Articles

Client Alert: Knowing When to Call Counsel

Date: December 4, 2025
From approving resolutions to responding to owner requests, community association boards and their management companies are called on to make countless decisions regarding their governance and operations. But even routine operational choices can carry significant legal implications. It is not uncommon for a board to modify an internal document—such as a resident grievance process—only to later discover that the governing documents required a different approach or did not grant the authority to make the change at all. A decision intended to “move things along” can quickly lead to owner complaints or unanticipated liability. At the same time, boards and management do not want to incur legal costs unnecessarily. The goal is to safeguard the association while stewarding its limited resources. The below practical guidelines should help boards and management know when legal counsel should be involved and when legal counsel may not be necessary.
 
When Consulting Legal Counsel Is Advisable
  1. Drafting or amending bylaws and governance documents
    Declarations, bylaws, conflict-of-interest policies, committee charters, administrative policies, and policy resolutions affect fiduciary duties, statutory compliance, and rules and regulations governing owners, particularly those regulating owners’ use of the property, and need to be enforceable if ever challenged in court. Counsel can align documents with governing law, governing documents and reduce the likelihood of litigation challenging the documents and policies of the association.
  2. Handling potential conflicts of interest
    When a director, officer, or key employee has a financial or personal interest in a proposed transaction, counsel can help implement disclosure, recusal, and independent review; evaluate “safe harbor” processes; draft contemporaneous minutes; and confirm whether the transaction is fair and reasonable to the association.
  3. Navigating compliance with state, local, and federal regulations
    Counsel should be consulted for matters involving compliance with state statutes governing community associations, corporate law requirements, applicable federal laws, and local ordinances related to the use and operation of the property. 
  4. Addressing employment law issues
    Hiring, firing, employee handbooks, wage-and-hour classifications, unemployment claims, and accommodations carry legal risk. Early legal input helps prevent disputes and align practices with applicable law.
  5. Responding to litigation or legal threats
    Demand letters, subpoenas, government inquiries, potential insurance claims, preservation holds, internal investigations, and settlement negotiations warrant immediate counsel involvement to protect privileges, manage communications, and coordinate with insurers.
  6. Managing significant contracts
    Significant vendor agreements and management contracts benefit from legal review of risk allocation, indemnities, insurance issues, compliance obligations, and board approvals.
  7. Enforcement actions against owners
    Counsel can help the board establish policies regarding its internal enforcement actions and provide valuable advice regarding any proposed legal actions to enforce the governing documents against owners in court.  Using legal counsel to establish and maintain due process procedures can mitigate the risk of legal challenges to the association’s enforcement actions.
When Consulting Legal Counsel May Not Be Necessary
  1. Routine operational decisions without legal implications
    Scheduling meetings, approving standard program activities within established policies, routine purchases within delegated authority, or ordinary-course budget adjustments may proceed without legal review.
  2. Matters where the board has sufficient expertise and experience
    Where the board or management has established board-approved policies and demonstrated competence (for example, budgeting decisions, recurring or minor contractual agreements, or investment decisions), counsel may be unnecessary.
  3. Matters where management has sufficient expertise and experience
    In day-to-day operations, professional property managers can often respond to and handle issues such as communications with vendors, communications with owners, and expenditure of budgeted association funds without consulting legal counsel.  Given their training, property managers can also be relied upon to advise boards when an issue does necessitate the involvement of counsel.
  4. Issues that are purely administrative or procedural without legal risk
    Internal reporting formats, volunteer recognition plans, or nonbinding strategic discussions that do not alter governance documents or change legal rights can generally be handled internally.
Balancing Legal Advice with Practical Decision-Making

Legal counsel is a governance tool that is intended to support the board in fulfilling its fiduciary responsibilities to the community association. Boards should:
 
  • Calibrate legal involvement to risk and materiality.  Management can be particularly helpful in identifying issues that require counsel.
  • Integrate legal advice with financial and operational considerations, ensuring decisions are timely and well-documented.
  • Budget for preventive counseling; early advice typically costs less than remediation.
  • Maintain and periodically update core templates and policies so routine matters stay routine.

A disciplined approach—seeking counsel for high-risk, high-impact matters and relying on management expertise for low-risk operations—advances fiduciary duties, protects the organization, and conserves resources.  A brief consultation with our team can help ensure that your board and management are acting within their authority, abiding by their governing documents, and implementing changes in a way that protects the association.  Establishing effective and consistent habits around the use of counsel saves time, reduces costs, and helps keep associations running smoothly.

Our team at Whiteford is always available to assist and to help your association meet its governance and operational needs. Please feel free to contact our team if your board is interested in additional guidance or internal policies on consultation with legal counsel.
The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation.