Board Work in Co-ownership: Responsibilities and Tasks

Sitting on the board of a co-ownership involves significant responsibility. As a board member, you are responsible for the daily management and administration of the co-ownership. This includes, among other things, ensuring proper maintenance of the property, implementing decisions from the co-owners' meeting, and making decisions on matters not delegated to other organs within the co-ownership.

Legal Framework

The Co-ownership Act of June 16, 2017, no. 65 regulates the tasks and responsibilities of the board. The law sets forth, among other things, rules about:

• Election and composition of the board

• Conducting board meetings

• The board's case handling

• Misuse of position in the co-ownership

• The board's liability for damages

Composition of the Board

The board shall generally consist of three members, one of whom shall be the chairman, unless otherwise stipulated in the articles of association. There is no requirement that the board members themselves must be section owners.

In co-ownerships with eight or fewer sections, a "simplified governance model" can be adopted where all section owners comprise the board.

Election and Meetings

Board members are normally elected for a period of two years by the co-owners' meeting with a simple majority. Key points include:

1. The chairman convenes board meetings as needed

2. Board meetings are normally chaired by the chairman

3. The board is quorate when more than half of the board members are present

4. Decisions are made by a simple majority

5. At least one-third of all board members must vote for the proposal

Minutes

At the board meetings, minutes shall be kept indicating at least:

• Time and place

• Participants

• Matters considered

• Board decisions

The minutes shall be signed by all board members present at the meeting.

Duties and Responsibilities

As a board member, it is expected that you:

• Exhibit responsible ownership

• Loyally promote the co-ownership's interests

• Do not misuse your position to gain unreasonable advantages for yourself or others

Accounts and Auditing

• In co-ownerships with nine or more sections, accounts must be kept according to the rules of the Accounting Act

• Co-ownerships with 21 or more sections must have a state-authorized or registered auditor

Liability for Damages

Breach of the board's duties can lead to liability for damages, but the threshold is relatively high. It typically requires:

• Gross negligence or intent

• Simple negligence is generally not sufficient

Economy and Insurance

• Board remuneration is taxable over NOK 1,000 per year

• A director liability insurance provides security against personal losses

Conclusion

A good board is characterized by spending time understanding the rules and performing the role with sound judgment, integrity, and due diligence. In case of doubt, it is recommended to seek advice from an attorney with expertise in the area.