Definition : Director - Conflict of interest

La webradio du mercredi 15 mars 2023 a porté sur la fraude en copropriété et les mécanismes à mettre en place pour l’éviter. Une copropriété n’est pas à l’abri d’une fraude. Parmi ceux qui pourraient la commettre figurent les administrateurs, les copropriétaires, le gestionnaire de la copropriété, les fournisseurs de services et les tiers. Par conséquent, il serait sage d’observer les comportements d’éventuels suspects, afin d’y déceler des actes potentiellement frauduleux. Il ne saurait être question de mener une chasse aux sorcières dans un immeuble, néanmoins, certains signes avant-coureurs devraient susciter la méfiance et commander la vigilance. Comment identifier ces actes frauduleux et se prémunir des conséquences économiques relatives à ce type d’activité criminelle?

The juridical personality of the syndicate is distinct from the one of the co-owners and directors. His acts are binding only on himself, besides for the exceptions provided by law. The faults committed by the syndicate have consequences only on its own civil liability and not on the directors. Under these conditions, they are held harmless by the syndicate and assume no responsibility for any costs, expenses, charges or losses they have incurred for the administration of the building and the syndicate. This is the basic principle, but it is important to bring several nuances to it. Indeed, a director must never lose sight of the interest of the community of co-owners.

Être administrateur de copropriété n'est certes pas toujours facile. Cette charge est lourde de responsabilités et comporte des hauts et des bas. Mais l'important, c'est qu'à la fin de son mandat, tout administrateur ait le sentiment du devoir accompli.

The presence of a Board of Directors is mandatory in a co-ownership. It is the executive body of the syndicate and its legal representative. Its members act as the mandataries of the syndicate. When a co-ownership is newly constituted, the declaration of co-ownership generally provides for the appointment of a interim director, who exercises the functions of the Board of Directors until the Meeting of co-owners appoints a new board of directors. This transitional period is generally delicate because of the necessarily numerous and complex problems relating to defects in workmanship, latent defects and construction defects. And this is not to mention that the transitional administrator set up by the developer may have a negative role: protect the developer and transfer to the co-ownership of charges incumbent in principle on the developer.  Its appointment Usually, it is the developer who designates him, in accordance with a provision in the declaration of co-ownership (By-laws of the Immovable). Often he appoints one of his  representatives to act as the interim director of the syndicate.

Your co-ownership is exposed to various types of risks, such as fire, water damage, theft and vandalism. Among these risks, there is one that is often overlooked, that of fraud. Those who can commit it are sometimes unsuspected or unsuspecting people. This is the case for the director, the co-owner, the condo manager, service providers and third parties. Therefore, it would be wise to observe the behaviour of potential suspects, in order to detect potentially fraudulent acts. There can be no question of conducting a witch hunt in a building, nevertheless, certain warning signs should arouse mistrust and command vigilance.  

Most co-ownership directors assume this activity free of charge, effectively excluding the collection of any amount of money. But, contrary to popular belief, they can be paid. Usually, the remuneration granted to a director is mainly symbolic and is not similar to a remuneration similar to that paid to a condominium manager. Their remuneration takes various forms: salary, honorariums and attendance fees, just to name a few. This financial compensation, a part of the administrative expenses of the co-ownership, may also include the reimbursement of some expenses incurred by a director.

The director of a co-ownership is called to play a key role in the sound management of the co-ownership and preservation of the patrimony of the co-owners. To strengthen and maintain the relationship of trust with them, every director must be fair, honest and loyal toward the Syndicate and the co-wners. The director must also respect ethical standards and the Code of conductstipulated by the Civil Code of Quebec and the declaration of co-ownership. In case of doubt, directors must act according to the spirit of those principles and rules. They must also arrange their personal affairs in such a manner that they cannot interfere with the performance of their duties.

The members of the board of directors play a key role in the co-ownership: they must be involved in the life of the building to ensure the proper management of the co-ownership and the well-being of the co-owners. Usually appointed by the Meeting of the co-owners, the director is a member of the Board of Directors of the syndicate. Its duties are to make decisions on the directions and priorities of the Syndicate. Such Decisions are without limitation for the purpose of the preservation of the immovable and also the management and maintenance of common portions. People who are thinking of becoming a director of a syndicate of co-owners have or should ask themselves certain questions before submitting their candidacy for this office. Do I have the required qualities and skills?