Academy/Community Management Companies
Board instructions to management
One director's phone call is not a board instruction.
Board instructions to a manager should come from the board acting as a whole, not from one director, and should be given in writing so everyone knows what was authorized. Under the CMCA Standards, a manager's conduct is protected only when it was done at the board's direction and with its full knowledge, not on one board member's private say-so.
Instructions come from the board, not from one director
A manager reports to the board as a whole, not to whichever director calls last. CAMICB, the body that certifies individual managers, describes a CMCA as hired and reporting directly to the elected board, and it will decline to intervene in a manager's conduct when that conduct happened at the board's direction and with the board's knowledge.
"at the direction of and with the full knowledge of the elected Board"
Source: Standards of Professional Conduct (CMCA), CAMICB
That standard cuts two ways. It protects a manager who followed a documented board instruction, and it leaves a manager exposed if they acted on one director's private request instead. The manager has no vote and is an advisor, not a board member, so treating a single director as if they speak for the board skips the step where the board actually decides anything.
Put it in writing, especially where money or legal exposure is involved
A phone call is easy to misremember later. When the board wants the manager to do something outside routine, day-to-day operations, spell it out in an email, a motion, or a written resolution the minutes can capture, so there is a record of who authorized what and when. This matters most for anything touching money, a vendor contract, or an enforcement decision, the kinds of instructions a homeowner or a court might later ask the board to justify.
Why this protects the board, not just the manager
The business judgment rule shields a board's own good-faith, informed decisions from being second-guessed later, even if the outcome turns out badly.
"when board members exercise discretion (i.e., make business choices for the association) within their authority and do so in good faith, a court must defer to the board members' presumed expertise"
Source: Fiduciary Relationship and the Business Judgment Rule, Florida Condo & HOA Law Blog
But the rule protects the board's decisions, not whatever the manager does on their own initiative, and it only reaches decisions the board actually made as a body. A board that lets one director privately direct the manager, without ever discussing or voting on the matter, has not made a collective, informed decision at all, so there is nothing for the rule to protect. The business judgment rule is a common-law doctrine articulated somewhat differently from state to state; confirm how it applies where your association is located.
Watch for the manager filling a vacuum
Practitioner guidance names managers inserting themselves into recalls, elections, or board decision-making as a warning sign, and traces it back to the board's own behavior.
"Problems arise when boards delegate too much to managers"
Source: California HOA Management Company Red Flags Fact Sheet, MBK Chapman
A board that never gives clear, collective instructions leaves that vacuum for someone else to fill.
Check yourself
Answer before you read the explanation, recalling it is what makes it stick.
The board president calls the manager directly and tells them to fire the landscaping vendor today, without discussing it with the rest of the board. What should the manager do?
Two directors, without a board vote, tell the manager to stop enforcing the parking rule for a friend's guest. What should the manager do?
The treasurer alone has been telling the manager what to do on every capital project, with no board discussion. A capital decision goes badly and an owner sues. What protection does the board have?
Sources
- Standards of Professional Conduct (CMCA), CAMICB
- Fiduciary Relationship and the Business Judgment Rule, Florida Condo & HOA Law Blog
- California HOA Management Company Red Flags Fact Sheet, MBK Chapman
- Responsibilities of a Community Manager, CAI HOAresources
Related elsewhere in the Academy
Community Management Companies
Next, learn exactly where a manager's authority ends and the board's decision-making begins.
Whether your bylaws require board instructions to management to take the form of a formal motion or written resolution, and how the business judgment rule applies to your board, varies by state and by your governing documents.