Title
Code of Ethics for HOA Officers
Law
Hlurb Memorandum Circular No. 04, S. 2014
Decision Date
Mar 21, 2014
HLURB's Code of Ethics and Ethical Standards mandates transparency and integrity for officers and board members of homeowners associations, prohibiting conflicts of interest and ensuring accountability in governance.

Law Summary

Definitions

  • Officers: Elected executive officers such as President, Vice President, Secretary, Treasurer, etc.
  • Board Members: Elected members of the Board of Directors/Trustees.
  • Conflict of Interests: Situations compromising an officer/board member's integrity due to personal/professional interests involving themselves or relatives up to the fourth civil degree.
  • Perceived Conflict of Interests: Acts likely to cast doubt on impartiality or trustworthiness.
  • Disputes Mechanism: Grievance Committee for mediation within the association.
  • HLURB: Housing and Land Use Regulatory Board.
  • Internal Rules: Circulars, orders, regulations promulgated by the association's board aside from by-laws.

Ethical Standards and Rules of Conduct

  • Primacy of Association Interests: Officers/board members must prioritize collective association interests over personal gains.
  • Use of Position: Prohibition against exploiting position to advance personal interests.
  • Collective Action: Board members should act collectively, avoiding individual decisions that may cause conflicts of interest.

Disclosure, Inhibition, and Abstention

  • Duty to disclose conflicts of interest in writing at earliest opportunity.
  • Officers must inhibit themselves from participation in negotiations involving conflicts, except to provide requested input.
  • Abstain from voting on transactions where conflict exists, with abstention recorded in meeting minutes.
  • Disclosure of such dealings to homeowners is required.

Prohibition of Partisan Politics

  • Officers must not use association resources or property for partisan political activities.
  • Associations shall not contribute to political parties or candidates.
  • Facilities cannot be used for campaigning or advantage to political entities.

Business Interests and Professional Practice

  • Officers must disclose any business involvement or financial interests upon assuming office.
  • Professional services should not be rendered to the association if likely to cause conflict of interest.

Transactions Involving Families and Related Parties

  • Personal service contracts involving officers or relatives up to fourth civil degree must be disclosed prior to execution.

Dealings with Vendors and Contractors

  • Transparency is required in all business dealings.
  • Officers must not use position to benefit personal or professional interests indirectly or directly through endorsements.

Solicitation and Acceptance of Gifts

  • Officers are prohibited from accepting or soliciting gifts, favors, or anything of monetary value intended to influence official decisions.

Responsibilities and Discipline

  • Officers must respect and uphold the association’s constitution, by-laws, and internal rules.
  • Regular attendance and decorum in meetings is mandatory, respecting majority decisions and expressing dissent professionally.
  • Officers should participate in information campaigns and advocate for public programs affecting the association.
  • Cooperation with investigations regarding disputes or offenses is required.
  • Officers charged with offenses should take official leave during investigations.
  • Disputes should first be exhausted within the association's dispute mechanisms before pursuing legal actions.

Respect for Law and Authority

  • Officers must obey lawful orders and judgments from authorities in legal controversies involving the association.

Complaints Mechanism and Investigation

  • Complaints may be formal or anonymous and are to be investigated confidentially by an investigation committee.
  • Findings of absence of probable cause lead to dismissal; presence of probable cause leads to proceedings where the accused officer must be informed and allowed to respond.
  • Protection and safety of witnesses are ensured throughout.

Sanctions for Violations

  • Violations constitute misconduct and subject the officer to sanctions per the association’s by-laws.
  • If by-laws are silent, penalties range from fines (Php 5,000.00 to Php 50,000.00) to permanent disqualification from office.
  • HLURB may impose additional disciplinary actions upon complaint.

Scope and Effectivity

  • The Code applies to all homeowners associations under RA 9904.
  • Severability clause ensures unaffected provisions remain valid if any part is declared invalid.
  • The Code binds all present and future officers and board members immediately upon adoption and upon signing.

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