Board Member with Lawsuit

I've never heard of such a clause.

If one was proposed, I would vote against it because it's possible the individual bringing complaints is correct. I'm not saying that is the case with your Association. I'm simply saying that such a clause could prevent an individual who is trying to do the right thing could be forced to recuse themselves from votes.

One needs to look at any bylaw amendment from various angles so an informed decision can be made.

I will offer this from the VA Non-stock corporation act:

§ 13.1-871. Director conflict of interests

A. A conflict of interests transaction is a transaction with the corporation in which a director of the corporation has an interest that precludes him from being a disinterested director. A conflict of interests transaction is not voidable by the corporation solely because of the director's interest in the transaction if any one of the following is true:

1. The material facts of the transaction and the director's interest were disclosed or known to the board of directors or a committee of the board of directors and the board of directors or committee authorized, approved or ratified the transaction;

2. The material facts of the transaction and the director's interest were disclosed to the members entitled to vote and they authorized, approved or ratified the transaction; or

3. The transaction was fair to the corporation.

B. For purposes of subdivision A 1, a conflict of interests transaction is authorized, approved, or ratified if it receives the affirmative vote of a majority of the disinterested directors on the board of directors, or on the committee. A transaction shall not be authorized, approved, or ratified under this section by a single director. If a majority of the disinterested directors vote to authorize, approve or ratify the transaction, a quorum is present for the purpose of taking action under this section. The presence of, or a vote cast by, a director who is not disinterested does not affect the validity of any action taken under subdivision A 1 if the transaction is otherwise authorized, approved or ratified as provided in that subsection.

C. For purposes of subdivision A 2, a conflict of interests transaction is authorized, approved, or ratified if it receives the vote of a majority of the votes entitled to be counted under this subsection. The votes controlled by a director who is not disinterested may not be counted in a vote of members to determine whether to authorize, approve, or ratify a conflict of interests transaction under subdivision A 2. The director's votes, however, may be counted in determining whether the transaction is approved under other sections of this Act. A majority of the members, whether or not present, that are entitled to be counted in a vote on the transaction under this subsection constitutes a quorum for the purpose of taking action under this section.

Also, it seems recusal or stepping down wouldn't matter if the person mostly votes in the minority. I'm with Tim that maybe the others haven't listened or don't understand what the person is upset about.

No, but what you describe sounds like grounds the board would want to use the remove this person immediately from any officer positions and start a recall process with the owners.

First off, my rule of thumb is that conflicts of interest are bad. Avoiding them protects the two parties that are in conflict. *It also protects the person caught in the middle who has duties to both opponents and can't fulfill their obligations to both.* Rules that require persons in such a position to recuse themselves are not punishments - they're the opposite of punishment.

That said, whenever there is a dispute like this, hard and fast rules are not always helpful. You have to weigh the damage being done currently against the benefits of correcting the situation plus the cost of doing the correcting. I view lawsuits as a failed relationship. At worst they're a bullying tactic - a temper tantrum filed by a person who can afford such tantrums. The person filing the lawsuit has decided that whatever relationship existed prior to the lawsuit is worth sacrificing in order to get what they want. If the membership had to pay the legal costs (and possibly increased insurance rates), they may well take the position that the previous situation was better than what they have now regardless of the merit of the lawsuit.

As for the problem board member: this person wants drama, and the rest of the board has to avoid giving it to them. They're only one person - as long as the rest of the board is in agreement, the trouble maker won't affect the outcome of a vote. If the person abstains, then note the abstention in the minutes and move on. If they file a lawsuit, then they become an adverse party and *must* be excluded from discussion of the issue (especially if those discussions involve the association attorney, who will insist that the person not be present).

Assume this person will continue to act up. They want attention. They told you so: "nobody pays attention to me". The rest of the board should pay some attention in case the person raises legitimate issues - but otherwise the attitude should be "whatever" or "thank you for your comments", and you move on as if nothing unusual has happened. Make these interactions as boring as possible.