trustee

A trustee is one who, having legal title to property, holds it in trust for the benefit of another and owes a fiduciary duty to that beneficiary.  See Black's Law Dictionary, Seventh Edition

In a nonprofit corporation, a director, regardless of title, may not be considered to be a trustee with respect to any property held or administered by the nonprofit corporation.  See Utah Code § 16-6a-822(5).

As to developer-appointed board members, the court in Davencourt, quoting the Restatement Third, stated, "treating the developer and its appointees to the board as trustees overstates the fiduciary component of the relationship.  Given the developer's self-interest, the developer cannot be expected to act solely in the interests for the association and the homeowners.  Conflicts of interest are inherent in the developer's role while it retains control of the association."  The court went on to state a developer is therefore not a fiduciary in the broadest sense.

But, the Nonprofit Act already clarifies that a director is not considered a trustee with respect to association property, and the association in Davencourt was in fact incorporated as a nonprofit corporation, so the need to use the Restatement for the source of this law is unclear.

In any event, the Restatement clarifies a director's position as follows:

Although directors of community associations have sometimes been likened to trustees, their position is closer to that of a director of a nonprofit association or director of a closely held corporation.  Unlike the usual private trustee, the directors in a common-interest community have an investment stake that is equivalent to that of other association members.  Any action that reduces the value of the common property or values in the community affects the director.  Directors are also unlike trustees of private trusts in that they are subject to election and removal from office in a democratic process.

Restatement Third, Property (Servitudes) § 6.14 Com. a.

Statutes and Cases:

(For reference: 57-8 is the Condo Act, 57-8a is the Community Association Act, 16-6a is the Nonprofit Act)

16-6a-822. General standards of conduct for directors and officers
Davencourt at Pilgrims Landing HOA v. Davencourt et al. (economic loss doctrine, developer duties, implied warranty of habitability) '09