□ Obtain Professional Liability Insurance (errors and omissions insurance)
□ Obtain a Business Owners Policy (BOP)
□ Obtain Commercial General Liability (CGL) Insurance
□ Become (if possible) a named or additional insured on Association’s Directors and Officers Liability Insurance
□ Become named or additional insured on Association’s CGL Insurance
□ Obtain Fidelity Insurance
Management Agreement
□ Clearly establish the relationship – independent contractor, agent, employee, etc.
□ Clearly define responsibilities and scope of duties
□ Require notice of breach and opportunity to “cure” before Association can terminate
□ Require some from of ADR to resolve dispute
□ Limit time for Association to bring suit for negligence or breach of any duty
□ Require Association to allow manager access to records of Association in event of a claim
□ Clearly define what Manager is not responsible for
□ Terms of Agreement should be consistent with any limitations in Association’s governing documents
□ Clearly define who Manager is to take direction from
□ Provide for at least a yearly evaluation from Board
□ Provide for a mechanism the permits communication directly with Membership if deemed appropriate by Manager
□ Include an indemnification clause with a provision for attorney fees
□ Include a hold harmless provision which includes attorney fees
□ Include a covenant not to sue
□ Include non-waiver and entire Agreement clauses
□ Clafify management company responsibilities upon termination
□ Clarify ownership of records
□ Include a survival clause for warranties, indemnifications, etc.
Management Practices
□ Document in writing all disagreements with Association
□ Document in writing all action taken by Association against your advice
□ Maintain complete and detailed log of all telephone calls received
□ Avoid all conflicts of interest and disclose and document those you can’t avoid
□ Encourage Association to get a yearly audit
□ Do not comingle one Association’s funds with another Association’s funds
□ Encourage Association to develop a long-term replacement reserve program
□ Provide timely and accurate financial information to Association
□ Know your limits; know when something is outside your expertise
□ Do not hold yourself out as an expert in areas you are not
□ Do not preform services outside of the scope of the Management Agreement
□ Be familiar with Association’s governing documents and state statutes
□ Obtain more education and training