Question:
Our HOA board president is obsessed with Pickleball and our converted tennis courts that accommodate Pickleball. He is taking money out of the reserves to improve and expand our Pickleball facilities without a vote. This is an unbudgeted item and he’s using money from the reserves. The amount of money is $35,000. Is this a breach of his fiduciary responsibilities per the HOA guidelines in the Commonwealth of Pennsylvania? Can he be held personally liable for a breach of fiduciary responsibilities to the homeowners? Thank you in advance for your insight.
– Dennis
Answer:
Hi Dennis,
Kindly review the governing documents to verify what the reserve funds must be used for and whether there are any prohibitions. These documents may also indicate whether or not the HOA needs a membership vote to change or upgrade its amenities. Typically, reserve funds may be used for major repairs, replacements, and in some cases, community projects. If the governing documents prohibit using the reserves for upgrading current facilities, then you may raise this with the HOA board. For further guidance, kindly consult a lawyer.
Disclaimer: We are not lawyers. The information provided on this website does not constitute legal advice.
