Duty to Investigate – Due Diligence
The duty to investigate or due diligence is one of the fiduciary duties of board members. Association board members must make a reasonable inquiry before making decisions. This does not mean they must do everything themselves. Board members can rely on other professionals such as attorneys, accountants, insurance brokers, reserve study providers, and licensed contractors to gather information for their review and discussion.
A board member cannot close his or her eyes to what is going on in the conduct of the business or the corporation and have it said that he or she exercising good business judgment.