SIGNING CHECKS

QUESTION: Our bylaws require our president to co-sign all checks. However, our management company contract includes verbiage that they have authority to sign checks for all bills authorized by the board. Our president was not aware of his duty and hasn't co-signed a check in the 3+ year history of our HOA. Which takes precedence--the management contract or our bylaws?

ANSWER: Your bylaws control. Management contracts are typically permissive, i.e., the management company may sign checks, whereas bylaws are usually mandatory--the president shall co-sign checks. If your management contract is mandatory (the company must co-sign all checks), then it is time to renegotiate the contract. If the company refuses, it's time for a new management company. No reputable company would force a board into violating its duties under the bylaws. Your board should immediately set up bank signature cards on your accounts.

Updated by ADAMS KESSLER 9/14/2008