As was conceded on the video tape record of the Somersett Owners Association (SOA) Candidate Night meeting on October 23, 2012, candidates that are equity members of the Somersett Golf Country Club (SGCC) have a conflict of interest as they benefit financially from contracts and/or leases that call for payments from the SOA to SGCC as equity members are part owners of the SGCC.
This does not mean that they cannot run for the Board. Rather, under Nevada law, it means that: 1) this conflict should have been disclosed on the candidate statement that the SGCC equity member candidates submitted to the SOA – None did so; and 2) if elected, they must recuse themselves from voting on any contracts and/or leases that call for payments from the SOA to SGCC – It is not at all clear that they will all do so.
SU maintains that all SGCC equity member candidates should immediately revise their candidate statements to include the proper disclosure, Also, in the additional spaces provided on that form to explain how they will comply with Nevada law in the face of such a conflict of interest, they should indicate affirmatively their commitment to recuse themselves from voting on any contracts and/or leases that call for payments from the SOA to SGCC.
Attached are copies of 1) NRS 116.3103 defining “fiduciary duty” as it applies to directors & officers of non-profit boards, 2) NRS 116.31084, which addresses Board member disclosures and voting abstentions, and 3) NAC (Nevada Administrative Code) 116.405 paragraph 2, which indicates that acting for reasons of self-interest or gain is not in compliance with a fiduciary’s duty under NRS 116.3103. Please read them via the following link and decide for yourself.