or power is entrusted for the benefit of another.
Under Texas business organizations law, every CountryPlace Board director is a fiduciary for CountryPlace Master Community Association, Inc. A trustee. A guardian.
Fiduciary duties are the cornerstone of CPMCA corporate governance, giving us core standards of conduct that form the very foundation of how our Board must operate. And of all fiduciary duties, the hallmark is loyalty. Each fiduciary must be loyal to homeowners.
Loyalty to homeowners. Period. Each Board director is a trustee empowered with the protection of the interests and rights of homeowners. Fiduciary faithfulness to homeowners is not merely the greatest loyalty required of a Board director; is it legally and ethically and morally the only loyalty a Board director must have.
Not loyalty to the property managing agent. When a property management agent conspires to strip homeowners of basic rights and privileges, each Board director has a fiduciary duty of loyalty to homeowners not only to fight against such actions, but to demand reimbursement of any expenses charged to the property managing agent for those efforts.
Not loyalty to the President. An HOA president has no executive authority like that of a closed corporation’s president or like that of the U.S. President. No director is obligated to support our President, even after the President makes a decision. Quite the contrary, directors have a fiduciary duty of loyalty to homeowners that demands action against the President if necessary to protect homeowner rights and privileges.
Not loyalty to the Board. Once a Board decision has been made, a director only has the responsibility to follow that decision in the conduct of that director’s specific duties, but even then only if not in conflict with loyalty to homeowners. If a Board decision violated the fiduciary loyalty to homeowners – for instance, if bylaws were amended without protections guaranteed by law or if a major contract was awarded without competitive bidding – then “the Board already decided” is no excuse. Nothing in the requirement of fiduciary duty of loyalty to homeowners requires the Board to stand unified, even after a past decision.
REAL Loyalty preserves CountryPlace values and character.
REAL Loyalty belongs to homeowners and to homeowners alone.