Do individual HOA board members have personal liability if sued individually for illegal or excessive actions they maybe respons

Asked about 4 years ago - North Las Vegas, NV

Do individual HOA board members have personal liability if sued individually for illegal or excessive actions they maybe responsible for as a result of decisions they made as a board member ? Does the HOA board membership afford them any spacial protection from personal
liability outside that board membership?

Attorney answers (2)

  1. Shawn G. Pearson

    Contributor Level 11

    Answered . It is impossible to say based on the facts provided whether a Nevada HOA board member would have personal liability. Generally speaking, HOA board members are entitled to indemnification from suit pursuant to NRS 116.31036. That means that if a board member *is* liable personally, then the HOA is required to pay any damages assessed against the board member. In other words, even if the board member is personally liable, it's the homeowners, collectively, who will end up bearing the cost. Notably, indemnification is not available in cases of "willful or wanton misfeasance or gross negligence." In those cases, the board member is not entitled to indemnification. That statute also prohibits punitive damages against a board member for liability arising out of actions taken in the board member's official capacity.

    Another thing to keep in mind is that most HOAs are organized as non-profit corporations. NRS 82.221 provides for a waiver of monetary liability against directors and officers of nonprofit corporations, except in cases of "intentional misconduct, fraud or knowing violation of the law." Now the HOA's Articles of Incorporation can impose a higher standard, but that's rare.

    The foregoing is not legal advised and is not intended to (and does not) create an attorney client relationship.

  2. Paul Stephen Johnson

    Contributor Level 14

    Answered . I am not admitted in Nevada, which may have special rules about the liability of Board directors of a HOA. However, the by-laws may discuss the liability of individual members. It is likely that the HOA has some type of fidelity insurance to protect the individual memebrs in the event of a suit for negligence or malfeasance.

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