Can Hoa Board Members Be Sued? 

You’re almost certainly a faithful and anxious citizen in the event you not solely reside in a typical curiosity or deliberate unit improvement (a CID or PUD) but additionally are on the board of administrators (the “Board”) of your householders’ affiliation (HOA). Congratulations in your efforts in retaining your improvement a pleasing place to reside!

Nonetheless, many residents are hesitant to serve on the HOA’s board. They’re involved that board participation could expose them to authorized motion. Is an HOA board member personally accountable for the expense of hospital payments and different damages if a house owner slips, falls, and fractures a leg whereas strolling on the swimming pool deck, for instance, as a result of the HOA is answerable for sustaining the event’s widespread areas?

The reply is “not very doubtless.” Though board members are sometimes talked about in HOA circumstances, they’re seldom discovered personally accountable. Click on right here for extra. 

Why are HOA board members sued — and what occurs subsequent

When plaintiffs (or plaintiffs’ attorneys) sue an HOA for damage, they usually determine particular person board members and the HOA itself. It is a widespread negotiating method reasonably than a real notion {that a} board member is immediately answerable for the state of affairs. The rationale is that the potential for private culpability will drive a extra expeditious or advantageous dispute settlement.

Board members, however, are usually solely personally accountable for HOA considerations in the event that they break a fiduciary obligation to the HOA; in different phrases, if the plaintiff can show that the board member acted negligently, willfully, in dangerous religion, or past the board’s jurisdiction. In such a lawsuit, the court docket ceaselessly judges early on that the plaintiff has not equipped such proof and dismisses the case in opposition to particular person board members.

See Fiduciary Duties of HOA Board Members for additional data on an HOA board member’s fiduciary obligation (and methods to keep away from breaking it).

How HOA insurance coverage may help board members restrict their legal responsibility

If you’re personally named in a lawsuit attributable to your acts on an HOA board, the Administrators and Officers (D&O) insurance coverage offered by your HOA will almost certainly cowl you. A good D&O coverage will compensate you for any charges and expenditures incurred attributable to your actions as a board member, together with any lawsuit prices. Test along with your HOA to see whether or not it has D&O insurance coverage and, if that’s the case, what sort of safety it offers. 

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