June 11, 2021
Before Jaime Harrison ran for U.S. Senate or became chair of the Democratic National Committee, he was a director on the board of a condominium in Alexandria, Virginia while I was an owner-occupant. We had annual elections for board positions. Sometimes there was an election, other times we left without voting because there was not quorum. Attorney Jaime Harrison owned a unit in the same condominium. I remember him speaking before the assembled unit owners, explaining that he would make a good director, because the community manager could speak with him about legal matters before the association had to consult with a paid community association lawyer. Jaime Harrison is an intelligent, well-educated, successful guy with an impressive resume. But at the time he was on the condo board at my old building, he was working full time on capitol hill, not in a law firm that dealt with corporate, real estate, or litigation matters. I wondered why Mr. Harrison would want to position himself such that people would expect to provide free legal insights, while he had to also focus on the demands of a day job. This blog post is about what happens when attorneys sit on HOA boards or committees. Every lawyer must study contracts, property, ethics, and so on for law school and the bar exam. Few law students think about HOAs before donning their graduation caps and robes. Perhaps he worked hard, staying up late at night with the Virginia Condominium Act and case law. Jaime Harrison is not the only non-property attorney or J.D. to “moonlight” as a HOA or condominium director or committee member. Quite a few attorneys (or other licensed professionals such as contractors, trades, surveyors, realtors, etc.) sit on HOA boards or committees. You see a lot more real estate people, attorneys and retired officers than social workers, clergy, or kindergarten teachers. What motivates attorneys to do this? It’s a chance to get involved, serve in the community, meet new people, and learn practical things. When I owned that condominium unit, I spoke with a more experienced business attorney who told me that I should avoid becoming the president of a community association. My subscribed readers know that the business of HOAs is usually necessary for keeping the member’s lots or units in useable condition, but is often a legally messy affair. This is particularly true in condominium buildings where strangers share the same facilities in close proximity. Many attorneys try to be careful not to get caught up in legal disputes other than their clients. In attorney ethics, one talks about the professional wearing multiple “hats.” I am a dad, a husband, I own a law firm with business obligations, and I am the attorney to different clients. I don’t stop being a dad at 9:00AM on Monday mornings. For a number of years, I was a member of the Board of Zoning Appeals. You always have to have the ethics “hat” on, thinking about the ethical implications of various questions that arise. Wearing the ethics hat makes you realize that when you are wearing the HOA directors hat you are also wearing the hat of the lot owner, and also as an attorney regulated by the state bar. The character George Costanza on the TV show Seinfeld popularized the phrase “Worlds are colliding!” to describe when people and aspects of one’s life that are normally kept separate sometimes interweave in ways that can (for Seinfeld characters at least) in embarrassingly funny ways. Attorneys frequently experience professional or personal burnout, and sometimes the collision of worlds contributes to this. This blog post is not to persuade attorney readers to join HOA boards or committees or avoid doing so, but to give a few things to think about.
- How to identify as an attorney?: If you run for the board or join a committee, are you going to tout your bar license or law degree? Legal ethics rules require an attorney to take care to determine if an involvement includes a representation. If the activity creates an attorney-client relationship, all sorts of obligations go along with that.
- How comfortable are you with “IDK”? Many believe that if they ask an attorney a legal question they will know the answer or at least provide useful insights. In community association matters many people want a straightforward, standard answer to specific questions. However, useful answers often require careful consideration of relevant language in statutes, governing instruments, or vendor contracts. You may need to make sense out of mysterious silence on an issue in a legal document or apparent conflicts between various authorities. Boards often base decisions on answers to nonlegal, technical questions, such as which groundskeeping chemicals are appropriate, the method of a structural repair, or whether a HVAC system needs to be repaired or replaced. Volunteer directors with limited time on their hands need to be able to say “I don’t know” as appropriate, and to figure out how to get an answer when one is needed. Having a law degree doesn’t change that.
- Are you willing to be a sole dissenting vote? Many directors operate on the incorrect assumption that because they were validly elected and the association has insurance, the majority gets to govern the development as they see fit, because discretion is broad under the “business judgment rule.” Its easy to quip “Everyone gets a vote, no one gets a veto,” at a meeting, but this is misleading. The members, and the board of directors are governed by the statutes and recorded instruments. Even the “king” has to obey the laws. The lawyer may sit on a board or committee where the majority don’t understand the fetters to their discretion. The HOA managers and lawyers are directed by the majority. Since lawyers know more about reading legal documents, they are more likely to understand when the majority and staff are headed in the wrong direction.
- Do you feel comfortable with conflicts of interest? Law is a relationship business. You may get a lawyer job because you know someone. Often you get a new client because someone they trust referred them to you. You need contact list of vendors and other professionals to help you serve clients and operate the firm. Your clients have interests and motives of their own. In community associations, everyone in a position has some sort of conflict of interest – all directors own (and use or lease out) property in the subdivision or building the board governs. Unfortunately, it is not uncommon for directors to steer the budget towards initiatives that benefit them more so than others. Are you prepared to handle a situation where a client or vendor in your law practice is a vendor, manager, other director, or owner in your association that you have a hand in governing? When attorneys represent a close family member or spouse in court, often they have a harder time controlling their emotions or providing independent judgment. Serving as a HOA director in a community where you own a home with your spouse and are also looking to expand your client base can present an opportunity or headaches. Many realtors and tradespersons serve on HOAs for years, in situations where they are swapping referrals with people and getting clients from the community without too many questions being asked. However, attorneys are held to higher ethical standards in certain areas of professional responsibility, and may not be able to get away with the same things as other people.
- Are you going to market yourself professionally while serving? Attorneys are under tremendous pressure to get new clients, keep existing ones, influence potential referral sources or bosses or make connections that could lead to a new job. Many may see board service as an opportunity to do that while donating time to the community. There are many situations where an attorney who is on a board or committee can do that effectively and ethically. In other instances, the activity may not present such options and instead be a drain on one’s time.
I hope that law student or attorney readers of this blog post have read this far and have not already concluded that HOA service is not for them (or that I am raising concerns that will never happen to them). Becoming active in one’s condominium or HOA may be a great opportunity to serve, learn new information and skills, and work with various people. You might even one day run for elected office or serve as a high-ranking political party official. Sometimes when “words collide” this can be a source of stress, but it doesn’t have to end up in a flop like a Seinfeld episode. If more competent, ethical attorneys and other professionals get involved in their HOAs and condominiums in the right way, then this could turn a badly run community into one that is doing its job.