What I learned from this week’s livestream: Fiduciary Duty

During this week’s livestream, we were joined by attorneys from multiple states, including David Byrne, Esq., of Ansell, Grimm & Aaron, P.C., who represents condos and HOAs in New Jersey, New York and Pennsylvania.

Our program, “Breach of Fiduciary Duty – Not Just for Board Members Who Vote ‘Yes,’ But Also for Those Who Vote ‘No’”, took a deep dive into the complexities of fiduciary duty. All the attorneys on our panel did an excellent job highlighting gray areas where board members and managers often find themselves.

One of David’s key insights—also the title of this blog—was, “Every fiduciary duty breach is unethical, but not every unethical action is a breach of fiduciary duty.” His comment, along with the follow-up discussion, illustrated just how fluid and open to interpretation fiduciary duty can be for boards, managers, attorneys, and the courts.

After the livestream, I asked Dave to elaborate further:

“Legally, community association board members are subject to a code of ethics – whether a general or specific code – only insofar as that “code” helps to set and/or define that board’s fiduciary duty.  In general, that means respect of and adherence to the relevant laws and the terms of the community’s governing documents with respect to each action or inaction, with each action or inaction being free of fraud, self-dealing and bad faith.”