• Phone314-637-0660
  • Address670 Office Parkway, Creve Coeur, MO 63141
  • Phone314-637-0660
  • Address670 Office Parkway, Creve Coeur, MO 63141

The Law and Community Association

Questions & Answers

Guidelines for board members


In St. Louis, hundreds of communities are managed by volunteer homeowner boards.  No better example of democracy in action can be found.

These volunteers are providing a vital service to their neighbors, preserving and adding to their property values.

People from all walks of life, education, age, and experience serve on community boards.  No special training or background is required.

Most board members contribute a bit of their time, experience, and energy, the board meets and conducts its business, and the community functions without problems.  That is, most of the time.

The system works because boards are expected to have personal knowledge of all the technical and legal aspects of management.  They are expected to hire experts and are then entitled to rely on their advice.

The informed and prudent board will surround itself with competent professional advisors.  If the board follows the recommendations of its advisors, the chance of a serious problem arising in the first place is very much reduced.

Then, in the very unlikely event that a problem does occur (even if the advice itself is faulty), each board member of the community has an excellent defense.  They exercise their duty by hiring professionals and followed their advice.

One very important area where expert advice is required is the use of an attorney.  That is what this handbook is about.

DNI’s practicing professional managers, with an accumulative aggregate of over 100 years of related experience, prepared this handbook.  They began by putting down just what they had learned about how to best use attorney’s in management.

Then we turned to our National Community Association Institute (CAI).  Local attorney members are specialists in Community Management and are contributing their time and experience to further the art of community management.

Their contributions were very significant; by encouragement in the early phases, by their suggestions, and in their review of our final copy.  We thank them for their contributions.

There are of course many qualified attorneys who can serve communities and provide competent professional advice who are not members of CAI.

We do not suggest that there would be a difference, both in the timeliness and in the cost-effectiveness in selecting an attorney with prior community association experience.

This handbook is not a legal manual or guide.  It does not contain legal advice.  It was written for board members to give them an understanding of the role that attorneys play, and the cost-effective use of attorneys.

It was prepared just for you, the unsung, unheralded, and unpaid members of community boards.  You are contributing your time, your experience, and your energy.

This Handbook was prepared to answer your questions.  We could not put everything in this book and keep it short enough so that you would actually read it.

Have we helped you understand the issues?  Do you have more questions?  We invite your comments to your property managers or to me.

My doors (and phone) are always open.  I would like to hear from you.

Doug Gardner, President
DNI Properties, Inc.



Boards have an important fiduciary responsibility to manage their community so as to avoid claims against the community.

Members of boards are not expected to have personal knowledge of the law.

The board should select an attorney who will be familiar with the community and its by-laws so that advice can be provided promptly and at a reasonable cost.

The property manager should arrange occasional reviews with the attorney and the board.  Good communications are essential, and the responsibility of the property manager.

The board must determine that the appointed management company understands the role of an attorney and is selecting and supervising its managers with attention to liability matters.

The property manager should have a good understanding of the law and should advise the board when an attorney should be consulted.

A good relationship between your property manager and your attorney will keep legal costs under control and avoid problems.

The small amount spent in legal reviews and advice will pay large dividends to your community in keeping liability and risk under control, and in your peace of mind.

Questions and Answers

Does a Community Association need an attorney?



A qualified attorney, familiar with your articles, rules, and general management picture should be “on call.”

When an issue requiring legal advice arises, the board then can focus on the issue, and will not be distracted or concerned by the need to find an attorney.  The board will get fast, competent advice at lower costs.

When should an attorney be selected?

Appointment of an attorney should be one of the first acts of a board when first acts of a board when first convened after a board election.

This should be done before a need arises.  Competent, timely advice can be obtained.  The operative concept is prevention.

Why should a board member care?

Personal liability!

Persons who believe they have suffered loss can file a suit against the Association or individual board members.

Board Members may have personal liability.  Even if a board member merely casts a vote with the majority, each person on the board is accountable for board decisions.

It takes money to fight a lawsuit.  Board members must have the assurance that they are not doing something that will invite a lawsuit, and if filed, can be well defended.

Any other reasons?

Fiduciary Responsibility!

As a member of the Board, you will have basically the same fiduciary responsibility to your community and neighbors that a corporate board of directors has to shareholders.

Your home owners are trusting you with the management of your community.  Decisions made by your board will affect the value of their homes.  Money collected by the association is held for the benefit of the community.

This is a very serious responsibility.  You can exercise that responsibility easily, without a lot of specialized knowledge if you have professional advice.

You are NOT expected to have the know-how yourself.  You are entitled to hire experts to advise you.  With professional advice, you can protect the value of your community.  Following professional advice is a defense to claims of breaching fiduciary duties.

Involving an attorney at an early stage not only avoids problems but is far less costly than when a situation has spun out of control.

If you select and retain a licensed and experienced attorney to review your practices and give advice when requested, you are exercising your fiduciary responsibility to avoid suits against the community.

Can board members get insurance?

Yes and no!

Directors and Officers Insurance is an adequate amount can and should be obtained.  Your property manager knows how to arrange that for you.

Having insurance is like having a fire extinguisher in your building.  If there is a fire, you may be able to put the fire out, but you want to avoid a fire in the first place.

You and your board should not knowingly do something that will bring the risk of a lawsuit without specific assistance and advice from your attorney.

If the board proceeded against the advice of your attorney, your might want to consider resigning or making sure your opposition was clearly noted in the written minutes.

Although Directors and Officers insurance would protect board members against damages up to the policy limits, and for attorney’s fees, the toll that the time and worry can take on a board member makes avoiding suit a high priority.

You need competent legal advice to avoid claims against yourself and the community.

Can’t your Property Manager give the legal advice needed?

No!  There are many reasons; some are listed below…

The board must have a contract with it’s Property Manager, defining responsibility and liability.

The manager cannot give the board advice on its own contract.

It’s against the law.

A Property Manager giving legal advice would have its license revoked.  A Property Manager cannot give legal advice under the law.

It is a breach of your fiduciary duty.

A board that accepted or acted on legal advice from the Property Manager would be exposed to claims of mismanagement.  Homeowners could successfully sue board members who did that.

Doesn’t the manager have any knowledge of legal matters?

Yes, but your manager needs professional legal advice.

There is an important distinction between knowing the law and giving legal advice.

A manager cannot keep up with all the changes and principles involved in community law.  That would be a full-time job.

A manager that did not know the law and has experience in Community Management would make mistakes.  The board would not have the advice it needed.  Lawsuits would result.

Relying on a manager’s advice regarding legal questions does not protect the board from liability, since the board knows that a manager no matter how experienced is not an attorney qualified to give legal advice.

The board can rely on the property manager to know what advice to give, where to draw the line, and when an attorney is needed.  If the property manager recommends an attorney, then the board should approve that recommendation.

What legal experience should a professional manager have?  A great deal…

A lawyer cannot be consulted on every act of the board or its manager.  It would be both impractical and costly.

The board must be satisfied that the manager knows how to act to avoid liability.  When the manager advises the board to obtain legal advice, the board should act.  Some of the subjects are…

Uniform Condominium Act

The manager should be familiar with the Missouri Condominium Act.  The manager must know generally how the law applies to the community management process.

Civil Rights Act

The manager must know about the Federal Civil Rights Act, and the protected classes as defined under the act.

Worker’s Compensation

The manager must understand the Federal Worker’s Compensation laws and how to protect the Association from claims resulting from injuries to contractor’s employees.


The manager must understand the fundamentals of contracts; what a contract is, when and how parties are bound, consideration, definition of parties bound, subject matter, termination provisions, among others.

An experienced property manager has had the background and training in guiding a community in its affairs.  That manager should have negotiated and executed many commercial contracts for communities.

What about the Management Company?

The management company has a responsibility to provide for continuing education of its employees in legal matters.

The law and practices of community management are constantly changing.  There are new laws and court cases every month.

The company should have issued policies and guidelines to the manager and make sure they are followed.

Supervision of Managers should include an audit of legal issues handled.  Is the manager requesting legal advice when needed?

The management company should require that its managers attend CAI meetings and review the CAI publications for current information on management issues and practices.

What legal expertise should Board Members have?

A board member is not expected or required to have any specialized legal knowledge.

Boards should know the distinction between community and personal interests.  You have been elected to represent the entire community in the management of the community business affairs.  Board members should understand broadly the fiduciary responsibility they hold, and what that means.

Each member of the board brings certain experience and judgment to the board.  You are expected and should follow your instincts, and apply that experience and judgment.

Legal issues should be explained in terms you understand.  If you feel that there may be a legal or liability issue involved, you should raise the question with your board, or ask your manager.

What is a conflict of interest?

A conflict of interest is any situation where a person has fiduciary responsibility and will benefit personally.

If you feel that you are in a position to receive a personal benefit that is different from other homeowners, you should declare that interest, and abstain from voting on that issue.

You should be alert to conflicts of interest in other board members, with the manager or the management company, or even your attorney.  If you sense that, it is your duty to raise that point.

What if the property manager and your attorney disagree?

Your property manager and attorney should have reached an understanding on the management process.  Each must respect the competence and experience of the other.

Your attorney and your manager should have an understanding about what should be referred to the attorney.  This will vary, depending on the views of your property manager, and the views of your attorney.

The key to successful relationships is communication.  Your Property Manager should take the lead on this.  All will be kept going smoothly, and legal costs under good control, while assuring peace of mind to the board.

Should the property manager have the authority to give legal assignments to the attorney?


If the manager feels that an attorney should be consulted, that matter should be brought to the board for their approval.

The manager should present the issue to the board in terms they can understand, and to submit the request to the attorney in a form that will result in good advice at minimum cost.

An experienced property manager will know how to do this, saving the attorney’s time, and the association’s money.

When should a written legal opinion be obtained?

If an issue is important, if there are several different views, or if a lot of money is involved, the board may want a written opinion to support their decision.

In general, this requires research and is more costly.  A written opinion may be a good idea in complex matters involving setting of rules or policies, or in disputes with homeowners or contractors.

The property manager should guide the board on matters that may require a legal opinion.  If the manager recommends a written opinion, the board should act on that recommendation.

How often should a board meet with its attorney?

DNI recommends an annual “checkup;” a review of the board’s articles, current management practices, and an update on legal matters of importance.

The meeting should be organized by your property manager.  A face-to-face meeting with the attorney will assure open communication and add to the board’s peace of mind.

Suggested agenda items:

  1. A summary of the boards’ management process; the performance of the management company as it relates to collections, disputes, and contracts.
  2. A briefing on current matters concerning liability as related to Community Associations; important laws and court cases.
  3. An interpersonal “refresher,” so that the board is acquainted with the attorney and comfortable with the relationship between the attorney and the management.
  4. An overview of the board’s legal documents; indentures, rules, and regulations.  Identification of matters requiring attention and suggested changes in rules.

With the right preparation, the cost will be very nominal related to the benefits and peace of mind.  New board members can get acquainted and comfortable with their legal counsel.

How does a board select an attorney?

An attorney should be a member of the bar in Missouri and licensed to practice law.

Sometimes an attorney is appointed because someone on the board knows a “good” attorney.  “Good” in this sense does not confer the know-how and prior experience to give cost-effective service.  The result is that the attorney will be learning at community expense, billing the association for the research required to give competent advice.

Your attorney should have experience in community law.  If your attorney has other community clients, then your attorney has had some experience in the kind of matters you will need advice on.

If you were facing a special medical surgery, you would seek a doctor with a track record in that particular procedure.  You would apply that same reasoning to the selection of an attorney.

Attorneys who have an active practice representing communities are members of CAI (Community Association Institute) and attend their meetings.

CAI is a national non-profit organization dedicated to professional development of community management.  CAI publishes legal briefs for attorneys and management papers for managers.

An important consideration is the ability to communicate.  To some degree, this is a personal matter.  Attorneys are people too and differ in their personal style and communication ability.  You are looking for an attorney whose personality will mesh with the board and the community.

What about fees?

The fees charged by an attorney are a community expense.  Hourly rates charged by attorneys vary.  Differences in hourly rates will not affect costs as much as the planning and organization of the legal program by the property manager.

The small amount spent on the prevention of liability will save much more than the costs of mistakes.

Concerning costs, of more importance is your property manager’s plan to get the best use of an attorney.  Much of the work done can be delegated to the property manager, with the advice and consent of the attorney.

Qualified CAI Member Attorneys

CAI provides a directory of members who are attorneys.

DNI can discuss the selection and appointment of an attorney with the board and can make suggestions.

The final decision and appointment should be made by the board after a personal meeting with the attorney.