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LAWYERS ON BOARDS
QUESTION: Is there a conflict of interest when one board
member is a practicing attorney & makes pronouncements on all issues that come
before the board? He often twists the law to suit his own personal wishes, and
intimidates the other two members who are not lawyers.
ANSWER:
There is no conflict of interest unless the lawyer or his firm has been hired by
the association.
Good Lawyers. A lawyer on the board can be
a valuable asset to an association. Legal training brings unique analytical
skills to problems faced by boards and a good lawyer can be invaluable at
spotting potential liability issues.
Problem Lawyers. Where lawyers get themselves and everyone else
into trouble is when they freely offer legal advice.
The
problem is that they often have no experience with community association law. They mean well but but their advice
is sometimes dead wrong. Associations should hire good corporate counsel and
follow their advice. Seasoned lawyers on boards will defer to corporate counsel.
Nightmare Lawyers. The nightmare lawyers are the ones with the giant
egos--the bullies. They constantly remind everyone that they are the smartest
person in the room (or so they think), and they regularly threaten and intimidate fellow
directors to get their way. They are an embarrassment to the profession. The membership
should replace them as quickly as possible--either through a recall petition or
by electing someone else to the seat at
the next annual meeting.
REPEAT VIOLATIONS vs.
CONTINUING VIOLATIONS
 I
received a number of inquiries about last week's article on automatic fines. I
wrote that each violation requires a hearing before fines can be levied. They
wanted to know if there is a distinction between repeat violations and continuing violations.
There is.
Repeat Violations. An example of a repeat
violation is where an owner violates a rule by letting his dog off the leash.
The board holds a hearing and fines him. The next month the owner's dog is off the leash again.
That requires another hearing and another fine. The following month he does it
again--a third hearing and another fine. The rules may allow for escalating
fines, $50, $75, $100, but each incident requires a notice, a hearing,
presentation of evidence, and a written decision.
Continuing Violations. A continuing
violation is a single violation that persists. For example, If an association
limits owners to one dog of no more than 25 pounds (typical for dense condominium developments with
elevators) and an owner moves in with a 200-pound Mastiff (scary for people in narrow
hallways and tight elevators), the
board may impose a daily fine against the owner until such time as the dog is removed from the property.
The board holds one hearing and imposes a continuing fine for the continuing
violation.
Carrot and Stick. I like the carrot and
stick approach when using daily fines. The goal is to eliminate the violation
not to make money. Once the fine is levied, the board should simultaneously offer to waive the
fine if the owner complies within 30 days (or some other reasonable time period
set by the board). Offering to waive the fine encourages
compliance and eliminates trips to court. We include a provision for daily
fines in our documents and I recommend that boards update their documents to
allow for such fines.
BANKS AND SPECIAL ASSESSMENTS
QUESTION: We have two foreclosed units in our
complex. If a special assessment becomes necessary can we require the banks to
pay their share of the assessment in addition to the monthly HOA dues?
ANSWER: If the special assessment is imposed after
the bank foreclosed and took
ownership, the bank is responsible for paying its portion of the
assessment. The same may be true if an assessment is imposed prior to a
bank's foreclosure but payments are not due until after the transfer of
ownership. You should ask your association's legal counsel for an opinion
regarding your particular assessment.
Very truly yours,
Adrian Adams, Esq.
Adams
Kessler PLC
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