The homeowners association manager is not a board director and is not the client. And unlike the board, the manager has conflicting interests and allegiances.
November 24, 2013 By Donie Vanitzian, JD
Question: I have been on my homeowners association board for two years. All communication between the board and the attorney goes through the association’s manager before distribution to the board. I just discovered the manager has been withholding communications the attorney has written to the board. I’ve also found instances where the manager regularly emails the association attorney stating, “The board wants” and “The board would like you to,” when in fact the board never discussed such matters.
While attempting to communicate this situation to the attorney by email, which I assumed was confidential and protected by attorney-client privilege, his response was instead indiscriminately forwarded to the manager by one of the attorneys in the law firm. At the following board meeting, the manager stated the association’s attorney “recommended” the board pass a resolution that no board director contact the attorney for any reason whatsoever, which the president and majority of the board then passed. This effectively cuts off all directors from any attorney advice to run the association properly.
I am concerned that because all of our legal matters are communicated via a third party, we have lost our attorney-client privilege and we are out of the loop. Does the attorney have an ethical responsibility to ensure that communication gets to all directors in a timely manner and is not censored by a third-party vendor?
Answer: The quick answer is yes, but not exactly. The basic rule is that when an attorney represents the board, the fiduciary duty is owed toward every board director, and the board as a whole has the ultimate say on all issues. But the board is a group, and whenever a lawyer represents a group of people — any group (the board being just one example) — the attorney has the right to ask that all communications go through designated directors. Otherwise, the lawyer could be receiving continual and conflicting communications.
Boards should be mindful of the possibility of manager interference with board duties. The manager is not a board director and is not the client. Nor can the manager take on the role of legal liaison between the board and its attorney because, unlike the board, the manager has conflicting interests and allegiances. The fact that the manager undoubtedly works for more than one association may give rise to conflicts.
More important, while the manager may recommend incurring additional legal charges, he or she does not have to pay any part of the association’s legal fees. That could lead the manager to give the attorneys more leeway in deciding what matters to pursue than is healthy for the association.
For these reasons, the manager cannot become the go-between for the lawyers and the board. Instead, the board might consider appointing a homeowner — it could be one person or a small committee — to interface with the attorneys, and the attorneys must then be instructed to communicate through those designated directors or committee appointees.
The attorneys have an ethical responsibility to ensure that their communications get to the board in an unadulterated manner. As for the manager, it is unethical for him or her to tamper with the board’s mail and communications, no matter who the sender is.
With regard to your phone call to the attorney: You were calling as a board director regarding association business. While you may have had no right per se to expect your communication to be kept secret from other directors, you certainly had the right to expect your communication to be kept confidential from the manager, who is a third-party vendor. It appears the attorney has ignored that fact in a rather vulgar way.
There is an ever-present danger in homeowners associations that the board, whose members usually come and go with election cycles, may become subservient to the “hired help,” that is, to the managers and law firms whose tenure tends to be longer. This can lead to abuses of the titleholders, who are required to pay the fees of the hired help. Even though board directors are titleholders themselves, many often prefer to avoid the hard work and difficult decisions, preferring not to rock the boat even when a third-party vendor like the manager is at the helm.