Q I am the vice president of our board. Just recently we found out through a real  estate agent that the president of the board is selling his unit. Does this pose a conflict of interest? In effect, should the president remain the president while he is selling his  unit? He’s postponed several meetings where we are supposed to address a maintenance  increase. My guess is that he is obligated to tell his prospective buyers about the  maintenance increase, but one would wonder why these meetings have been  continuously postponed.  

 —Derelict in Duty  

A “There are not many statutory provisions in Florida governing the required course  of conduct that must be taken by a director in a co-op board, or other  community association boards, in the event of a perceived conflict of interest,” says Roberto C. Blanch, Esq., from Siegfried, Rivera, Lerner, De La Torre & Sobel, P.A. in Coral Gables. “Florida law governing directors of corporations, such as cooperative  associations, does address potential conflicts of interests between directors  and the corporation’s board upon which they sit. However, such law is limited to situations  involving contracts or transactions between the corporation and one or more of  its directors or an organization in which the director is a director or officer  or is financially interested.”  

 “The law in question provides that the contract or transaction will not be deemed  to be void or voidable if: (a) the relationship or interest is disclosed or  known to the board members who approve the contract or transaction by a  sufficient vote without counting the votes of the interested director; (b) the  relationship or interest is disclosed or known to the members entitled to vote  on the contract or transaction and it is approved by a sufficient vote of the  members; or (c) the contract or transaction is fair and reasonable as to the  corporation at the time it is properly authorized. Given that the issue  presented in this inquiry involves the listing of a home or unit for sale by a  director/officer of the co-op, and not a transaction or contract directly with  the co-op, then the above statutory provision finds no application. As such,  there is no requirement for the president in this example to resign as an  officer or director due to the listing of his home or unit for sale. That said,  Florida laws governing co-op board members do provide that such directors owe a  fiduciary duty to the association. This duty obligates the director to place  the interests of the association above his personal interests. Included within  such obligations is the duty to ensure that association assessments are imposed  at levels aimed to achieve sufficient funds to meet the association’s financial needs. Therefore, the president may be in breach of his fiduciary  duty owed to the association, if his postponement of several meetings scheduled  for the purpose of discussing possible increases in assessments was motivated  more so by his interest to make his home or unit more marketable rather than to  serve the best interests of the association. If such is the case, then the  other directors should consider action to remove the president from office or  prevent him from further postponing necessary board meetings.”      n