In This Issue

Message from the President

NEW: Social Media Sharing Contest!

Register NOW for CAI's First-Ever FREE Webinar for Members!

Who Wants to Be a Fully Protected Community Board: The Claim Game

Upcoming Events

April 19, 2017

Webinar "Never Be Bullied Again: Prevent Haters, Trolls and Toxic People from Poisoning  Your Life"

Time: 1:00pm - 2:00pm CT


April 24, 2017

Homeowner Education Workshop Session 2

Time: 5:30pm - 8:00pm

Location: Hoover Library


May 3-6, 2017

CAI Annual Conference

Location: Caesars Palace, Las Vegas


May 18, 2017

Chapter Luncheon

"What you need to know about Covenant Enforcement"

Time: 11:30am - 1:00pm

Location: The Club, Birmingham


June 20, 2017

Homeowner Education Workshop Session 3

Time: 5:30am - 7:30pm

Location: Hoover Library


Click here to view more upcoming events in 2017!


Interested in joining CAI?

Click here to read about member benefits and join!

Thank you to our

Platinum Sponsors:
Allied Universal Security Services 

Law Offices of Lee Mason  

Community Association Management 

Gold Sponsors:
Associa McKay Management


Boothby Realty

Gibson Landscaping

Spaces Management

Silver Sponsors:
Alliance Association Bank
The Green Team

Mutual of Omaha Bank

Bronze Sponsors:

CertaPro Painters of Hoover

Jones Walker


Ray Engineering

SOLitude Lake Managment

Union Bank

We're Green Clean

Photos from this month's
Chapter Luncheon

Thank you to Joel Meskin from McGowan Program Administrators for presenting "Who wants to be a Fully Protected Board Member - The Claim Game" at this month's CAI Alabama Chapter Luncheon.

Click here to view more photos of this and other events!

2017 CAI AL Chapter
Board of Directors


Andy Turner, AMS, PCAM
Spaces Management

President Elect
Fields Greer
The Green Team

Mildred Lanier
Hayesbury Townhomes HOA

Jamie Brasher Phillips, CMCA, AMS
J.H. Berry & Gilbert

At-Large Member

Lee Mason, CMCA, AMS, PCAM
Community Association Management

Executive Director
Julia Boehm-McKay

Newsletter | March 2017 Print

Message from the President

Dear Members and Friends of the CAI Alabama Chapter!

It was good to see so many of you at this month's CAI Alabama Chapter luncheon at The Club! We were especially honored to have 10 first-time visitors at the luncheon. Also, I was very excited to see that eight of our business partners took the Business Partners Essentials Course in the morning before the luncheon.

CAI Alabama Chapter Luncheon
CAI Alabama Chapter Luncheon

CAI AL Business Partner Essentials Course
Business Partner Essentials Course:
Instructor Joel Meskin (McGowin Program Administrators), Barry Coleman (Union Bank Homeowners Association Services), Instructor Elbert Boothby (Boothby Realty), Mary Stewart Nelson, Esq. (Fish Nelson & Holden LLC), John C. Barnes, Esq. (Law Firm of Alford & Barnes, LLC), Bradley Cromer (The Green Team, Inc.),  Pat Hillen (Alliance Association Bank), Fields Greer (The Green Team, Inc.), Len Park (The Green Team, Inc.) and Cynthia Hobson (Landscape Workshop).

Mark your calendar for two upcoming chapter events!

April 24 - Board Leadership Development Workshop - Session 2: I hope many current and future board members of HOAs and community associations will take advantage of our second session of the Board Leadership Development Workshop on April 24th at the Hoover Library. Please register by clicking here to reserve your spot!

May 18 - Chapter Luncheon: We will have a panel of experienced community association management professionals, an experienced attorney as well as a long-time HOA board member cover everything around the topic "What you need to know about covenant enforcement". This will be once again a great educational opportunity for everyone involved with community associations. Please go ahead and register by clicking here. Also, we are looking for business partners to sponsor this luncheon. If you are interested in being on of our luncheon sponsors, please contact Julia at

I hope you find this newsletter useful, with the latest news from the CAI Alabama Chapter and other upcoming event information.


Andy Turner

Andy Turner
2017 CAI-AL Chapter President
CEO of Spaces Management

SOLitude Lake Management Advertisement

M-206 in Birmingham Oct 19-20, 2017

Back to top

NEW: Social Media Sharing Contest!

Help us spread the word about upcoming CAI Alabama Chapter events and win a prize!

1. Like us on Facebook

2. Follow us on Twitter

3. Follow us on LinkedIn

4. Start sharing any CAI Alabama Chapter event announcements on one or all of your pages.

5. Win a $100 Visa gift card at our Holiday Chapter Luncheon on Thursday, November 30th if you are the member who shared most of the CAI Alabama Chapter event announcements from any of the three social media platforms.

Thank you for helping us spread the word about the CAI Alabama Chapter's event offerings!

Social Media Sharing Contest

Also, don't forget to recruit new members to enter into the membership drive to win another $100 visa gift card at our May 18th Chapter and November 30th Luncheon!

Back to top

Register NOW for CAI's First-Ever FREE Webinar for Members!

CAI National is offering its first-ever FREE, live webinar that will advise members on how to best respond to bully behavior in community associations. Never Be Bullied Again: Prevent Haters, Trolls and Toxic People from Poisoning Your Life will be presented by TEDx speaker and The Intrigue Expert, Sam Horn, who has firsthand experience with association bullies after serving on a community association’s board.

Members, please get a seat soon before space fills up by registering here.  Questions about the webinar can be sent to Shari Lewis at

Back to top

Who Wants to Be a Fully Protected Community Board: The Claim Game

By Joel W. Meskin, Esq., CIRMS, MLIS, CCAL Fellow

At this month's CAI Alabama Chaper Luncheon, I had the pleasure of playing the Claim Game with many community associations owners, leaders, managers and other professionals. In case you missed the luncheon, here is a summary of my presentation.

Most people choose to live in a community association to protect their two greatest assets, their home and their lifestyle.  This protection is accomplished by three basic tools.  The first is the governing documents (Articles of Incorporation, CC&Rs and By-Laws).  The second is a Risk Management Program.  Third is a dedicated board of directors and a professional community association manager(s).

The Community Association whether a condo, townhome or a single family homeowners association is a legal entity.  A separate legal entity must be managed by a natural person(s) such as a volunteer board of directors.  The board of directors is the risk manager of the community association.  Those who are familiar with the board’s duties and obligations (often referred to as their “fiduciary duty”) understand that the key element of the duty is to put the association’s interest “above” the board member, or any other units owner’s or owners’ interest(s).  The following is the board’s risk management team.

Risk Management Team

Why is director and officer liability insurance (“D&O”) necessary?  Every set of by-laws and/or declarations of covenants, conditions and restrictions include a provision that the volunteer board members will be indemnified if their decisions or conduct is challenged in the course of their service unless it is grossly negligent or willful.  If your documents do not have such a provision, immediately see a community association attorney.  Community Associations are budget driven not for profit entities.  Since “indemnification” of board members is not a budgeted item, it requires a funding mechanism.  This mechanism is D&O.  However, the consequences of board decisions and conduct are not always insured or insurable.  (D&O is also a primary funding mechanism for the indemnity provision in the management agreement between the community association and manager.  Tip:  if something is not covered by a D&O policy, it will be covered by the association’s assets or a special assessment.)

The board has two primary types of risk to manage.  The first are “wear & tear.  For all intents and purposes, these are the items set forth in the reserve study.  These risk items are those items we know will wear out such as a roof, building paint and parking surfaces.  These are not insurable risks under an insurance policy.  I call a properly funded reserves study as insurance for the uninsurable risk.  It ceases to amaze me that boards do not fund reserves as recommended.  Unlike the insurance policy, the reserve study is not going to be non-renewed.  However, it can give rise to a claim if it is not properly funded as a breach of fiduciary duty.  Very often, the decision not to fund as recommended is to save unit owners money which is in direct contravention of the board’s fiduciary obligation.  Pay a little now or pay a lot later!

The second type of risk is “unexpected perils.”  The unexpected perils, perils that at guaranteed to occur, are what are insured.  However, just because the unexpected peril is the result of a board decision or conduct does not automatically mean it is covered under a D&O policy.  First, not every peril is covered under a D&O policy as it may be covered under a separate policy.  The most common perils that are not covered under the D&O policy are “bodily injury” and “property damage.”  These are covered in the normal course under a general liability policy.  In addition, costs to comply with fair housing or EEOC orders, the cost to redo an elections or the cost to undo and/or correct an architectural variance decision would not be covered.

Other perils that are not covered under some D&O policies are perils that are excluded, because the insurer chose not to include those perils, or because those perils increase the cost of insurance and the boards choose not to pay for the broader coverage.  Very often, boards are not aware of the narrower coverage, because they do not demand that their insurance professional explain coverage to the board itself.  The coverage that often falls into this latter category include defense of alleged breach of third party contracts, defense of failure to obtain or maintain insurance, discrimination (including emotional distress damages from discrimination), employment practices liability, or those policies that still do not provide coverage for non-monetary claims.

What are the most common D&O claims?  Based on the above, would these be covered? 



Not Covered

It Depends

Bodily Injury




Property Damage (including Loss of Use




Removal of Board Member








Employment Practices Liability




Architectural Application Decision




Americans with Disability Act




Emotional Support Animal




Assessment Challenge








Breach of Third Party Contract




Failure to Maintain or Obtain Insurance




Construction Defect Claims








* If the policy covers non-monetary claims it is covered and if the policy does not it is not covered.

In addition to what is or is not covered under a D&O policy, there are some key policy definitions and procedural items that must be understood.  These include what is a “Claim”, a “Wrongful Act” or a “Prior and Pending Proceeding Exclusion.”  In addition, the D&O policies are “Claims Made and Reported” policies.  These provisions have dire consequences.  These items are beyond the scope of this article.

In conclusion, having insured 80,000 or so community associations nationwide and having touched between 5,000 and 6,000 director and offer liability claims, I have determined that there are two primary factors underlying most claims.  First, most unit owners do not read the governing documents before closing on their unit.  Second, the volunteer board members turn their positions into something it is not.

To help Association Boards avoid claims, they may want to do a self-audit and review the "Board Duties and Obligations" worksheet and see how many of the following items can be answered in the positive. Click here to view the worksheet.



Back to top