Rule 7.3: Rulemaking or Amendment, and a Director's Undisclosed Rental

Separate the board's rule power from the members' amendment power. Rulemaking generally implements existing covenants and regulates conduct; it does not create new substantive limits on the rights owners purchased. Apply a practical test to each element of Rule 7.3:

• Does it remove a right owners reasonably relied on, add an affirmative obligation, or conflict with the declaration? The 15 percent rental cap and mandatory tenant registration do all three. They change what a unit may be used for, not how existing uses are conducted.
• Six-month minimum term is closer to a reasonable implementation of 'residential use only' if prior practice and any prior rules support it, but it is still contestable because it eliminates the nightly use some owners have exercised.

So the rule is a mix: part regulation, part de facto amendment. Adopting the amendatory parts by board vote alone exposes the association to a challenge it will likely lose, and applying a retroactive cap to existing rentals compounds that. Recommendation: enforce the least intrusive measure now, segregate the rental cap and submit it to the membership through the declaration's amendment procedure (notice, two-thirds of all owners, recording), and grandfather existing leases to the extent the declaration and state law require. Before finalizing, verify whether the jurisdiction limits rental restrictions at all - some do. Also flag enforcement fairness: the president must receive the identical notice, or every future enforcement action becomes a selective-enforcement defense.

This is a duty-of-loyalty problem, and the process failure matters even if no personal gain was intended.

1. Disclosure - the president completes a written conflict disclosure naming both rental units and the financial effect of the rule, and it goes into the record before any further discussion.
2. Recusal - the president leaves the discussion and does not vote on enforcement, variances, or the amendment submission. Minutes should record the disclosure, the recusal, and who remained.
3. Determine whether her vote was outcome-determinative. If the rule passed only with her vote, the board should rescind and revote without her. If it passed without her, note that in the minutes - it does not cure the taint, but it affects remedy.
4. Enforcement. The president must be cited and processed like any other owner, with the same notice, cure period, and hearing rights. Non-enforcement against a director is the single most damaging fact in later litigation, and it converts a governance dispute into a credibility dispute.
5. Escalation. If the board will not act, the manager documents the recommendation and the board's direction and refers the matter to association counsel; the manager advises and executes, but does not adjudicate the director's conduct.

Treat the two requests separately.

Records. Conflict-of-interest disclosure forms are generally treated as association records available to members: they concern the conduct of board business, not personnel matters. Produce the form within the statutory response window, in the requested format if reasonably available, and redact only genuinely exempt data (Social Security numbers, unlisted personal phone numbers, anything covered by a specific statutory exemption). If any portion is withheld, say so in writing and cite the exemption - silence is what turns a records request into a claim.

Hearing. Due process is procedural, not substantive: written notice stating the rule and the facts alleged, reasonable time to prepare, an opportunity to present documents and witnesses and to be accompanied by counsel, an impartial decision-maker (the president should not preside or participate), and a written decision with an appeal route to the full board.

Sequence matters. Fix the process defects - the president's participation and the unresolved authority question - before the hearing. Otherwise the association ends up litigating how it decided rather than what the owner did.