Legal invoices
Adams Stirling PLC


There is some disagreement as to whether owners have a right to inspect individual invoices from the association's attorney. Some rightly argue that legal invoices contain privileged and confidential information which is not subject to disclosure to the membership. As the court in the Laguna Sur case noted:
It is no secret that crowds cannot keep them [secrets]. Unlike directors, the residents owed no fiduciary duties to one another and may have been willing to waive or breach the attorney-client privilege for reasons unrelated to the best interests of the association. . . . "[o]ne can only imagine the sleepless nights an attorney and the Board of Directors may incur if privileged information is placed in the hands of hundreds of homeowners who may not all have the same goals in mind." (Smith v. Laguna Sur).
Redacted. Others argue that boards can produce the invoices provided they redact all privileged and confidential information in the documents.

Legal Expenses. If invoices are not produced, members still have a right to know how much money is being spent on legal matters. Legal expenses should be budgeted and disclosed in monthly financial statements and made available to members upon demand.

Recommendation: Boards of Directors should consult legal counsel on if, when and how legal invoices may or may not be produced pursuant to a member's request for such records.

ASSISTANCE: Associations needing legal assistance can contact us. To stay current with issues affecting community associations, subscribe to the Davis-Stirling Newsletter.

Adams Stirling PLC