Your Neighborhood Law Firm

How can HOAs avoid accusations of bad faith?

In Texas, Homeowner’s Associations are becoming more-and-more popular as planned communities continue to sprawl around major metropolitan communities, like Houston. HOAs serve as custodians of community standards and property values, and they can ensure that good-acting neighbors have some recourse against bad-acting neighbors. However, HOAs necessitate a commitment to transparent operations and member-centric practices to prevent accusations of bad faith that could lead to litigation.

Prioritizing member interests

First, HOAs must uphold transparency and prioritize member interests to maintain trust. Clear communication, timely responses to inquiries and equitable enforcement of rules are paramount. Otherwise, distrust begins to flourish, and accusations start.

Fulfilling duty to members

Next, realize that central to HOA governance is your duty to your HOA members. This duty demands a standard of care and loyalty from board members. Regular training on fiduciary responsibilities ensures compliance with governing documents and state laws. In Texas, it seems like HOA laws change every year the legislature is in session.

Mitigating potential damages

HOAs must proactively mitigate risks by maintaining adequate insurance coverage and implementing risk management strategies. This includes property inspections and emergency funds to prevent significant financial losses.

Strategic insurance measures

Annual review of insurance policies ensures coverage aligns with evolving community needs. Encourage HOA board members to carry their own insurance.

Nurturing community harmony

HOAs can get a bad reputation, but when well run, they can prove to be an asset to everyone in the community. Through adherence to principles of good faith, commitment to member welfare and effective risk mitigation strategies, Texas HOAs foster community harmony and protect collective interests. Regular policy reviews and risk management practices ensure the association’s and its members’ long-term well-being.