Monday April 13, 2026
What is the SC Nonprofit Corporation Act?
The South Carolina Nonprofit Corporation Act is the state law that sets default rules for how nonprofit corporations are organized and run. It sets rules on member meetings, board authority, officer roles, corporate records, member inspection rights, and more.Does the SC Nonprofit Corporation Act apply to HOAs?
Many HOAs are formed as nonprofit corporations, so these rules often shape day-to-day governance even when your governing documents are the first place you look.SC Nonprofit Corporation Act vs. the Homeowners Association Act
If your HOA is incorporated as a nonprofit, the Nonprofit Corporation Act sets the core “corporate” rules for things like board meeting procedures, voting, board authority, and owner inspection of corporate records.The Homeowners Association Act adds HOA-specific requirements, but includes a few carve-outs that don’t apply to nonprofit HOAs.
Always consult with qualified legal counsel and your professional property management partner when determining which parts of the law apply to your community.
Key provisions of the Act
Annual meetings and member voting
Nonprofit corporations with members must hold an annual meeting of members, at a time stated in or fixed in accordance with the bylaws (S.C. Code Ann. § 33-31-701). This is where elections, major updates, and owner Q&A often happen.Recordkeeping
The nonprofit statute says the corporation must keep permanent records like minutes of member and board meetings, actions taken without a meeting, and committee actions, and it must maintain appropriate accounting records (S.C. Code Ann. § 33-31-1601).Owners inspecting records
Owners often have the right to inspect certain HOA records, but requests usually need to be made in writing and with at least five business days’ notice (S.C. Code Ann. § 33-31-1602). For more sensitive records (like accounting records or membership lists), the Act generally requires a written request made in good faith and for a proper purpose, stating the purpose and the records requested with “reasonable particularity,” and limited to records directly connected to that purpose.Director duties and decision-making
Directors must act in good faith, with the care an ordinarily prudent person would use, and in a manner they reasonably believe to be in the best interests of the HOA (S.C. Code Ann. § 33-31-830). It also recognizes that directors can rely on information from professionals they reasonably believe are reliable, which is why boards often do better when major decisions are supported by reports and written recommendations from experts.Conflicts of interest
A conflict of interest does not automatically cancel a contract under the South Carolina Nonprofit Corporation Act. The Act recognizes that a conflicted transaction can still be valid if it was fair to the association at the time it was entered into. If the board is dealing with an active conflict of interest, they may still be able to move forward if they follow the safeguards in the statute (S.C. Code Ann. § 33-31-831):- Disclose the facts about the director’s relationship or interest.
- Let a majority of the directors who do not have the conflict approve the transaction (not just one director). If your HOA is a mutual benefit corporation, the members can approve it instead.
- Document the disclosure and the approval/ratification vote.
Board quorum and voting rules
The Act says quorum can never be set lower than the greater of one-third of the directors, or two directors total (S.C. Code Ann. § 33-31-824). Most associations use a higher number, and the usual default is a majority of the directors in office immediately before a meeting begins, unless your documents say something different. Once quorum is met, most decisions pass with a majority vote of the directors who are present, unless a higher vote is required.Committees
If your governing documents allow it, the board can create committees made up of two or more directors and give them certain responsibilities (S.C. Code Ann. § 33-31-825). Committees can help with focused work, but they cannot handle major governance decisions such as changing bylaws, filling board seats, removing directors, or recommending mergers or dissolutions.This structure works well for architectural review, covenant enforcement, and finance committees because they can move projects forward while key decisions remain with the full board or the membership.
What HOAs cannot do
Even with broad authority, HOAs still have limits on things they can’t do:- Discriminate in housing-related rules or enforcement. South Carolina’s Fair Housing Law bars discrimination in housing based on protected characteristics (and federal fair housing law may also apply).
- Ignore their own governing documents when taking actions that require specific procedures (like elections, budget actions, or rule adoption).
- Deny proper records inspection requests when the request follows the applicable statute and process.
- Enforce rules that were never properly adopted or properly recorded/communicated when recording/notice requirements apply to the community. Read our guide to unenforceable HOA rules in South Carolina.
- Make “one-off exceptions” that turn into selective enforcement. Even when an exception is well-intended, inconsistency is where disputes grow.
Staying aligned with your governing documents
State statutes set the baseline, but your declaration and bylaws often control the details: board size, election timing, use restrictions, architectural authority, fines, and enforcement steps. When boards get into trouble, it’s often because the HOA acted based on “how we’ve always done it” instead of what the documents require.A strong best practice is a short “governance calendar” that tracks: annual meeting timing, budget season, election windows, renewal dates for key vendors, and the annual recording checklist where required.
About FirstService Residential
As North America’s leading property management company, FirstService Residential serves South Carolina HOAs with local expertise backed by national resources. Our teams support board members with meetings, recordkeeping, financial management, resident communication, and 24/7 customer care. This way, board members can focus on long-term goals instead of day-to-day administration.Contact a member of our team today to learn more about how we can serve your community.
This information is provided for general informational purposes only and is not intended to constitute, and should not be relied upon as, legal, regulatory, financial, or operational advice, or as a representation or guarantee of any specific services, capabilities, or outcomes. Property management needs, regulatory requirements, market conditions, and available services vary by jurisdiction, property type, and community. FirstService Residential provides services through locally based affiliates and associates, and services and results may vary by community, region, contractual terms, and applicable law.