Liability of Nonprofit Associations

Corporations Code Title 3, Part 2, Chapter 1 deals with liability of nonprofit associations in California.

Section 18605 prohibits a member, director, or agent of a nonprofit association from being held liable for a debt, obligation, or liability of the association solely by reason of being a member, director, officer, or agent.

Section 18610 prohibits liability from being imposed upon a member of a nonprofit association for a contractual obligation of the association unless one of the five specified conditions is satisfied.

Section 18615 prohibits liability from being imposed upon a director, officer, or agent of a nonprofit association for a contractual obligation of the association unless one of the three specified conditions is satisfied.

Section 18620 provides that a member, director, officer, or agent of a nonprofit association is liable for injury, damage, or harm caused by an act or omission of the association or an act or omission of a director, officer, or agent of the association, if any of the three specifie conditions are satisfied. This section provides a nonexclusive list of existing grounds for liability, and does not foreclose any common law grounds for liability.

Section 18630 provides that a member or person in control of a nonprofit association may be subject to liability for a debt, obligation, or liability of the association under common law principles governing alter ego liability of shareholders of a corporation, taking into account the differences between a nonprofit association and a corporation.

Section 18640 specifies that nothing in this chapter limits application of the Uniform Voidable Transactions Act.