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AnitaM6 (Georgia)
Posts: 14
Posted:
HOA has filed suit against homeowner who opened an Unapproved Business in community where Declaration says NO Business allowed.
The homeowners attorney is the same attorney who wrote the HOA Declaration 15+ years ago. Does this pose a conflict of interest for their attorney?
DouglasK1 (Florida)
Posts: 2,046
Posted:
I don't see any conflict here.

Escaped former treasurer and director of a self managed association.
TimB4 (Tennessee)
Posts: 21,061
Posted:
Their attorney would make that determination.

Something you might want to let your attorney know, in case they don't see the connection.
CathyA3 (Ohio)
Posts: 6,299
Posted:
I don't see a conflict of interest if the homeowner's attorney only drafted the CC&Rs and did not do any other work for the association. But I agree opposing counsel should be alerted (homeowner's attorney is going to be unusually well informed).
MelissaP1 (Alabama)
Posts: 13,836
Posted:
I do not see a conflict. They do not work for the HOA. They did work for the HOA. The HOA has their own lawyer.

BTW: When HOA's have the rule about "No business" it's kind of got a scope to what that means. We call it you can't put a "Shingle up" business. It doesn't say one can't do any of those "MLM" home businesses that don't generate traffic. I could make and sell candles at my home. I just can't put a sign up and use my house as a business. I can go to fairs or sell on the internet. Someone opening up a car repair shop would be in violation of the no business rule.

I've seen some people in HOA's take it a little too far in either direction. I don't have a problem with someone's arts and crafts projects. I would if it was an ice cream shop...

Former HOA President
ElleN (Idaho)
Posts: 4,420
Posted:
Quote:
Posted By AnitaM6 on 01/15/2024 6:41 AM
HOA has filed suit against homeowner who opened an Unapproved Business in community where Declaration says NO Business allowed. The homeowners attorney is the same attorney who wrote the HOA Declaration 15+ years ago. Does this pose a conflict of interest for their attorney?
Short answer: By my reading of the Georgia Rules of Professional Conduct (for attorneys, and which have the force of statute), yes, it is a conflict of interest. But I tend to think the HOA board should not pursue this.

Long answer:
In my opinion, the Georgia Rules of Professional Conduct require (or IMO strongly urge that) the owner's attorney to obtain the "informed consent" "in writing" of the HOA before representing the owner. See Rule 1.9 at https://www.gabar.org/barrules/georgia-rules-of-professional-conduct.cfm . See also Rule 1.7 and Rule 1.8.

Count on it: The owner's attorney will make an argument that there is no conflict of interest. It is indeed a matter of interpretation of several phrases in the Rules of Professional Conduct.

Options:

The HOA can object; inform the owner's attorney that he/she must withdraw from representing the client, or he/she will face a complaint with the bar (which is taxing); et cetera. But the most this will yield is more billable hours for the HOA attorney and that the owner gets a new attorney.

The Board should ask the HOA attorney whether to raise this issue. Ten bucks says the HOA attorney will say something like, "I will bring it to the owner's attorney's attention. But otherwise, I advise not pursuing this. It will cost the HOA money; delay things; and without changing the arguments that ultimately will happen in court. Pursuing this might also annoy the judge."

ElleN (Idaho)
Posts: 4,420
Posted:
Note also that back when the Declaration was first written, the attorney's client was likely the Declarant, not the HOA per se. Arguably, a former client (the Declarant in this case0 is not being compromised here. This is another reason to leave this alone.
DeanJ
Posts: 1,786
Posted:
The HOA is represented by an attorney and they should discuss their concerns with him/her. If there is a conflict, it is the HOA attorneys responsibility to address it.

A court should only consider the facts of the case and what is written in the declaration. It could be problematic in court if the owners attorney attempts to argue he prepared the document and the court should accept his intent / interpretation. There are tactical remedies for this.

CathyA3 (Ohio)
Posts: 6,299
Posted:
Quote:
Posted By ElleN on 01/15/2024 9:26 AM
Note also that back when the Declaration was first written, the attorney's client was likely the Declarant, not the HOA per se. Arguably, a former client (the Declarant in this case0 is not being compromised here. This is another reason to leave this alone.

Yup. The HOA did not legally exist until the Declaration was recorded in the county - which has to occur afterwards.
ElleN (Idaho)
Posts: 4,420
Posted:
Quote:
Posted By CathyA3 on 01/15/2024 9:58 AM
Posted By ElleN on 01/15/2024 9:26 AM
Note also that back when the Declaration was first written, the attorney's client was likely the Declarant, not the HOA per se. Arguably, a former client (the Declarant in this case0 is not being compromised here. This is another reason to leave this alone.


Yup. The HOA did not legally exist until the Declaration was recorded in the county - which has to occur afterwards.
Was the HOA corporation this attorney's client back when the declaration was being written?

Dunno. I believe a HOA corporation can exist (by filing Articles of Incorporation et cetera) independent of the Declaration.

For fun: Over a dozen years ago, I saw a judge disqualify himself from an owner v. HOA dispute because the judge said, at the very first hearing, he had helped write the HOA's Declaration.

Granted a judge's ethical obligations are likely somewhat different from those of the attorney in this thread.

The whole subject is likely academic here. Because I (for one) do not see a good justification to start a dispute about the attorney possibly having a conflict of interest. So far I see only disadvantages to starting such a dispute.

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