Q&A: Board Members Who Are Delinquent with Their Fees

Q. I am living in a small complex with 21 units in Northern New Jersey. We have six people on the board and they all live in the complex and don’t pay the maintenance fees. Is it legal in New Jersey to get compensated to be on the board and to not pay the fees?

 —Sensing a Problem

A. Says Jessica Baker, an attorney with Hill Wallack LLP, which has offices in New Jersey and New York: “All owners are obligated to pay common expense assessments and board members are not exempt. Most of the governing documents provide that board members shall not be compensated for serving on a board, although some older documents may permit the treasurer to receive payment for serving in that position. Also, most governing documents provide that board members can be reimbursed for their expenses.

“The Radburn Legislation, which made changes to the Planned Real Estate Development Full Disclosure Act, N.J.S.A. 45:22A-43 et seq., also provides useful information regarding board members obligations to pay assessments. Pursuant to Radburn, owners in good standing have the right to nominate and run for the board. ‘Good standing’ is defined as an association member who is current on payments of ‘common expenses, late fees, interest on unpaid assessments, legal fees, or other charges lawfully assessed.’ Therefore, to either nominate or run for the board, a member must be current with payment of assessments. 

“Radburn further provides that board members of an association may fill a vacancy on the board created by ‘failure to maintain any reasonable qualification, including maintaining good standing, to be an executive board member…’ Clearly, it is the intention of Radburn that board members must remain in good standing, which includes paying any assessments, while serving on the board. 


Related Articles

IREM Establishes COVID-19 Relief Fund

27 Chapters On Board So Far

The Challenges of Managing a Distressed Property

Getting Back on Track

What to Do About HOA Finances & Arrears During Coronavirus

How Associations Should Respond

Managing a Distressed Property

The Challenge of Getting Back on Track

Tapping Reserves in a Time of Financial Crisis

An Option to (Carefully!) Consider

Some Co-ops Eligible for PPP Loans

Application Window is Open - With Conditions