Title 10 - Corporations and Associations

Chapter 29, Members and Membership - Nonprofit Corporations, Sec. 10-3601-10-3640

Creditor’s action against member

Article 2, Types of Memberships-Members' Rights and Obligations, § 10-3614

Source: Arizona Revised Statutes

  1. No creditor of the corporation may bring a proceeding to reach the liability of a member to the corporation unless final judgment has been rendered in favor of the creditor against the corporation, and execution has been returned unsatisfied in whole or in part.
  2. All creditors of the corporation, with or without reducing their claims to judgment, may intervene in any creditor’s proceeding brought under subsection A to reach and apply unpaid amounts due the corporation. Any or all members who owe amounts to the corporation may be joined in that proceeding.
  3. In any proceeding by a creditor under this section, the member shall pay any amount that is determined to be owed by the member to the corporation directly to the corporation and not to any creditor. The member is not liable directly or indirectly for any costs incurred by the creditor in the proceeding. If the member has paid the amount to the corporation, the liability of the member to the corporation for that amount is fully satisfied, the member is no longer a party to the proceeding and is immune from further proceedings under this section for the amount.

Also in: Chapter 29, Sec. 10-3601-10-3640

View all Nonprofit Corporation Act statutes.

Source: This content is sourced from the online version of the Arizona Revised Statutes located at www.azleg.gov.

Disclaimer: These statutes are provided as a courtesy by CHDB Law LLP. CHDB Law cannot guarantee that the statutes set forth on the website or in our published guide will not be found to be defective by a court or other tribunal after the date the books or online material are published. The HOA Knowledge Base does not attempt to include every statute that could apply to a community association issue. There may be other statutes or applicable laws that have a bearing on a particular legal issue confronted by a community association. These statutes are provided as a reference only. If a particular legal issue is confronted by a community association, the association should seek legal advice from competent attorneys.

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