Every director and officer of a Florida condominium, cooperative, or homeowners association stands in a fiduciary relationship to the owners. Sections 718.111(1) and 720.303(1) say so directly, and Chapter 617 supplies the standard. Section 617.0830, as rewritten effective July 1, 2026, requires a director to act in good faith and in a manner the director reasonably believes is in the best interests of the corporation, and to discharge the duties of the office with the care an ordinary prudent person in a like position would reasonably believe appropriate under similar circumstances. A director who meets that standard is protected by the business judgment rule and by the limits section 617.0834 places on a director's personal liability, even when a decision turns out badly. A director who does not may be personally liable, and since 2024 may in some cases be prosecuted.
The standard of conduct
Chapter 617 was comprehensively rewritten by chapter 2026-168, Laws of Florida, effective July 1, 2026, and section 617.0830 now states the duty in two subsections rather than one sentence. Subsection (1) requires each director, when discharging duties as a director, including as a member of a board committee, to act in good faith and in a manner the director reasonably believes is in the best interests of the corporation. Subsection (2) requires directors, "when becoming informed in connection with a decisionmaking function or devoting attention to an oversight function," to discharge their duties with the care an ordinary prudent person in a like position would reasonably believe appropriate under similar circumstances. Two things are worth noting. The wording of the care standard moved from what an ordinarily prudent person would exercise to what such a person would reasonably believe appropriate, which aligns Chapter 617 with the Business Corporation Act; in our view that changes nothing a board actually has to do. And subsection (2) now names an oversight function alongside a decisionmaking one, which puts in the statute what boards are told anyway: the duty does not end when the vote is taken. The practical content of the duty is unchanged, and it still has three parts:
- Good faith: honest motives, no hidden agenda, no use of the office to punish an enemy or reward a friend.
- Due care: the diligence a reasonably prudent person would bring to the same decision, which means reading the materials, asking questions, obtaining the information a prudent board would obtain, and attending meetings.
- Loyalty to the association: putting the association's interests ahead of the director's own, the director's building or street, or the faction that elected the director.
Subsections (3) through (5) of section 617.0830 allow a director to rely on information, opinions, reports, and statements prepared by officers or employees the director reasonably believes reliable and competent, by legal counsel, public accountants and other persons retained by the association as to matters within their professional or expert competence, and by a board committee on which the director does not serve, so long as the director does not have knowledge that makes the reliance unwarranted. The reliance protection survived the rewrite intact. What moved is where it sits in the section, so a memo or policy that pinpoints an older subsection number for it should be corrected. The rewrite also added subsection (6), which says that a director is not a trustee with respect to the association or with respect to any property the association holds or administers in trust. That answers a question owners raise every time reserves come up. A director of an association that holds reserve funds is held to the director's standard in this section, not to the law of trusts. A director who follows the engineer's recommendation and the attorney's advice has satisfied the duty of care even if the engineer and the attorney were wrong. A director who ignores them, or never asks, has not.
The business judgment rule
Florida courts do not sit as super-boards. Under the business judgment rule, as applied to associations in Hollywood Towers Condominium Association v. Hampton and the cases that follow it, a court asks two questions about a challenged board decision: was it within the scope of the board's authority under the statute and the governing documents, and was it reasonable, meaning not arbitrary, capricious, or in bad faith. If the answer to both is yes, the court will not substitute its judgment for the board's, and the owner challenging the decision loses even if a different decision would have been better. The rule protects decisions about which roofer to hire, whether to pursue a claim, how to schedule repairs, and how to enforce a rule, so long as the board actually decided, on an informed basis, within its authority.
The rule does not protect decisions the board had no authority to make (a material alteration without the required owner vote), decisions made without deliberation (rubber-stamping the manager's recommendation without reading it), or decisions tainted by self-interest (awarding a contract to a director's company without the statutory disclosures). It is a protection for process, and the minutes are the evidence of process. Our meeting minutes guide explains how to document a decision so that the rule applies.
What the duty requires day to day
Fiduciary duty is abstract; the obligations it produces are concrete.
- Know and follow the documents and the statute. A director cannot act in the association's best interests without knowing what the declaration requires and what Chapter 718 or 720 permits. The statutes now require every new director to complete an approved education course within 90 days and continuing education thereafter.
- Maintain the property. The association's duty to maintain, repair, and replace the common elements or common areas is the board's to carry out, and deferring maintenance to keep assessments low is the breach owners sue over most. Structural safety obligations for condominiums (milestone inspections, reserve studies, funded reserves) are now statutory and not subject to board discretion.
- Manage the money honestly and prudently. Adopt realistic budgets, fund required reserves, review bank statements and financial reports, maintain fidelity coverage for those who handle funds, follow competitive bidding rules, and never allow a single person to control receipts and disbursements without oversight.
- Avoid conflicts and disclose the unavoidable ones. Follow the statutory conflict-of-interest procedure for any contract in which a director, officer, or relative has an interest; never accept anything of value from a vendor. Our conflicts of interest guide covers the procedure.
- Treat owners uniformly. Enforce the documents consistently, respond to records requests within the statutory period, and apply the same collection policy to every account, including a director's own.
- Keep confidences. Privileged advice, protected records, and personnel information learned as a director stay with the board. A director who forwards the attorney's litigation memo to a neighbor has breached the duty and may have waived the privilege.
- Make decisions as a board. Individual directors have no authority; the board acts by vote at a noticed meeting. A director who commits the association to a contractor, or tells an owner a violation will be excused, has exceeded his or her authority and exposed the association.
Personal liability and its limits
The liability standard in sections 718.111(1)(d) and 720.303(1) tracks section 617.0834, which was itself rewritten effective July 1, 2026. A director or officer is not personally liable for monetary damages for any statement, vote, decision to act or not to act, or failure to act, unless both the director or officer breached or failed to perform the duties of the office and that breach constitutes one of four things: a violation of criminal law (unless the director or officer had reasonable cause to believe the conduct was lawful); a transaction from which the director or officer derived an improper personal benefit, directly or indirectly; conscious disregard for the best interest of the corporation, or willful or intentional misconduct; or recklessness or an act or omission committed in bad faith, with malicious purpose, or in a manner exhibiting wanton and willful disregard of human rights, safety or property. The last two are keyed to the kind of proceeding brought, and which one a claim falls under depends on who is suing. Ordinary negligence, poor judgment, and unpopular decisions do not meet that standard. The association, not the director, answers for them.
Two features of the rewritten section are new and worth a board's attention. Recklessness is now defined by statute. Section 617.0834(4) defines it as acting, or failing to act, in conscious disregard of a risk that is known, or so obvious it should have been known, and that is known, or so obvious it should have been known, to be so great as to make it highly probable that harm would follow. That is a demanding test, and a good deal narrower than the sense in which owners use the word in demand letters. It gives a defending director something concrete to measure a complaint against. The section now defines who it protects. Subsection (4) defines a "director" as a person who serves as a director, trustee or member of a governing board, without reference to compensation, but defines an "officer" as a person who serves without compensation except reimbursement of actual expenses. A compensated officer of an association therefore should not assume this section covers him or her.
Three further protections apply. The governing documents and Chapter 617 provide for indemnification of directors for expenses incurred in defending claims arising from their service. Section 617.0831, as rewritten effective July 1, 2026, states the source of those rules plainly: sections 607.0850 through 607.0859 of the Business Corporation Act apply to a corporation organized under Chapter 617, with "directors" in those sections reading as the directors, managers or trustees of the association and "shareholders" reading as its members. A board asking what it may or must pay for, and when it may advance expenses before the case ends, looks to those sections and to its own bylaws, not to a separate not-for-profit indemnification code. One exclusion matters during turnover: section 617.0831 provides that "director," as used in section 607.0831 and sections 607.0850 through 607.0859, does not include a director appointed by the developer to the board of a condominium association under Chapter 718, a cooperative association under Chapter 719, a homeowners' association defined in section 720.301, or a timeshare managing entity under Chapter 721. Directors' and officers' liability insurance pays defense costs and, within limits, judgments for covered claims, which is why the policy must be maintained and claims tendered promptly. And the business judgment rule disposes of most claims before liability is ever reached.
The limits are real. Since 2024, a condominium officer, director, or manager who solicits or accepts a kickback commits a felony; a director who knowingly, willfully, and repeatedly violates records-access requirements, or who destroys records or refuses access to conceal a crime, faces criminal penalties; and fraudulent voting activities in association elections are crimes. Directors charged with certain offenses involving association funds are removed from office. Insurance does not cover any of it.
Common breaches
The claims we see most often against directors arise from a short list of conduct: awarding contracts to friends or relatives without disclosure; using association funds or employees for personal purposes; refusing records requests to hide financial problems; enforcing rules against adversaries and ignoring them for allies; deferring structural repairs the engineer recommended; making unilateral commitments outside a meeting; disclosing privileged or protected information; and retaliating against owners who complain. None of these is a close call under the standard, and each is avoidable.
How boards protect themselves
- Educate. Complete the required courses and read the governing documents; ignorance of the declaration is not a defense to a claim the board violated it.
- Rely on professionals and say so. Engage counsel, the accountant, the engineer, and the manager on the matters within their expertise, follow their advice, and minute that the board did.
- Deliberate at noticed meetings and record the votes. The minutes are the board's evidence that the business judgment rule applies.
- Adopt policies. Written collection, enforcement, records, conflict-of-interest, and investment policies applied uniformly remove the appearance of favoritism.
- Insure. Maintain D&O coverage with adequate limits, confirm it covers volunteer committee members and the manager, and tender every claim, complaint, and demand letter the day it arrives.
- Disclose conflicts and step aside. A director with an interest in a decision discloses it, does not vote, and lets the record show both. Since the 2026 rewrite of section 617.0832, that record is what decides who bears the burden of proving the contract was fair if an owner challenges it.
Frequently Asked Questions About Director Fiduciary Duty
Can a board member be sued personally?
Anyone can be named in a lawsuit, and directors sometimes are. Under section 617.0834, however, a director is not personally liable for monetary damages unless he or she breached a duty and the breach involved criminal conduct, an improper personal benefit, conscious disregard or willful misconduct, or recklessness or bad faith. The section as rewritten in 2026 protects a director whether or not the director is compensated, but it protects an officer only if the officer serves without compensation. Most claims against individual directors are dismissed on that basis, and D&O insurance funds the defense.
Does the board have to do what the owners want?
No. Directors owe their duty to the association as a whole, not to the owners who elected them or the owners who attend meetings. A board may, and sometimes must, make unpopular decisions such as levying a special assessment for required repairs. The owners' remedies are the election and the recall, not a claim that the board ignored their preferences.
Is the board liable if a decision turns out badly?
Not if the decision was within the board's authority and was made in good faith on an informed basis. The business judgment rule protects reasonable decisions, not correct ones. The board that hired the lower bidder after reviewing both proposals and the engineer's recommendation is protected even if the contractor fails.
What is the difference between negligence and breach of fiduciary duty?
Negligence is a failure to exercise reasonable care; breach of fiduciary duty is a failure to act in good faith, with due care, and in the association's interests, by a person in a position of trust. Under the statutes, a director's personal liability for either requires both a breach of duty and the aggravated conduct section 617.0834 describes, which since July 1, 2026 includes a statutory definition of recklessness. The association itself may be liable for ordinary negligence, for example in maintaining the property.
Can a director rely on the manager?
Yes, on matters within the manager's competence, so long as the director has no knowledge suggesting the reliance is unwarranted. Reliance does not mean abdication: the board must still review the manager's reports, ask questions, and make the decisions the statute reserves to the board.
Do fiduciary duties apply to committee members and officers who are not directors?
Officers owe the same duties as directors under the statutes. Committee members who exercise delegated board authority are generally held to a similar standard, and the D&O policy should cover them. Purely advisory volunteers have less exposure but should still follow conflict and confidentiality rules.
Contact Hamilton Mikes
Hamilton Mikes trains boards on their duties and defends directors and associations when duty is questioned, throughout Southwest Florida. Call 239-594-7227 or visit our Corporate Governance and Risk Management pages.
Statutes and authorities referenced
- § 718.111(1)(a) and (d), Fla. Stat. (fiduciary relationship to unit owners; standard of conduct; kickback prohibition; liability standard)
- § 720.303(1), Fla. Stat. (HOA directors' fiduciary relationship to members; liability standard)
- § 719.104(9)(a), Fla. Stat. (cooperative directors' fiduciary relationship)
- § 617.0830, Fla. Stat. (general standards for directors; reliance on officers, professionals and committees)
- § 617.0834, Fla. Stat. (immunity of volunteer officers and directors from monetary liability except for criminal conduct, improper personal benefit, recklessness or bad faith)
- § 617.0831, Fla. Stat. (indemnification)
- § 718.3027 and § 720.3033(2)–(3), Fla. Stat. (conflicts of interest)
- Hollywood Towers Condominium Ass'n v. Hampton, 40 So. 3d 784 (Fla. 4th DCA 2010) (business judgment rule applied to association decisions within authority and reasonable)