Understanding pending projects

What counts as a pending project

Any repair, replacement, or improvement the prior board started before you took your seat counts: a signed roofing contract, a landscaping upgrade the board only discussed once, or a drainage fix that's half finished. Some of these have paperwork. Some exist only in someone's memory of a hallway conversation. Your first job isn't to judge the project, it's to find the paper trail: the contract, the request for proposals (RFP) if one exists, and the minutes recording the vote. See Reviewing prior board minutes for how to read that record.

Why you can't just stop it

You may disagree with the vendor the prior board picked, or wish they'd waited for a lower bid. That disagreement isn't, by itself, a reason to cancel. The California Supreme Court, in the leading case on how courts review board decisions about maintaining and repairing common areas, set out the standard other courts return to:

"where a duly constituted community association board, upon reasonable investigation, in good faith and with regard for the best interests of the community association and its members, exercises discretion within the scope of its authority under relevant statutes, covenants and restrictions to select among means for discharging an obligation to maintain and repair a development's common areas, courts should defer to the board's authority and presumed expertise."

Source: Lamden v. La Jolla Shores Clubdominium Homeowners Assn., Supreme Court of California

In plain terms: if the prior board investigated reasonably, acted in good faith, and stayed within its authority, its choice is protected, even if you would have chosen differently. Other states apply their own version of this business judgment rule, with different contours. Confirm how your state's courts treat board decisions with the association's attorney.

What to pull before you vote

Before you vote to continue, pause, or cancel a pending project, gather four things: the signed contract, if any (see What contracts should a new director review?); the minutes and vote that approved it; the funding source, reserves, operating budget, or a special assessment, and whether the reserve study anticipated this cost (see Understanding the reserve position); and, if one exists, the original RFP and how the board compared bids. If any of these is missing, that's information too: a project with no record of investigation is exactly the kind of decision that loses the protection described above.

Investigate before you reverse

A new board that cancels a project without asking why the prior board chose it is taking on the same risk the prior board would have taken by acting without investigation. The test is the same either way: reasonable investigation, good faith, and staying within the board's authority. This mirrors the general duty of care behind any board decision, acting with the care an ordinarily prudent person would exercise in a similar position, a standard codified in Florida's nonprofit corporation act and echoed, with variation, in most states' nonprofit corporation statutes. Confirm the exact wording of this duty under your own state's nonprofit corporation law. Slow down enough to gather the record in the section above before you vote either to continue or to stop. See What shouldn't a new board rush to change? for more on this instinct.