Florida Updates Director Reliance Rules: What Board Members Should Know
The Florida Legislature recently approved House Bill 797, effective July 1, 2026, which includes a targeted update to the standards governing directors of corporations under Florida Statutes Chapter 617. If enacted, the new law would take effect on July 1, 2026. Since most homeowners’ associations and condominium associations operate through not-for-profit corporate structures, this change is relevant to board members of both HOAs and condominiums.
Section 720.303, Florida Statutes, which governs homeowners’ associations, provides that the officers and directors of an association are subject to s. 617.0830 and have a fiduciary relationship to the members who are served by the association. For condominium associations, Florida Statute 718.111 expressly provides that officers, directors, and agents must discharge their duties in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner they reasonably believe to be in the best interests of the association. This statutory standard aligns with, and incorporates, the principles set forth in Florida Statute 617.0830. As a result, the recent updates to Section 617.0830 apply broadly to both condominium and homeowners’ association board members.
What Changed?
The amendment revises Florida Statute 617.0830, which addresses the general standards of conduct for directors. Previously, the statute allowed directors to rely on information provided by legal counsel, public accountants, or other experts, so long as the director reasonably believed the matter was within that person’s professional or expert competence. Now, the statute clarifies that directors may rely on those individuals if they are retained by the corporation or a board committee and expands the standard to include not only matters within the person’s expertise, but also situations where the director reasonably believes the person “merits confidence.”
Why It Matters
While this is a modest revision, it provides additional clarity and flexibility for board members of both condominium and homeowners’ associations. The inclusion of individuals “retained by the corporation or a committee” and the broader “merits confidence” standard may give directors more comfort when relying on qualified professionals and advisors in fulfilling their duties.
Takeaway
This update does not fundamentally change directors’ fiduciary obligations, but it reinforces the importance of reasonable reliance on qualified professionals when making decisions. Board members, whether serving a condominium or HOA, should continue to act in good faith, exercise due care, and ensure that any reliance on third parties is reasonable under the circumstances.
Navigating statutory changes can be challenging, especially when they intersect with your governing documents and day-to-day operations. If you have questions about this update or need guidance on board responsibilities and compliance, our firm is here to help.
