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.