Legal Fees

Our Association budgets $18,000 per year for legal fees. If the Association wants to place security cameras at the gate which cost more than 5% of the annual budget it must be approved by 51% of the Members. Is there any restriction to what an Association can spend on legal fees without a vote of the Members? 20% of our budget last year was spent on legal fees.

Richard,

I don't recall seeing anything about legal fees in the D-S Act and I would be surprised if it were mentioned in your gov docs. The requirement for the members to vote if a capital improvement would cost most than 5% of the annual budget is quite different than requiring a vote to seek legal advice even if the legal expenses for the year would amount to more than 5% of the annual budget.

I looked through the D-S Act and couldn't find anything on limiting legal over a % of the operating budget. For an Association with 317 homes they spent $100K on legal. There is a HOA a couple of miles from us with 630 homes and their legal fees were $79 for fiscal year 2008. I know that spending that kind of money was not in the best interest of the Association.

The legal fees spent have been a secret to the Association. Myself and others have inquired and come to a dead end with the Board and PM.