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Michael, Attorney
Category: Business Law
Satisfied Customers: 58
Experience:  Experienced Business Lawyer
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What is the point of law that covers the directer not treating

Customer Question

What is the point of law that covers the directer not treating all stock holders equal?
Submitted: 5 years ago.
Category: Business Law
Expert:  Ellen replied 5 years ago.

WebLaw :

*Due to rules of your state bar or mine, nothing herein is intended as legal advice, only intended as general information to better help yourself.*

WebLaw :

It appears that you may have an action based upon breach of fiduciary duty

The Board of Directors has a fiduciary duty to the owners. One of those duties is to enforce all the rules and restrictions fairly and nondiscriminatorily and to act in the best interest of all community members.

You may consider writing the board a letter, rrr stating that they are in violation of their fiduciary duties and are acting outside the scope of their authority. If they do not correct their actions, you may have to file suit.


I was aware of fiduciary duty but there is another point of law that explicitly addresses this action but I haven't found that law yet.

WebLaw :

I do not know what you are referring to.

WebLaw :

I will opt out – perhaps another expert can assist you


I remember reading it in the definition section but a can't remember where.

Expert:  Michael replied 5 years ago.
Breach of fiduciary duty would probably be your best claim, if the individual was actually a director of the entity behind the HOA. The director has a fiduciary duty to the association and its members. If he were to purposefully and substantially act against the interests of the association, he would be in breach of that legal duty.

That said, such a breach would have to be quite pronounced (think double-dealing, nepotism, etc.). A fiduciary's poor judgment, within reason, does not qualify. Many actions would fall within a "gray area" that, while poorly reasoned, are not legally actionable. Your case might be in that area. You would probably have to establish a pattern, or something that demonstrates the director was actively working against the interests of the association, rather than simply made an incorrect decision.

Outside of any legal recourse, you could of course just get the word out in your HOA for campaign for his removal and replacement (being reasonable and factual while doing so).
Michael, Attorney
Category: Business Law
Satisfied Customers: 58
Experience: Experienced Business Lawyer
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