.Since much of what the By-Laws address is the governance of the association by the directors (and officers) who become leaders within their community, I want to bring up one last thought; the Latin word "fiduciary". When one becomes a director, they take on a fiduciary duty in which they are to act on behalf of another (in this case the association and its members) regarding what has been entrusted to them. It is to be a relationship of trust and confidence where the fiduciary is expected to act with loyalty and care in the carrying out of their duties, not putting personal interests before their duty. Wow!

When we consider the challenge of leading a California Homeowners Association, we would hope that those who take that step would also take seriously the duty of being a fiduciary.

Topics: HOA Documents and Contracts