JC3
Posts: 290
Posts: 290
Posted:
What would happen if one board member filed suit against another, as far as director and officer insurance, state law, etc?
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suit by board member
Started by JC3 • 9 replies • 1243 views
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SusanW1 (Michigan)
Posts: 5,202
Posts: 5,202
Posted:
That would be a personal lawsuit, and unless the HOA was named in the suit, the issue is between 2 people.
What is the charge?
What is the charge?
KirkW1 (Texas)
Posts: 1,665
Posts: 1,665
Posted:
If the lawsuit has any relation to what has happened as an act of the board, then the HOA's insurance would in fact come into play to for the defendant. The insurance will not help the plaintiff.
BradP (Kansas)
Posts: 2,640
Posts: 2,640
Posted:
Kirk is right, if the basis of the suit is HOA related the defendant would have the ability to use the D & O insurance of the association. The plantiff is on their own.
NicoleO4 (California)
Posts: 160
Posts: 160
Posted:
I am most curious what is the cause of the legal action?
BrianB (California)
Posts: 2,820
Posts: 2,820
Posted:
maybe i am just thinking weird, but wouldn't it depend on the details of the case whether the D&O insurance would handle the plaintiff or the defendant, or neither?
MaryA1 (Arizona)
Posts: 7,043
Posts: 7,043
Posted:
Quote:
Posted By BrianB on 06/23/2008 8:11 AM
maybe i am just thinking weird, but wouldn't it depend on the details of the case whether the D&O insurance would handle the plaintiff or the defendant, or neither?
maybe i am just thinking weird, but wouldn't it depend on the details of the case whether the D&O insurance would handle the plaintiff or the defendant, or neither?
Brian,
Good question? How about this one. Why shouldn't it cover both as we're talking about two board members? How does the ins co decide -- draw straws???
JohnK3 (Pennsylvania)
Posts: 967
Posts: 967
Posted:
Mary,
Ins. policies typically contain one duty and one possible duty for the insurer. The duty is to "defend" an insured. The possible duty is to "indemnify," as in pay the entire or partial loss/cost of the action. So, as stated by others, the plaintiff is on his/her own dime.
Ins. policies typically contain one duty and one possible duty for the insurer. The duty is to "defend" an insured. The possible duty is to "indemnify," as in pay the entire or partial loss/cost of the action. So, as stated by others, the plaintiff is on his/her own dime.
BrianB (California)
Posts: 2,820
Posts: 2,820
Posted:
thanks John... that helps explain it.
I guess in some of the situations i can think of, the insurer might simply say "we suggest you seek outside counsel" to the defendant, and just not cover anyone.
I guess in some of the situations i can think of, the insurer might simply say "we suggest you seek outside counsel" to the defendant, and just not cover anyone.
JohnK3 (Pennsylvania)
Posts: 967
Posts: 967
Posted:
Brian,
The insurer has the duty to defend including associated costs. Could be with an in-house attorney, a "captive" firm, or an outside lawyer with whom it has experience. It would be rare for the insurer to allow an insured to choose counsel, though not impossible.
The insurer has the duty to defend including associated costs. Could be with an in-house attorney, a "captive" firm, or an outside lawyer with whom it has experience. It would be rare for the insurer to allow an insured to choose counsel, though not impossible.
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