Article Archives >> To the Point

I have been the president of our homeowners association for the past 11 years but I will be selling my condo soon and resigning as president.  I notified the board in January but they have basically ignored the situation. There are three other board members, and only one of those actually comes to meetings.  Now, they are calling for an audit/review of the association's financials.  I've put in countless hours running the association (doing literally everything).  At this point I feel that if they want to "find cause" they will.  One board member has even brought up lawsuits.  What can I do to protect myself from frivolous and potentially costly legal action?

This sounds like one of those situations in which no good deed goes unpunished.  Your primary legal protection should already be in place, however, if the founders of your association included standard individual protections in your governing documents.  Your governing documents ought to limit your personal liability only to those situations that would involve your personal self-dealing or intentional misconduct (which I assume is not the case) and ought to include good indemnification language to protect you if you do get sued.  (See Ready Reference Page: “Bylaws Function as ‘Constitution’ of Nonprofit Corporations”)  The association should also have directors and officers insurance in place to provide the resources to protect you if you get sued.  Even if your decisions were wrong, you should not be personally liable if they were made in good faith and were what you believed to be in the best interests of the association. Careful preplanning could have reduced your risk considerably.

As a practical matter, you ought to cooperate with them as much as possible in the transition and help them find replacement members of the board to carry on when you leave.  Physicians have learned that showing concern for patients is one of the best ways to avoid malpractice litigation and those lessons should apply here. Some people are just jerks, but even they can realize eventually that litigation is seldom the answer in a situation like this.

9/20/2011

Article Archives >> To the Point

Nonprofit Mergers, Acquisitions and Affiliations

Pre-recorded Webinar -
Listen Today

With pressure mounting on nonprofits to consider affiliations with other organizations, this workshop is designed to help you better navigate the world of mergers, acquisitions and affiliations. Unlike the corporate world, there are no financial "matchmakers" to help nonprofits identify successful partners for a merger. Learn more in our pre-recorded webinar.

Receive the weekly question by e-mail

Sign up and receive FREE:

Weekly question and answer

Notice of each full edition
and its free stories

Report on 501(c)(3) electioneering

 

What our readers say about Nonprofit Issues

Once again you've tackled a tricky question and explained it so we all can understand the issue.--M.V.

Thank you for your informative and keen advice on nonprofit matters. I believe it's a unique and concise place to get answers to this often wispy area called nonprofit. --R.T.

 

Have a question?

If you can't find your answer, submit a question and Don will pick one question a week to answer online and to include in our weekly e-mail notice.

Other ways to
find answers:

Talk to the Editor
Next Conference Call:
Wednesday, April 23, 2014

Participate in this bi-monthly telephone seminar conference call and ask your questions directly to Editor Don Kramer.

Access the entire site
($9.95/24 hours, $17.95/3 months).


  Help

Nonprofit Issues Live
Full Day Program
A well-received full-day program that covers the current hottest topics in nonprofit law. Qualifies in Pennsylvania for Continuing Education credits.

Speaking Engagements
Don is available for programs and speaking engagements ranging from a one-hour presentation to a full-day primer on nonprofit law. Contact us if you are interested in having him speak at your program.


None of the information on the Nonprofit Issues Website should be deemed legal advice or
should be acted upon without prior consultation with appropriate professional advisors.
Materials prepared by Nonprofit Issues contained in these pages is copyrighted by Nonprofit Issues, Inc., 2009-2012.

Home | Article Archives | Ready Reference | Ask the Editor | Bookstore | About Us

Change Profile/Password
Subscribe or Renew

Free E-notice

Nonprofit Issues, Inc.
P.O. Box 482
Dresher, PA 19025
(215) 542-7547 FAX (215) 542-7548
1-888-NP-Issue

E-mail Us