Governance, Board Operations, and Governing Documents
The hierarchy of authority
Most governance questions are answered by knowing which document controls. Learn the order of precedence: federal and state law, the recorded declaration (CC&Rs), the articles of incorporation, the bylaws, then rules and resolutions. A lower document may not contradict a higher one. Trap: questions often test whether a board can adopt a rule that conflicts with the declaration. It cannot, however reasonable the rule seems; the declaration must be amended by the membership at the threshold stated in the document or statute.
Board operations
Boards act only as a body. Individual directors, including the president, have no authority unless the board delegates it. Know notice requirements, quorum, voting, minute-taking, the narrow purposes of executive session, and the annual meeting and election cycle. Minutes record decisions and their rationale, not verbatim debate.
Members' rights
Owners may attend meetings, inspect specified records, vote, and petition the board. They do not direct day-to-day management, and they cannot overrule a board decision except through the remedies the documents and law provide.
Rule of thumb: when documents conflict, follow the more senior document, and check the statute first, because law overrides the declaration and the declaration overrides the bylaws.
Worked example: A declaration permits leasing with no cap. The board adopts a rule limiting rentals to 10 percent of units. The rule is unenforceable as written because it conflicts with the declaration. The board may enforce the leasing provisions already in the declaration and pursue a membership amendment for a cap. "The board may adopt any reasonable rule" is the classic distractor.