In Brown v. Hensley, a condominium complex was damaged by a hurricane, and the board of the complex allowed the complex to be demolished. No. 14-14-00981-CV, 2017 Tex. App. LEXIS 727 (Tex. App.—Houston [14th Dist.] January 26, 2017, no pet. history). Some of the unit owners sued the board for breach of fiduciary duty and other claims arising from this decision. The trial court granted the board members’ motion for summary judgment.
The court of appeals affirmed this dismissal based on the Texas Charitable Immunity and Liability Act, which limits the liability of charitable organizations and immunizes volunteers who meet certain conditions. Id. (citing Tex. Civ. Prac. & Rem. Code §§ 84.001). Under the Act, and subject to exceptions, “a volunteer of a charitable organization is immune from civil liability for any act or omission resulting in death, damage, or injury, if the volunteer was acting in the course and scope of the volunteer’s duties or functions, including as an officer, director, or trustee within the organization.” Tex. Civ. Prac. & Rem. Code § 84.004(a). The Act defines “charitable organization” to include a homeowners association. Tex. Civ. Prac. & Rem. Code § 84.003(1)(C). Additionally, the Act defines “volunteer” to mean “a person rendering service for or on behalf of a charitable organization who does not receive compensation in excess of reimbursement for expenses incurred.” Tex. Civ. Prac. & Rem. Code § 84.003(2). The term includes a person serving as a director. Id.
The plaintiffs asserted that the board members were liable in their individual capacities under Section 84.007(b). This subsection provides the Act “does not limit or modify the duties or liabilities of a member of the board of directions or an officer to the organization or its members and shareholders.” Tex. Civ. Prac. & Rem. Code § 84.007(b). This subsection addresses liabilities of directors “to the organization or its members and shareholders.” The court held that the board members’ liability to the condo association was not at issue as the plaintiffs did not bring a derivative action on behalf of the association or as a class action on behalf of all unit owners. Therefore, the court affirmed the summary judgment.