MEDICAL ~ SURGICAL COSMETIC ~ LASER Dr. Nancy H. Kim Award winning Board Certified Dermatologist Fellowship Trained MOHS Surgeon From skin cancer surgeries to anti-aging treatments, Spectrum Dermatology is recognized as one of Arizona’s leading treatment centers for laser, cosmetic, surgical and medical dermatology. INSPIRING PATIENTS TO CARE FOR THEIR SKIN CALL TODAY: 480.948.8400 www.SpectrumDermatology.com SCOTTSDALE 7425 E. Shea Blvd Suite 110 Scottsdale, AZ 85260 DESERT RIDGE 20950 N. Tatum Blvd., Suite 250 Phoenix, AZ 85050 PHOENIX/ARCADIA 4350 E. Camelback Rd. Suite A-200 Phoenix, AZ 85018 VISIT OUR ARCADIA LOCATION Page 6 December 2015 Personal liability for nonprofit board members By Matthew H. Mason If you serve on a school, church or other nonprofit board, a recent federal court case should grab your attention. The U.S. Court of Appeals ruled that officers and board members of a nonprofit were personally liable for $2,250,000 of a nonprofit’s debt. The nonprofit featured in the case was a retirement home that served the community for over 100 years. Despite its long service, by 2003, the facility was cited for numerous deficiencies and its liabilities exceeded assets by $1.9 million. In 2004, two residents died under circumstances suggesting neglect. The administrator went on part-time status, but continued to receive full-time compensation. Board members quit attending meetings, and decided to stop accepting new residents. In January 2005, the board voted to close the facility and filed for bankruptcy. Creditors sued the directors and officers for breach of fiduciary duty, breach of loyalty, breach of duty of care, and causing deepening insolvency. The Court of Appeals affirmed a $2,250,000 liability verdict against the officers and directors, and an additional $1,750,000 in punitive damages against the officers. The court’s opinion suggests that the errors of the directors and officers were prolonged and egregious. The directors’ personal liability and punitive damages against the officers were awarded because they breached important duties and caused deepening insolvency. What could the officers and directors have done to protect themselves? Breach of fiduciary duty – The board members failed to put the interests of the nonprofit before all other interests. For example, board members and officers should not vote on their own compensation. Breach of duty of loyalty – The board failed to conduct regular meetings, failed to appoint a treasurer and failed to supervise the nonprofit’s fi nances. A board must conduct meetings and keep minutes documenting its decisions, or its members could become liable for acting outside of their corporate authority. Breach of duty of care – Officers and directors should exercise the same standard of care as similarly situated business people in reliance upon experts and good business judgment. (They are not personally liable for a poor outcome or liability arising from decisions based on good business judgment.) Board members must evaluate critical staff as frequently as would a prudent business person in the same or similar circumstance. Cause deepening insolvency – The tort of deepening insolvency is not common to every state. This claim allows a nonprofit’s creditors to hold the board liable for insolvency. The board has an obligation to preserve a nonprofit’s assets and maximize returns. If a board ignores its obligation and allows the assets to deteriorate, then the nonprofit’s creditors may be successful in holding the board personally liable. If you serve on a board, some questions to ask include: Does your board hold regular meetings and keep minutes? Does your board use professional advisors? Does your board regularly evaluate key personnel and staff? Does your board monitor operations and regularly review financial and operating reports? If you answered yes to these questions, you are in good shape. Otherwise, you should consider seeking legal advice. — Matthew H. Mason is an associate attorney with Gallagher & Kennedy. LEGAL EASE

2015 Tavan School District Sales Results (1/1/2015-10/31/2015) Active Homes - 77 Homes Homes Sold - 182 Homes Average Sale Price - $479,000 Average Sold $ Per SF - $225 Average Days On Market - 111 days There is currently 5 months of home inventory. (based on 2014 sales results) 2015 home sales have increased 1% this year. (based on 2014 sales results) Home prices have increased 6% this year. (based on 2014 sales results) $ Per Square Foot prices have increased 8% this year. (based on 2014 sales results) Homes are taking 30% more time to this year. (based on 2014 sales results) 2014 Tavan School District Year End Sales Results Homes Sold - 199 Homes Average Sale Price - $451,117 Average Sold $ Per SF - $208 Average Days On Market - 78 Days 2013 Tavan School District Year End Sales Results Homes Sold - 217 Homes Average Sale Price - $403,875 Average Sold $ Per SF - $189 Average Days On Market - 66 Days 2012 Tavan School District Year End Sales Results Homes Sold - 207 Homes Average Sale Price - $326,316 Average Sold $ Per SF - $158 Average Days On Market - 66 Days 2011 Tavan School District Year End Sales Results Homes Sold - 203 Homes Average Sale Price - $265,505 Average Sold $ Per SF - $128 Average Days On Market - 102 Days Arcadia Real Estate Stats 2015 Hopi School District Sales Results (1/1/2015-10/31/2015) Active Homes - 152 homes Homes Sold - 258 homes Average Sale Price - $968,000 Average Sold $ Per SF - $298 Average Days On Market - 107 days There is currently 8 months of home inventory. (based on 2014 sales results) 2015 home sales have increased 27% this year. (based on 2014 sales results) Home prices have increased 4% this year. (based on 2014 sales results) $ Per Square Foot prices have increased 4% this year. (based on 2014 sales results) Homes are taking equal time to sell this year. (based on 2014 sales results) 2014 Hopi School District Year End Sales Results Homes Sold - 225 Homes Average Sale Price - $1,006,381 Average Sold $ Per SF - $286 Average Days On Market - 119 Days 2013 Hopi School District Year End Sales Results Homes Sold - 305 Homes Average Sale Price - $854,430 Average Sold $ Per SF - $262 Average Days On Market - 88 Days 2012 Hopi School District Year End Sales Results Homes Sold - 282 Homes Average Sale Price - $777,607 Average Sold $ Per SF - $235 Average Days On Market - 102 Days 2011 Hopi School District Year End Sales Results Homes Sold - 238 Homes Average Sale Price - $635,344 Average Sold $ Per SF - $197 Average Days On Market - 124 Days If you are buying or selling a home in Arcadia, call Tommy! visit Tommy Atkinson .com Free MLS Access • Complete list of ALL Hopi properties for sale Complete List of ALL Tavan properties for sale • Complete list of ALL Arcadia foreclosures West USA Realty Cell: 602-625-6020 tomatkinson1@msn.com 6421 E Calle Rosa • $1,350,000 5 bedroom / 4 bath • 3,460 square feet Quintessential Arcadia 3801 N 50th Street • $ 405,000 3 bed/ 2 bath • 1,831 square feet Great Arcadia Ranch 3132 N Coolidge • $639,000 4 bedroom / 4 bath • 2,820 square feet Great Camelback Corridor 5301 E Osborn • $ 1,385,000 4 Bedroom/ 5 bath • 6,900 square feet Enchanting Arcadia Estate 6680 E Calle Redondo • $2,500/rent 3 Bedroom / 2 bath • 1,991 square feet Arcadia Rental Thinking Of Selling Your Home? Call Today About My Flexible Commission Program Geared To Save You Money!