AB 1412 (Choi). Common interest developments: volunteer officers: liability.

liability protection

Would extend the limitation on the personal liability of a volunteer officer or director in a mixed use development in which that director does not own more than two residential separate interests.

Current Status: Pending

FindHOALaw Quick Summary:

Existing law limits the personal liability of a volunteer officer or director of an association that is exclusively residential for tortious acts or omissions, provided that the act or omission be made in good faith and within the scope of the authority of the board.

This bill would amend Civil Code Section 5800 to extend liability protection to volunteer officers and directors of mixed use developments, provided that the volunteer officer or director does not own more than two residential units.

**UPDATE: On March 23, 2017, the proposed text of AB 1412 was changed to also amend Civil Code Section 4041 to authorize the association to use the last address provided in writing by the owner, when an owner fails to annually provide his or her address to the association to which notices from the association are to be delivered:

(c) If an owner fails to provide the notices set forth in paragraphs (1) and (2) of subdivision (a), the last address provided in writing by the owner or, if none, the property address shall be deemed to be the address to which notices are to be delivered.

**UPDATE: On May 15, 2017, the proposed text of AB 1412 was changed to limit the liability of a volunteer director in a mixed use development when the volunteer is a tenant of a residential separate interest:

(e) This section shall only apply to a volunteer officer or director who is a tenant of a residential separate interest in the common interest development or is an owner of no more than two separate interests and whose ownership in the common interest development. development consists exclusively of residential separate interests.

To read the current text of AB 1412, click here to the view the bill’s page on the California Legislature’s website. FindHOALaw will continue to track AB 1412 as it progresses through the Legislature. 

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View more info on AB 1412
from the California Legislature's website

Related Topics

Related Statutes

Related Case Law

  • Palm Springs Villas II HOA v. Parth
    (2016) 248 Cal.App.4th 268

    [Fiduciary Duty; Business Judgment Rule] The Business Judgment Rule does not automatically shield a HOA director from liability that may result from the director’s failure to exercise reasonable diligence or failure to act within the scope of the director’s authority under the HOA’s governing documents.

Related Links

Tendering Lawsuits Brought Against the HOA - Published on HOA Lawyer Blog (November 14, 2013)   Business Judgment Rule Does Not Protect the Willfully Ignorant - Published on HOA Lawyer Blog (August 17, 2016)