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Volunteer HOA liability.

Started by GaryW12 • 14 replies • 854 views

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GaryW12 (Alabama)
Posts: 56
Posted:
I'm thinking for running for president, vice president or director.

the HOA I have has no insurance. The current board feels that they are lawsuit-proof as they are "volunteer" and protected under the Volunteer act of 1997

Does this sound right?

I'm kinda afraid if I get on board to start enforcing covenants, that someone will try to sue for whatever reason.

Any input is helpful.
PaaN
Posts: 219
Posted:
The volunteer act does NOT protect y'all from everything.

Y'all still have Fiduciary Responsibilities.

Y'all may, in your ignorance and inexperience, commit misfeasance.

IMO: if uninsured, RUN, RUN FAST, RUN FAR
GaryW12 (Alabama)
Posts: 56
Posted:
Thats ALL i needed to hear.

I'm not going to run I don't guess. no need to stick my self in way of legal trouble, just because this board feels "lawsuit-proof".
TimB4 (Tennessee)
Posts: 21,059
Posted:
Gary,

You should be indemnified (i.e. the Association pays) if anything occurs.
Typically this is within your bylaws.

I am expecting, because I don't recall, that when you say volunteer you mean a non-mandatory Association (lots volunteer to join). If you are a mandatory Association, statutes will typically specify that you are indemnified. That said, it would be best if your Association obtained some D&O (directors & Officers) insurance.
For us, the cost is about $1,300 per year.
GaryW12 (Alabama)
Posts: 56
Posted:
Nothing in the bylaws talks about insurance or liability.

And even though the bylaws say the dues is XYZ, the board has gone so long without doing things right, they are under the impression and operate like the dues are volunteer regardless if that is the case or not.

So I don't think it is wise for anyone to get on the board, as it seems like too much of a mess to bother to fix.
MelissaP1 (Alabama)
Posts: 13,836
Posted:
Funny that is the same cop out that makes nothing change...
Former HOA President
PaaN
Posts: 219
Posted:
Quote:
Posted By GaryW12 on 09/18/2018 5:46 PM
Nothing in the bylaws talks about insurance or liability.

And even though the bylaws say the dues is XYZ, the board has gone so long without doing things right, they are under the impression and operate like the dues are volunteer regardless if that is the case or not.

So I don't think it is wise for anyone to get on the board, as it seems like too much of a mess to bother to fix.

I will wager that Florida HOA legislation and Florida not-for-profit corporate law have MANY things to say on said topics.

SHEEEEZ
RichardP13 (California)
Posts: 3,868
Posted:
Actually, insurance requirements will be in your CCRs, not your Bylaws.
GenoS (Florida)
Posts: 4,276
Posted:
Quote:
Posted By GaryW12 on 09/18/2018 3:05 PM
Does this sound right?

No.

I think anyone who volunteers to serve on a board without Directors & Officers insurance is mad.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Quote:
Posted By GenoS on 09/19/2018 11:18 AM
Posted By GaryW12 on 09/18/2018 3:05 PM
Does this sound right?

No.

I think anyone who volunteers to serve on a board without Directors & Officers insurance is mad.

I agree.
GeorgeS21 (Florida)
Posts: 3,808
Posted:
Gary,

Do some good.

Run for director, then become an officer and insist the board purchase D and O insurance ...

Do some good.
GenoS (Florida)
Posts: 4,276
Posted:
Any director at a Board of Directors meeting can bring up the subject. I don't think one would have to be an officer to suggest it. If I recall correctly, it's not that expensive althogh ours came as part of a package of policies. Standalone D&O insurance with nothing else could be more expensive. Or the fact that you haven't had any before might result in higher premiums. I don't know. Look into it, though, by all means (and don't do anything else until you have it!)
GeorgeS21 (Florida)
Posts: 3,808
Posted:
My point about being an officer is that it might allow you greater ability to drive the topic and get visibility.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
While I would not serve on a BOD without D&O insurance, there is something to be said about getting on the BOD to get things done, including pushing them to purchase D&O insurance.
GenoS (Florida)
Posts: 4,276
Posted:
Quote:
Posted By GeorgeS21 on 09/20/2018 4:39 AM
My point about being an officer is that it might allow you greater ability to drive the topic and get visibility.

Perhaps if the members don't understand the difference between directors and officers and accord more respect to what one of the officers says. When voting to approve the purchase of a D&O policy, officers are wearing their director hat when voting.

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