RCW 24.03A.540
Liability of directors.
(1) A director of a nonprofit corporation is not liable to the nonprofit corporation for any action taken, or any failure to take any action, as a director, except as provided in subsection (2) or (3) of this section or in the articles or bylaws.
(2) Notwithstanding any provision to the contrary in the articles or bylaws, a director is liable to the corporation for:
(a) The value of any benefit in cash, other property, or services received by the director to which the director is not legally entitled; or
(b) Intentional misconduct or a knowing violation of law, including but not limited to criminal law or this chapter, by the director.
(3) A director is liable to the corporation for a violation of any additional standard of conduct specified in the nonprofit corporation's articles as an exception to the limitation on [the] director's liability.
(4) A director of a nonprofit corporation is not liable to any member of the nonprofit corporation for any action taken, or any failure to take action, as a director, except as provided in subsection (5) of this section.
(5) A director is liable to a member of the corporation only for:
(a) A knowing infliction of harm upon the member; or
(b) An intentional violation of criminal law or this chapter that results in harm or loss to the member.
(6) The party seeking to establish the director's liability to the corporation or any member of the corporation:
(a) For money damages, also has the burden of establishing that:
(i) Harm to the nonprofit corporation or its members has been suffered; and
(ii) The harm suffered was proximately caused by the director's challenged conduct; or
(b) For other money payment under a legal remedy, such as compensation for the unauthorized use of corporate assets, also has whatever burden of persuasion may be called for to establish that the payment sought is appropriate in the circumstances; or
(c) For other money payment under an equitable remedy, such as profit recovery by or disgorgement to the corporation, also has whatever burden of persuasion may be called for to establish that the equitable remedy sought is appropriate in the circumstances.
(7) Nothing contained in this section:
(a) In any instance where fairness is at issue, such as consideration of the fairness of a transaction to the nonprofit corporation under RCW 24.03A.615(1)(c), alters the burden of proving the fact or lack of fairness otherwise applicable;
(b) Alters the fact or lack of liability of a director to the nonprofit corporation under another section of this chapter, such as the provisions governing the consequences of an unlawful distribution under RCW 24.03A.610, a conflicting interest transaction under RCW 24.03A.615, or taking advantage of a business opportunity under RCW 24.03A.620;
(c) Affects any rights to which the corporation or a director or member may be entitled under another statute of this state or the United States; or
(d) Affects the authority of the attorney general to take any action against a director under this chapter or other applicable Washington state law.
[ 2021 c 176 § 2411.]
NOTES:
Effective date—2021 c 176: See note following RCW 24.03A.005.
Structure Revised Code of Washington
Title 24 - Corporations and Associations (Nonprofit)
Chapter 24.03A - Washington Nonprofit Corporation Act.
24.03A.020 - Service on corporations.
24.03A.025 - Venue for actions.
24.03A.030 - Application to existing nonprofit corporations.
24.03A.035 - Application to registered foreign nonprofit corporations.
24.03A.040 - Relationship to prior statutes.
24.03A.045 - Relationship to other laws.
24.03A.050 - Subordination to canon law.
24.03A.055 - Applicability of uniform business organizations code.
24.03A.060 - Filing requirements.
24.03A.065 - Electronic filings.
24.03A.075 - Major changes by charitable corporations.
24.03A.080 - Powers of secretary of state.
24.03A.100 - Articles of incorporation.
24.03A.105 - Effectiveness of incorporation.
24.03A.110 - Requirement of registered agent.
24.03A.115 - Liability for preincorporation transactions.
24.03A.120 - Organization of corporations.
24.03A.135 - Power to modify purposes.
24.03A.145 - Emergency powers.
24.03A.150 - Ultra vires action.
24.03A.155 - Distributions prohibited.
24.03A.160 - Reasonable compensation permitted.
24.03A.165 - Property held for charitable purposes.
24.03A.170 - Debt and security interests.
24.03A.175 - Private foundations.
24.03A.180 - Unrestricted gifts.
24.03A.185 - Restricted gifts.
24.03A.190 - Modification or release of gift restrictions.
24.03A.195 - Binding agreement to modify or release restrictions.
24.03A.200 - Judicial modification or release of restrictions.
24.03A.205 - Charitable purpose survives.
24.03A.210 - Corporate records.
24.03A.215 - Inspection by members.
24.03A.220 - Scope of member's inspection right.
24.03A.225 - Financial statements for members.
24.03A.230 - Court-ordered inspection.
24.03A.235 - Inspection by directors.
24.03A.240 - Use of membership list.
24.03A.245 - Public benefit designation.
24.03A.250 - Application and renewal.
24.03A.255 - Removal of status.
24.03A.260 - Registration to do business.
24.03A.265 - Effect of registration.
24.03A.270 - Name of foreign nonprofit corporation.
24.03A.275 - Registered agent of foreign nonprofit corporation.
24.03A.280 - Service on foreign nonprofit corporation.
24.03A.285 - Withdrawal of registration.
24.03A.290 - Withdrawal upon conversion or dissolution.
24.03A.295 - Amendment to registration upon conversion.
24.03A.300 - Transfer of registration.
24.03A.305 - Termination of registration.
24.03A.310 - Judicial review of termination.
24.03A.320 - Scope of membership.
24.03A.325 - Admission of members.
24.03A.330 - Consideration for admission.
24.03A.335 - Capital contributions.
24.03A.340 - Rights and obligations.
24.03A.345 - Differences in rights and obligations.
24.03A.350 - Transfers of membership.
24.03A.355 - Member's liability for corporate obligations.
24.03A.360 - Member's liability for dues, fees, and assessments.
24.03A.365 - Creditor's action against member.
24.03A.370 - Resignation of member.
24.03A.375 - Termination and suspension of membership.
24.03A.380 - Repurchase of memberships.
24.03A.390 - Annual and regular meetings.
24.03A.395 - Special meetings.
24.03A.400 - Court-ordered meeting.
24.03A.405 - List of members for meeting.
24.03A.410 - Notice of membership meeting.
24.03A.415 - Waiver of notice.
24.03A.425 - Conduct of meeting.
24.03A.435 - Voting entitlement of members.
24.03A.440 - Membership quorum and voting requirements.
24.03A.445 - Differing quorum and voting requirements.
24.03A.450 - Voting for directors.
24.03A.455 - Acceptance of ballots, consents, waivers, or proxies.
24.03A.460 - Inspectors of election.
24.03A.465 - Action by voting groups.
24.03A.470 - Voting agreements.
24.03A.475 - Action without meeting by unanimous written consent.
24.03A.480 - Action without meeting by ballot.
24.03A.485 - Procedure for remote meetings.
24.03A.490 - Board of directors—Authority.
24.03A.495 - Standards of conduct for directors.
24.03A.500 - Qualification of directors.
24.03A.505 - Number of directors.
24.03A.510 - Selection of directors.
24.03A.515 - Terms of directors, generally.
24.03A.520 - Staggered terms for directors.
24.03A.525 - Resignation of director.
24.03A.530 - Removal of directors.
24.03A.535 - Vacancy on board of directors.
24.03A.540 - Liability of directors.
24.03A.545 - Compensation of directors.
24.03A.550 - Meetings of the board.
24.03A.555 - Notice of board meetings.
24.03A.560 - Waiver of notice.
24.03A.565 - Board quorum and voting requirements.
24.03A.570 - Action without meeting by unanimous written consent.
24.03A.575 - Board and advisory committees.
24.03A.580 - Procedure for remote meetings.
24.03A.590 - Standards of conduct for officers.
24.03A.595 - Resignation and removal of officers.
24.03A.600 - Contract rights of officers.
24.03A.605 - Loans or guarantees.
24.03A.610 - Liability for unlawful distributions.
24.03A.615 - Conflicting interest transactions—Voidability.
24.03A.620 - Business opportunities.
24.03A.625 - Removal by judicial proceeding.
24.03A.630 - Indemnification and advance for expenses.
24.03A.635 - Directors and officers under 18 years of age.
24.03A.640 - Authority to amend.
24.03A.645 - Amendment of articles by nonmembership corporation.
24.03A.650 - Amendment before admission of members.
24.03A.655 - Amendment after admission of members.
24.03A.660 - Voting on amendments by voting groups.
24.03A.665 - Articles of amendment.
24.03A.670 - Restated articles of incorporation.
24.03A.675 - Amendment of articles pursuant to reorganization.
24.03A.685 - Effect of articles of amendment.
24.03A.690 - Power to amend bylaws.
24.03A.695 - Bylaw amendments requiring member approval.
24.03A.700 - Effect of bylaw amendment.
24.03A.705 - Approval of amendments by third parties.
24.03A.715 - Property held for charitable purposes.
24.03A.720 - Prohibition of financial benefit.
24.03A.725 - Limitations on charitable corporations.
24.03A.735 - Adoption of plan of merger.
24.03A.740 - Articles of merger.
24.03A.745 - Effect of merger.
24.03A.750 - Abandonment of merger.
24.03A.760 - Excluded transactions.
24.03A.765 - Required approvals.
24.03A.770 - Property held for charitable purposes.
24.03A.775 - Prohibition on financial benefit.
24.03A.780 - Voting rights in existing corporations.
24.03A.790 - Action on a plan of domestication.
24.03A.795 - Articles of domestication.
24.03A.800 - Effect of domestication.
24.03A.805 - Abandonment of domestication.
24.03A.810 - For-profit conversion of noncharitable corporations.
24.03A.815 - Action on a plan of for-profit conversion.
24.03A.820 - Articles of for-profit conversion.
24.03A.825 - Effect of for-profit conversion.
24.03A.830 - Abandonment of for-profit conversion.
24.03A.835 - For-profit domestication and conversion.
24.03A.840 - Articles of domestication and conversion.
24.03A.845 - Effect of for-profit domestication and conversion.
24.03A.850 - Abandonment of for-profit domestication and conversion.
24.03A.855 - Entity conversion for noncharitable corporations.
24.03A.860 - Plan of entity conversion.
24.03A.865 - Action on a plan of entity conversion.
24.03A.870 - Articles of entity conversion.
24.03A.875 - Effect of entity conversion.
24.03A.880 - Abandonment of entity conversion.
24.03A.885 - Dispositions not requiring member approval.
24.03A.890 - Dispositions requiring member approval.
24.03A.895 - Effect of dispositions.
24.03A.900 - Property held for charitable purposes.
24.03A.902 - Prohibition of financial benefit.
24.03A.904 - Authorization of voluntary dissolution.
24.03A.906 - Distribution of assets on dissolution.
24.03A.908 - Corporations holding property for charitable purposes.
24.03A.910 - Articles of dissolution.
24.03A.912 - Revocation of dissolution.
24.03A.914 - Effect of dissolution.
24.03A.916 - Prohibition of financial benefit.
24.03A.918 - Known claims against dissolved corporation.
24.03A.920 - Other claims against dissolved corporation.
24.03A.922 - Enforcement of claims.
24.03A.924 - Court proceedings.
24.03A.926 - Directors' duties.
24.03A.928 - Administrative dissolution.
24.03A.930 - Procedure and effect of administrative dissolution.
24.03A.932 - Property held for charitable purposes.
24.03A.934 - Reinstatement of administratively dissolved corporation.
24.03A.936 - Judicial dissolution.
24.03A.938 - Procedure for judicial dissolution.
24.03A.942 - Decree of dissolution.
24.03A.944 - Notice to attorney general.
24.03A.946 - Actions to secure property held for charitable purposes.
24.03A.948 - Attorney general's right to intervene.
24.03A.950 - Attorney general's investigative power.
24.03A.952 - Civil investigative demands.
24.03A.954 - Religious corporations.
24.03A.956 - Assurances of discontinuance.
24.03A.958 - Civil penalties, costs, and fees.
24.03A.960 - Charitable asset protection account.