When attorney, managers are out of line, board needs to act

Question: I’m on our board of directors, and we have a lawyer who has been advising our association for about five years. When we first hired him we made it very clear that he was “only to act when we asked him to do so.” At the time he assured us he understood, but that hasn’t happened.

Instead, he has somehow taken over our complex. He invites himself to our board meetings and then bills us for his time. He initiates calls to board members to “discuss things” and bills us for those. He insists that the “management company call him directly,” and he bills us for that too. He decides that something needs to be done and bills us for his revelations. We do not ask him for these brainstorms; he does them of his own accord.

When a board member tries to talk to him about it, he says, “It’s a liability, and I won’t be responsible for that.” By his account, everything is a liability that enables him to advise and bill us.

During our last board meeting, a director researching various topics distributed articles to all board directors for review before distribution to the owners. When he saw the director hand out the articles, the attorney jumped out of his seat and grabbed one. He read it, crumpled it up and threw it on the floor. Then he quickly began removing all the other copies. He ripped those up and threw them in the trash, saying, “That’s pure nonsense, don’t pay any attention to that.” We were dumbfounded.

He has developed a close relationship with the management company, which supports whatever he tells them. When we gave our manager the article, he said, “Our company doesn’t care what that says.”

As a board, we are not interested in the company’s opinion. We want them to respect and obey our authority as their employer. We’ve asked management not to communicate with the attorney or take any direction from him, but they brazenly continue. How do we get rid of this attorney, and how do we put our foot down with the management company?

Answer: You could fire them both. Each is a vendor selling services to the association and, as such, is subject to the control of the board.

The management company has breached its duty by not following the board’s direction. The attorney has breached his duty by overstepping his bounds and interfering with the association.

Any time the management company or attorney takes action that is contrary to the board’s direction, and then bills for those services, the association should reject the item as unauthorized and refuse to pay.

Vendors such as these will likely move on to other associations less prone to question their actions, but don’t wait for that. Having recognized the damage these vendors have caused your association, now is the time for your board to act with determination and take charge of this situation.

In this case, by usurping control from the board of directors, both the management company and the attorney have become liabilities to your association, subjecting the board to a breach of its fiduciary duties by allowing these conditions to continue uncontrolled. Avoid making excuses for why the attorney or management should stay and end these relationships.

Crumpling a piece of paper that does not belong to him might not seem so bad, but there is more to what happened here. A duly elected director spent time researching board business and brought the results of that research, those articles, to the meeting for a purpose. Those articles are considered association documents.

By taking and then destroying property consisting of “documents belonging to the association,” the attorney can be fired and invoiced for the cost of his destruction. Be certain to document the attorney’s actions in the meeting minutes and send him a bill for the costs or replacement of the documents.

As for his “nonsense” claim, the attorney has interfered with board business and its right of free speech. This is a violation of his oath to uphold the state constitution and could subject him to discipline if reported to the State Bar of California.

Whether or not he is reported, the board has a duty to act. In this case, firing both vendors is the appropriate course of action.

Questions can be sent to P.O. Box 11843, Marina del Rey, CA 90295 or e-mailed to NoExit@mindspring.com.