The duty of care requires you to make informed, thoughtful decisions. You don't have to be an expert in every area, but you do need to act with the care that a reasonably prudent person would exercise in similar circumstances.

What this means in practice:

• Stay informed: Attend meetings, read the materials, and understand what you're voting on. If you don't understand something, ask questions before voting.
• Do your homework: Before major decisions, gather relevant information. Don't just take the first bid on a project or approve a policy without understanding its implications.
• Seek expert advice: For matters outside your expertise (legal questions, complex financial decisions, major construction projects), consult qualified professionals. The cost of good advice is almost always less than the cost of a bad decision.
• Document your process: Keep records of the information you gathered and the reasoning behind your decisions. This protects you later if a decision is questioned.

A board member in Williamson County told us about a $200,000 pool renovation decision. Instead of just picking the lowest bid, the board hired a pool consultant for $2,000 to evaluate all three proposals. The consultant identified that the cheapest option used materials that would void the warranty and likely fail within five years. That's the duty of care in action: spending a little to avoid a lot.

The duty of loyalty requires you to put the association's interests ahead of your own. You must act in good faith for the benefit of the entire community, not for personal advantage or to favor particular homeowners.

Key aspects of loyalty:

• Avoid conflicts of interest: If you have a personal or financial interest in a matter before the board, disclose it. Depending on the situation, you may need to recuse yourself from discussion and voting.
• No self-dealing: Don't use your position for personal gain. This includes awarding contracts to your own business, getting special treatment on assessments, or using association resources for personal benefit.
• Maintain confidentiality: Sensitive board discussions (legal matters, personnel issues, collection actions) should stay confidential. Sharing this information inappropriately breaches your duty of loyalty.
• Represent the whole community: Even if you were elected by a particular group of homeowners, you now represent everyone. Decisions should benefit the community as a whole.

The conflict of interest test: Before any vote, ask yourself: "Would I make the same decision if no one I knew was affected?" If the answer is no, you may have a conflict that needs to be disclosed.

The duty of obedience requires you to act within the bounds of your authority. This means following your governing documents, applicable state laws, and the association's established policies.

What obedience requires:

• Know your documents: Your Declaration, Bylaws, and Rules & Regulations define what the board can and cannot do. Decisions that exceed your authority are voidable and can expose the board to liability.
• Follow proper procedures: Your Bylaws specify how meetings must be noticed, how votes must be conducted, and how decisions must be documented. Following these procedures protects the validity of your actions.
• Enforce consistently: Apply the rules equally to all homeowners, including board members. Selective enforcement undermines your authority and creates legal exposure.
• Comply with law: Beyond your governing documents, you must follow applicable state and federal laws, from Tennessee's Nonprofit Corporation Act to fair housing requirements.

We've seen boards get into trouble by making well-intentioned decisions that exceeded their authority. One board approved a major assessment without the membership vote required by their Declaration. Even though the project was clearly needed, they had to start over, refund the assessments, and hold a proper vote. Following proper procedure would have taken less time than fixing the mistake.

Here's the good news: courts don't expect perfection. The business judgment rule protects board members who make honest mistakes, as long as they acted in good faith, with reasonable care, and in what they believed was the association's best interest.

What the business judgment rule requires:

• You made an informed decision (duty of care)
• You had no personal interest in the outcome (duty of loyalty)
• You acted within your authority (duty of obedience)
• You genuinely believed the decision was best for the association

If you meet these criteria, courts generally won't second-guess your decisions, even if they turn out badly. A roof replacement that develops problems isn't a breach of fiduciary duty if you properly vetted contractors and made an informed choice.

What removes protection:

• Gross negligence or recklessness
• Undisclosed conflicts of interest
• Actions beyond your authority
• Bad faith or intentional harm

Understanding fiduciary duties is one thing. Living them day-to-day is another. Here's how to make these principles practical:

Before every meeting:

• Review the agenda and supporting materials
• Identify any items where you might have a conflict
• Note questions you need answered before voting

During discussions:

• Speak up if you don't understand something
• Ask what information the board needs to make an informed decision
• Disclose any potential conflicts before discussion begins

When voting:

• Vote based on what's best for the community, not personal preference
• If you disagree, say so and have your position recorded in minutes
• Recuse yourself when you have a conflict of interest

Get D&O insurance: Directors and Officers insurance protects board members from personal liability for good-faith decisions. If your association doesn't have it, getting coverage should be a priority.