April 16, 2010

This week's tip offers advice for members of the homeowners association's board of directors who find themselves in court for actions they've taken as board members. If you've been sued personally, remember these tips:

1. It's not unusual. "Very often a disgruntled homeowner will sue the condo association and board members individually because the plaintiff believes it will put tremendous pressure on the board," says Robert Galvin, a partner at Davis, Malm & D'Agostine PC in Boston who specializes in representing condos and co-ops. "The homeowner's lawyer can say, 'If you agree to rescind this policy my client disagrees with, we'll drop the lawsuit.'"

2. Your association's insurance carrier will often defend you. You're likely covered if your association has directors and officers insurance. "All the associations we represent have D&O insurance, and their insurance company will defend them in such suits," says James Donnelly, president and CEO of Castle Group, a property management company in Plantation, Fla., that manages 55,000 association units. "Lawsuits against individual board members are rare, but when it happens, that's why you have insurance."

   "There may also be coverage under your association's general liability policy," says Bob Tankel, principal at Robert L. Tankel PA in Dunedin, Fla., a law firm that advises associations.

Those aren't the only things you must know if you've been sued as a board member. See our brand new articles for 7 Things You Must Know If You're Sued Personally for Board Actions.

Best regards,
Matt Humphrey
President