BUSINESS JUDGMENT RULE: GREAT RULE TO HIDE FOR THE BAD GUYS?

By Jan Bergemann

Published February 27, 2015

     

It's really a sad state of affairs when the welfare of our families in our homes is regulated by the BUSINESS JUDGMENT RULE!  

 

It may have once been well-intended, but in my opinion it’s nowadays more a great place to hide for the bad guys than a rule protecting the good guys.

 

Let’s make no mistake: “Acting in Good Faith” is a matter of opinion. I can’t consider it “acting in good faith” if the person using this defense has been told – and even given in writing – that whatever he is doing is violating the statutes and the governing documents of the community.

 

Board members should be the first ones to follow rules and laws, before forcing neighbors to obey by rules these same board members plainly ignore.

Board members are supposed to learn the basic rules by attending board member certification seminars or they can sign affidavits stating that “he or she has read the association’s declaration of covenants, articles of incorporation, bylaws, and current written rules and 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.”

 

Guess what: Quite a few of these board members still ignore the laws and rules – in my opinion knowingly and willfully – and are still protected by the business judgment.

 

How can somebody state that he/she acted in good faith when spending reserve funds for other purposes than intended, spending unbudgeted money for non-emergencies, making material alterations without the vote of the membership, refuse to allow owners to inspect the records, commit election fraud and/or fining owners in a vigilante manner ignoring the laws and rules – after attending such seminar and/or signing the affidavit as required by law?

Should they still be allowed to claim that they “acted in good faith?”

 

“Good” board members – the ones following laws and rules – don’t have to be afraid that they have personal liability for their action as board members.

 

And the “bad” guys are hiding behind the “Business Judgment Rule” – to the detriment of their neighbors.

 

Do you still think the “Business Judgment Rule” is a good rule?


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Jan Bergemann Jan Bergemann is president of Cyber Citizens For Justice, Florida 's largest state-wide property owners' advocacy group. CCFJ works on legislation to help owners living in community  

associations. He moved to Florida in 1995 - hoping to retire. He moved into a HOA, where the developer cheated the homeowners and used the association dues for his own purposes. End of retirement!

 

CCFJ was born in the year 2000, when some owners met in Tallahassee - finding out that power is only in numbers. Bergemann was a member of Governor Jeb Bush's HOA Task force in 2003/2004.

 

The organization has two websites to inform interested Florida homeowners and condo owners:

News Website: http://www.ccfj.net/.

Educational Website: http://www.ccfjfoundation.net/.

   
We think that only owners can really represent owners, since all service providers surely have a different interest! We are trying to create owner-friendly laws, but the best laws are useless without enforcement. And enforcement is totally lacking in Florida !


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