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GAYLE A. KERN, LTD. SARAH V. CARRASCO, ESQ. June 30, 2009 Dear Members of Summit Village: The Board of Directors requested that I write you regarding important action that was taken today. Effective at 11:59 p.m. on June 30, 2009, the remaining members of the Board of Directors have resigned. This was necessary because despite numerous efforts and countless hours, the Board has been unable to secure insurance to indemnify the officers and executive board and will be unable to maintain the directors’ and officer’s liability insurance. Accordingly, effective at midnight, June 30, 2009, Summit Village will have no insurance for directors’ and officer’s liability. There is still insurance for general comprehensive liability. The Association has been advised by the various insurance companies that have been contacted that the reason the Association has been unable to maintain such insurance is because of the effects of the litigation entitled, “Hilltop Duplexes Homeowners’ Association, Inc. et al, v. Summit Village, Inc.” Ninth Judicial District Court Case No. As you know, the Hilltop Duplex Homeowners’ Association sued Summit Village and obtained a judgment that the Association was liable for replacing the wooden parking deck. Many of you will have noticed that the wooden parking deck is being replaced now. The court held: “[Summit Village] was and is required to maintain and repair the parking deck... Its failure to maintain the deck and maintain adequate reserves to fix the deck is a violation of NRS Chapter 116. However, this failure was unintentional as there was a legitimate dispute about who should repair the deck. Summit Village is hereby enjoined from further breaches of NRS 116.” Based on this holding, the insurance companies will not offer any insurance to the Association because of the potential claims by other homeowner’s who may claim the same replacement and maintenance to elements that had previously been maintained by the homeowner. Accordingly, the Board members’ resignations, effective at 11:55 p.m. on June 30, 2009, necessitated taking action to ensure the continued functioning of the Board until the Annual meeting and election on July 18, 2009. In the event insurance is not obtained on or before July 18, 2009, an action will be filed to have a receiver appointed. This is a critical situation and all homeowner’s are requested to attend the annual meeting on July 18, 2009. The Board regrets such action had to be taken, but there was no alternative in light of the effects of the actions taken by Hilltop Duplexes Homeowners’ Association. Very truly yours, GAYLE A. KERN, LTD. Gayle A. Kern |
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