Moving away won’t shield ex-association board member

Question: Is a homeowner association legally responsible for the actions of any board member who has harmed any member of the association? What if the board member has moved away from the association when a lawsuit is pending against it?

Answer: Homeowner associations are required to carry insurance coverage to protect the membership and those who serve on the board from liability for actions conducted by board directors in good faith during the ordinary course of business.

Typically, your association’s insurance coverage should protect the homeowner association from a board member who has harmed an association member. Titleholders may sue board directors if their actions violate their duties to the association or the homeowners, or whose acts harm others when those board members are acting outside the scope of a director’s duties. The association’s insurance policy is not likely to protect the director in that latter case. Even if the association’s insurer does defend that errant director, the insurance company may insist on being reimbursed if the director is found liable and ordered to pay damages by a court.

If the individual board member was initially named in the lawsuit and served with a summons and complaint in accordance with the law at the time the lawsuit began, the fact that this member has moved away does not change his or her potential liability for any damages he or she may have caused. If the board member was not served with a copy of the summons and complaint at the time but was added to the lawsuit at a later date, he or she may still be served and held liable.

Merely selling one’s unit and moving away will not protect a former board member from being sued or from being held liable for actions taken while sitting as a board director. Some owners have even hired private investigators to track down former board members.

Send questions to Box 10490, Marina del Rey, CA 90295 or e-mail noexit@mindspring.com.