Code of the District of Columbia

§ 29–1119. Duties of manager.

(a) A manager shall owe to the unincorporated nonprofit association and to its members the fiduciary duties of loyalty and care.

(b) 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.

(c) 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.

(d) A manager that makes a business judgment in good faith satisfies the duties specified in subsection (a) of this section if the manager:

(1) Is not interested, directly or indirectly, in the subject of the business judgment and is otherwise able to exercise independent judgment;

(2) 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

(3) Believes that the business judgment is in the best interests of the unincorporated nonprofit association and in accordance with its purposes.

(e) 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:

(1) The amount of financial benefit improperly received by a manager;

(2) An intentional infliction of harm on the association or one or more of its members;

(3) An intentional violation of criminal law;

(4) Breach of the duty of loyalty; or

(5) Improper distributions.


(July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720.)

Section References

This section is referenced in § 29-1123.

Editor's Notes

Uniform Law: This section is based on § 23 of the Uniform Unincorporated Nonprofit Association Act (2008 Act).