By Donie Vanitzian, JD
Question: I was on the board when the association’s attorney commented, “This year’s been slow at the office,” then pushed a big project for himself. He wrote “easement agreements” we never asked for and didn’t want. After nearly a year pushing his project of nonsensical easement agreements affecting over 160 homes, he finally conned a very impressionable, weak-kneed board president into agreement. Directors are not lawyers. We don’t understand this stuff. We didn’t know what he was doing; we just sat there and said, “Well, OK, if you say so since you’re the attorney.” He got us into a lawsuit and with that, he made homes that had always been attached “detached,” changing how we live forever.
We got another lawyer to review the project, but it was too late. He explained that the attorney unilaterally re-characterized the description and the distinguishing features of the affected properties, contrary to their existing deed descriptions, title reports, and the covenants, conditions and restrictions. He also took away deeded parking spaces that were part of those property purchases.
To pull this off, he had everything, even the deeds and governing documents, sent back to his office, controlling every aspect of what was happening, even bypassing a vote by the owners. We were in the dark until it was over. We want things back as they were. What can we do now?
Answer: Returning things back as they were may be costly but not impossible. Much of this could have been avoided had the board taken precautionary measures early on. A responsible board consults with experts, such as attorneys, but expert advice should never replace individual directors’ judgment and common sense. It is the board’s duty to oversee the association and look out for the best interests of the titleholders. That duty is nondelegable.
The association’s attorney can only do work that is authorized by the board. Even though this attorney kept the directors in the dark about what was going on, it sounds like the project was authorized, at least in some form. If the directors do not understand the advice of their expert, then they should not move forward without more information. It appears obvious there was no emergency related to this project, so there was no reason for the board to put so much faith in counsel when it was clearly lacking necessary information.
If you want things back as they were, and proper procedures weren’t followed, then you need to take corrective action. Retain another attorney to thoroughly review all the title transactions in hopes of avoiding individual lawsuits against the board. Then have the attorney recommend how to proceed to have the improper result overturned. If the work was particularly egregious and the association’s attorney did not assist in remedying the situation, have the new attorney initiate a fee dispute or arbitration before the State Bar Assn.
Given the opportunity, most attorneys will work with you to avoid a fee dispute or claim of malpractice. Even a reduced rate on the work to revert this project would be helpful to the board that failed in its duty to oversee the project originally.
Zachary Levine, a partner at Wolk & Levine, a business and intellectual property law firm, co-wrote this column. Vanitzian is an arbitrator and mediator. Send questions to Donie Vanitzian, JD, P.O. Box 10490, Marina del Rey, CA 90295 or firstname.lastname@example.org.