81.840 - Duties of managers.
81.840 Duties of managers.
1. A manager owes to the unincorporated nonprofit association and to its members the fiduciary duties of loyalty and care.
2. A manager shall manage the unincorporated nonprofit association in good faith, in a manner the manager reasonably believes to be in the best interests of the association, and with such care, including reasonable inquiry, as a prudent person would reasonably exercise in a similar position and under similar circumstances. A manager may rely in good faith upon any opinion, report, statement or other information provided by another person that the manager reasonably believes is a competent and reliable source for the information.
3. After full disclosure of all material facts, a specific act or transaction that would otherwise violate the duty of loyalty by a manager may be authorized or ratified by a majority of the members that are not interested directly or indirectly in the act or transaction.
4. A manager that makes a business judgment in good faith satisfies the duties specified in subsection 1 if the manager:
(a) Is not interested, directly or indirectly, in the subject of the business judgment and is otherwise able to exercise independent judgment;
(b) Is informed with respect to the subject of the business judgment to the extent the manager reasonably believes to be appropriate under the circumstances; and
(c) Believes that the business judgment is in the best interests of the unincorporated nonprofit association and in accordance with its purposes.
5. The governing principles in a record may limit or eliminate the liability of a manager to the unincorporated nonprofit association or its members for damages for any action taken, or for failure to take any action, as a manager, except liability for:
(a) The amount of financial benefit improperly received by a manager;
(b) An intentional infliction of harm on the association or one or more of its members;
(c) An intentional violation of criminal law;
(d) Breach of the duty of loyalty; or
(e) Improper distributions.
(Added to NRS by 2009, 697)