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BOARD MEMBERS AND THE BUSINESS JUDGMENT RULE
By
Rafael Aquino
Published May 3, 2023
Association board members have the challenging
task of governing and managing the affairs of their communities.
They are responsible for making critical decisions that impact the
lives of the association members, such as setting budgets, managing
finances, enforcing rules and regulations, and making decisions
regarding community amenities and infrastructure. In carrying out
these responsibilities, board members must exercise their business
judgment, and the business judgment rule is a crucial legal
principle that guides their decision-making process.
The business judgment rule is a legal principle
that protects board members from personal liability for decisions
made in good faith and in the association's best interests. This
rule recognizes that board members may make mistakes in their
decision-making process. Still, they are protected from liability if
they act in good faith, exercise due diligence, gather all necessary
information, consult with experts or professionals when necessary,
and make decisions that are in the association's best interests.
Additionally, board members must act within their
scope of authority, staying within their authority and acting with
proper authorization. They should also document their
decision-making process carefully and ensure that all association
members are informed of the decisions and rationale behind them.
However, the business judgment rule does not
provide blanket immunity for all decisions made by board members.
The business judgment rule may not protect board members from
liability if a decision is made recklessly or with gross negligence.
Therefore, board members should consult with legal counsel when
making critical decisions that may have legal consequences.
In conclusion, the business judgment rule is a
vital legal principle that guides the decision-making process of
association board members. Board members must act in good faith,
exercise due diligence, and document their decision-making process
carefully to benefit from this rule. However, it's essential to
consult with legal counsel when making critical decisions that may
have legal consequences.
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As the Co-Founder and CEO
of Affinity Management Services, Rafael P. Aquino leads his team to
redefine excellence. They serve community associations
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and effectively with
dedication and passion. Rafael’s energy and positive
spirit is the foundation of Affinity Management
Services’ company culture, which instills enthusiasm and
excitement when providing expert advice to its board
members and relieving the day-to-day burdens of running
a community association.
Since 2007, Rafael has
developed a work culture that values responsive and
high-quality services. He has led his team by following
a proactive vs reactive philosophy. The same approach
Rafael instills in the day to day operations of each
association. Today, Affinity Management Services
maintains its success and benefits as a result of the
foundation Rafael has built and continues to foster by
providing educational seminars, continuing education
classes for association managers and board members
alike.
Rafael and his team help condominium and homeowners’
associations save money and improve their communities.
His calm, personable, and service-oriented nature helps
him to establish strong relationships with ease. Rafael
is known as a sincere and honest leader who looks out
for the best interests of his clients and communities,
and he strongly advocates for their needs. His role
requires coordination and communication, as such he
takes logical and intelligent steps to approach
challenges head-on.
As a graduate of Florida International University’s
electrical engineering program and a licensed community
association manager, Rafael’s education and skills equip
him with unique insights to tackle complex problems
through critical thinking. He understands how each
component within a system works together in order to
effectively arrive at solutions, techniques, and
conclusions. Therefore, as he manages the multiple
challenges of running a community association management
company, he understands how each property is its own
unique system and tailors’ specific services to assure
that all their needs are met.
For more information about Rafael P. Aquino and Affinity
Management Services please visit
www.ManagedByAffinity.com or call 1-800-977-6279
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Doral Office: 8200 NW 41st ST
Suite 200
Doral, FL 33166
Broward Office: 150 S Pine Island RD Suite 300
Plantation, FL 33324
O: 800-977-6279 ● F: 305-325-4053
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