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Three Big Things Attorneys Wish Boards Knew

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Whether you serve on the board of a co-op, condo or HOA, chances are you and your fellow community administrators are volunteers. Perhaps you’re fortunate enough that you or one of your colleagues has professional legal expertise to bring to the table – but even if that’s the case, sooner or later you’ll need to consult with outside legal counsel on some issue, whether it be the sale of an apartment in the building, or an acrimonious situation between neighbors, or between a resident and the board itself.

When the day comes, it pays to keep a few things in mind before picking up the phone (and starting the billable hours’ clock) to call you building’s attorney. We polled some co-op, condo, and HOA lawyers across the country to find out the top half-dozen things they wish boards knew, before lawyering up.

Know When to Call

Most boards prioritize fiscal responsibility above nearly everything; which is why important decisions that necessitate professional consultations can be put off – which can ultimately cost an association more.

“Use your professional resources,” advises Ryan D. Poliakoff, a partner with the Boca Raton, Florida-based law firm Becker & Poliakoff. As senior counsel, Poliakoff, most often finds that boards fear using the association’s attorney services for a variety of reasons. Besides budget concerns, a board may not realize when it’s time to call for professional consultation. Poliakoff points out the importance of calling upon the right resource for the need at hand, whether it be a property manager, bookkeeper or an attorney. “An elected board creates and defines policy but these professionals have specific knowledge on liability and risk for complex issues,” he says.

Change it Up

Maintaining ‘institutional memory’ – the cumulative administrative expertise that carries over from one group of leaders to their successors – is very helpful when it comes to community governance. But boards can find themselves stuck in a rut if they insist on following previous members’ footsteps too closely. Don’t get caught in the trap of picking up old members’ bad habits. If something is broken, fix it, says attorney Sima L. Kirsch, founder of the law firm of Sima L. Kirsch, PC in Chicago.“Just because the previous board did it does not mean it is correct,” Kirsch says. “When a transition occurs, the new board cannot escape its fiduciary duty by merely saying, ‘Well, that’s the way we’ve always done it.’ A transition review of the state of the corporation and its operational systems is an exercise in best practices.”

Value Transparency

“If I had a nickel for every meeting I went to and heard complaints about transparency and communication, I’d have a lot of nickels,” says Adam Finkelstein, a partner with the Manhattan-based law firm of Kagan Lubic Lepper Finkelstein & Gold, LLP in New York City. “It’s probably the number-one thing you can bet on hearing in a meeting.”


Association Specialty Group provides association management services across South Florida. Read more condominium and homeowners’ association tips on their Florida HOA Blog. 

 

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