CMCA FREE CMCA MCQ Questions and Answers 2 — Questions and Answers
Question 1: Which of the following best describes the duty of care owed by HOA board members?
- Making every decision unanimously
- Acting with the care an ordinarily prudent person would use in a similar position under similar circumstances (Correct answer)
- Hiring only licensed professionals for all tasks
- Attending every board meeting without exception
Correct answer: Acting with the care an ordinarily prudent person would use in a similar position under similar circumstances
The duty of care requires board members to act with the diligence, attention, and skill that a reasonably prudent person would exercise when managing the affairs of a nonprofit organization.
The duty of care, along with the duty of loyalty and duty to act within authority, forms the three core fiduciary duties of community association board members. Meeting this standard typically means being informed, attending meetings, reviewing financials, and asking questions before voting.
Question 2: A community association's architectural review committee primarily serves to:
- Enforce collection policies for delinquent assessments
- Review owner improvement requests to ensure they comply with architectural guidelines and community aesthetic standards (Correct answer)
- Conduct the annual financial audit
- Manage employee performance reviews
Correct answer: Review owner improvement requests to ensure they comply with architectural guidelines and community aesthetic standards
The architectural review committee reviews homeowner applications for exterior modifications, improvements, and new construction to ensure compliance with the association's architectural guidelines and CC&Rs.
The ARC process protects the community's visual harmony and property values by ensuring modifications such as additions, paint colors, fences, and landscaping changes conform to established standards. Consistent ARC enforcement is important to avoid selective enforcement claims.
Question 3: Transition documents provided by the developer at turnover typically include:
- Only the CC&Rs
- Governing documents, financial records, reserve study, insurance policies, maintenance records, vendor contracts, and as-built plans (Correct answer)
- Personal financial statements of the developer
- Marketing materials for unsold units
Correct answer: Governing documents, financial records, reserve study, insurance policies, maintenance records, vendor contracts, and as-built plans
At turnover, the developer must provide a comprehensive package of association records so the incoming owner-controlled board can understand the community's financial, physical, and legal condition.
A complete turnover package allows the new board to evaluate reserve fund adequacy, identify deferred maintenance, review existing contracts, and understand the association's legal posture. State statutes typically list the documents that must be provided at turnover.
Question 4: An association manager notices that a homeowner has installed a satellite dish on the exterior of their unit. The manager should:
- Immediately have the dish removed at the owner's expense
- Review the CC&Rs and applicable federal OTARD rules before taking any enforcement action (Correct answer)
- Send an automatic fine notice
- Do nothing since federal law always permits satellite dishes anywhere
Correct answer: Review the CC&Rs and applicable federal OTARD rules before taking any enforcement action
The FCC's Over-the-Air Reception Devices rule limits an association's ability to restrict satellite dishes on areas within the exclusive use of the owner, so the manager must review both the CC&Rs and the OTARD rule before proceeding.
The OTARD rule generally prohibits restrictions that impair reception or unreasonably delay installation on areas the resident controls. Associations may still regulate placement for safety or aesthetic reasons if they do not impair reception. Enforcing a blanket satellite dish ban without considering OTARD can expose the association to FCC complaints.
Question 5: A meeting packet provided to board members before a board meeting should typically include:
- Only the meeting agenda
- The agenda, previous meeting minutes for approval, financial reports, management report, and supporting materials for action items (Correct answer)
- Personal contact information for all homeowners
- Vendor advertising materials
Correct answer: The agenda, previous meeting minutes for approval, financial reports, management report, and supporting materials for action items
A complete pre-meeting packet gives board members the information they need to make informed decisions, fulfilling their duty of care by ensuring they are adequately prepared before voting.
Sending meeting packets in advance, typically five to seven days before the meeting, allows board members to review financials, read the manager's report, and consider action items. This makes meetings more efficient and decisions better informed.
Question 6: In community association management, estoppel certificates are most commonly used:
- To enforce parking violations
- To certify the status of assessments owed on a unit at the time of a real estate sale or refinancing (Correct answer)
- To amend the CC&Rs
- To document board member conflicts of interest
Correct answer: To certify the status of assessments owed on a unit at the time of a real estate sale or refinancing
An estoppel certificate issued by the association at the time of a property sale certifies the current status of assessments, any outstanding violations, and other financial obligations, binding the association to those representations.
At closing, the title company or lender requires an estoppel certificate to confirm what the buyer is assuming in terms of assessments owed, transfer fees, and pending violations. Once issued, the association is legally prevented from claiming amounts greater than those certified.
CMCA FREE CMCA MCQ Questions and Answers 2
Which of the following best describes the duty of care owed by HOA board members?