Click History for a list of changes and updates.
__Maybe a more appropriate title is "Should any attorney for MOA be believed?" Or, what actions should a board take to ensure that any opinion of an attorney is likely to be valid under the law and governing documents?
__Part of the broader question is "Who does the attorney represent?" or "Who is the client?"
__The continuation of this post discusses these questions in the context of Article IX of the bylaws for which MOA has conflicting opinions from two different attorneys on whether or not the board of directors has the authority to amend the bylaws.
Don Nordeen
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Click Continue for Post Continuation plus Comments.
- Key Words:_ • Attorney Issues, • Community Association • Governing Documents (General), •Members' Rights, • Michaywé Owners Association, attorney, board of directors, engagement letter, governing documents, lawyer, organization as client, property owners association, transparency
Which attorney should be believed? (continued)
Introduction
__One of the important resources for an owners association is the attorney who provides legal analysis and opinion regarding actions under consideration and actions that may already have been taken. Members expect that any analysis and/or opinion will be based solidly on the law and governing documents and would have a high likelihood of being supported if contested in court.
__While the above may be a laudable objective, there are no guarantees that the legal analysis and opinions, which are based on the instructions and information provided by the association's agent(s), will be consistent with that objective. The reasons are many.
__One should note that in a civil court proceeding, one attorney argues one point of view and the other attorney argues another. Both represent that they are advocating the law and all its applications. The court's ruling decides. The arguments by one of the attorneys were wrong.
MOA's Experience with Article IX of the Bylaws
__MOA has first-hand experience with differing legal opinions. With regard to Article IX of the bylaws, Mr. William M. Davison opined in 2001 that he believed the board had the authority to amend MOA's bylaws. On the basis of Mr. Davison's opinion and perhaps other considerations, MOA's board in 2001 rescinded Article IX. Mr. Davison's letter was attached to the 2001 Nov 17 board minutes so has been made available to MOA members.
__This writer protested the action of the board and questioned the correctness of the legal opinion by Mr. Davison. Even though Mr. Davison was advised that he did not consider a section of the applicable law and that other interpretations could be made, Mr. Davison defended his prior opinion and offered new arguments.
__Another legal opinion was obtained from a different attorney, Ms. Laura M. Dinon, engaged by the board as MOA's attorney in 2007. She opined that the action of the board in 2001 was not valid meaning that the board did not have the authority to amend the bylaws. The board has refused to release this legal opinion so it is not possible to examine the quality of the analysis.
__So, which attorney is correct? How should the matter be resolved for MOA?
Conflicting Opinions are Inherent
__The attorney's interest is to satisfy the client — to provide what the client wants. While, under the law, MOA is the client, the reality is that the board selects and engages the attorney and pays the attorney's fees. Unless the board understands that the Association is the client and puts the Association and the common interests of its members first, and that the attorney's analysis and opinions should be based on the interests of the Association which includes the common interests of its members, the reality is that the interests of the agent and the board will be served.
__The interests of the agent and the board are reflected in the instructions provided to the attorney. Consider the following two scenarios:
- Suppose the instructions to the attorney are that the board has decided that it wants to take a particular action, and requests the strongest legal opinion in support of that action.
- Suppose that the board has interest in a particular action and requests a legal opinion related to that action, but with a standard that the board wants to ensure that the action would likely prevail in court as within the scope of authority of the Association and the board. The board further provides the relevant facts and documents.
__The first step is for the boards to understand that MOA is the client and that the attorney's analysis and opinions should be based on the interests of MOA and the common interests of its members.
__The next step is to understand that the opinions provided by attorneys depend upon the instructions (facts, documents, standards, etc.) provided by the agent of the Association. The board may function collective as the agent, but someone should be designated as the agent for the contacts with the attorney. All of these issues should be approved by the board by motions.
__The above considerations can all be placed into a letter of engagement. The content for such a letter should be approved by the board, or better approved by the members as part of the bylaws. This would provide stability and predictability for MOA members. An ongoing step is oversight. This mostly has to be done by the board by approval of the instructions for each request of the attorney. Then by ensuring that the attorney repeats the instructions in the analysis and opinion and that the instructions are correct. With a repeat of the instructions, the attorney's opinion is just a game of Jeopardy. The opinion is an answer to some question, but what question? The attorney's opinion should not be blindly followed. Does the opinion make sense. Is it fair to the common interests of MOA's members? Is it arbitrary and capricious? These questions are all part of reasonable inquiry.
Another ongoing step is constant improvement. Each request and each opinion provides a learning opportunity. Methods in organizations are never constant. They either get better or they degrade.
Attorney Opinions for MOA
__During the time period from mid-year 2000 through mid-year 2005, the minutes of the board meetings indicate that very little of the above considerations would placed into practice. When the correctness of the opinions was questioned, it is natural for the attorneys to defend their prior opinions. Just human nature. Moreover, it is difficult for subsequent boards to understand the prior opinions if the instructions were not approved by the board or otherwise document in MOA's records. The opinions are likely based on the instructions — most of which are unknown to the boards.
Your Comments and Thoughts
__Please add your comments and thoughts. Will the situation get any better without intervention by a group of members?
- History: _
- 2008 Jul 28 — Initial Post
- Links:_ Which attorney should be believed? [http://swagmanmwpoa.blogspot.com/2008/07/which-attorney-should-be-believed.html]
•••End of Post•••
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