HOW TO HIRE AN ASSOCIATION ATTORNEY

by: Jeffrey A. Goldberg

Most association boards have a pretty good idea how to hire contractors for various services. They will typically have their managing agent recommend a contractor, they obtain three bids, they will sometimes interview the contractor, and then they choose the most appropriate bidder, based upon price and the scope and quality of work proposed.

This process is not very effective when retaining professionals. Few boards know how to hire an attorney.

Every board should have an attorney and should consult with its attorney before making decisions. Since the board members are charged with the fiduciary responsibility of exercising business judgment, it is essential that the board consult regularly with professionals to aid it in making informed, reasonable decisions, complying with its governing documents, and operating within the confines of applicable law. In many respects, the attorney is one of the most important factors in assisting the board to properly carry out its duties. Yet many boards probably do not carry out a reasonable search and evaluation of prospective attorneys and even those who do have an attorney often do not use their attorney in the most effective manner.

Anytime one hires a professional, the most important issue to observe is trust. Having said this, we are unable to define precisely how a trusting relationship is established. We can say that the relationship starts with the board.

The most important thing is to exercise independence. When hiring any professional, such as an attorney or accountant, you want an individual who is completely independent of the managing agent or any contractors who serve the association. You want undivided loyalty to the association. This requires that the board members make an effort for themselves to identify attorneys rather than asking for a recommendation from anyone else.

Of course, it is necessary for the board to identify and consider a number of different attorneys who regularly practice in the area of association law. They must satisfy themselves that the proposed attorneys have broad knowledge and experience in representing associations. This means that once they have identified a number of attorneys, they need to inquire of various managing agents, call up the attorneys' references, and ask around to as many people as they can, to find out the views and opinions of those who have worked with the proposed lawyers.

Once the board has put together a list of possible candidates and is sure that they are capable and have the necessary knowledge and experience to serve the association, then the board must carry its investigation further in order to identify the lawyer's style and approach towards practicing law.

There is no one right way to practice law. It all depends upon what your association, as the client, is looking for in an attorney. Some attorneys are more litigious than others and are prepared to go to court and punish the association's opponents. Some attorneys are at the opposite extreme and settle everything and always try to make peace (perhaps too willing to compromise and give up rights). Some attorneys take a balanced approach and try to settle a case but are equally prepared to aggressively litigate. Some attorneys try to interfere with the board's business by giving unsolicited business advice. Still other attorneys never give an opinion on anything and cannot seem to come up with a straight answer to any legal question posed to them. Some attorneys are accessible and always return phone calls. Other attorneys are so hard to reach than one sometimes wonders whether they actually exist. Some attorneys work in large firms and consider an association client as just another small-time client. Other attorneys treat their association clients as their central clients. Some attorneys utilize hardball tactics to get what they want. Other attorneys are civil and professional at all times. Some attorneys charge for every little thing, and other attorneys are more reasonable with their billing practices. Some attorneys keep up to date with the latest legal technology and constantly improve their operations. Other attorneys fear and distrust new developments in technology and persist in the old ways of doing things.

Although you want an attorney whose philosophy and personality is compatible with the board, you do not want to make the serious mistake of expecting an attorney to compromise his or her professional judgment in order to please you. The biggest mistake boards can make is to pose a legal question to a number of attorneys and then hire the one who tells them exactly what they want to hear. It is a dangerous world of potential liability out there and what you want to hear might be dead wrong. It is also foolish to hire a professional who does not have the integrity to call it as he or she sees it but instead merely panders to the client. It is better to find an attorney that you know you can trust, and you know the attorney has the integrity to investigate the law and tell you exactly what your options are. It is better to find an attorney who will give you advice about what actions you could take but who doesn't try to force you to abide by his or her business advice. When you have a trustworthy attorney, you can feel safe to follow his or her advice even when it is hard for you to accept, but the choice of how to act remains with the board. There is simply no substitute for a trustworthy lawyer.

Once the board has identified trustworthy candidates whose philosophy and approach are a good match with what the board members are looking for in an attorney, it is only then that price should be a consideration. The cost of legal services is an important consideration but is not the primary one. However, when choosing between more than one acceptable candidate, then price can become the deciding factor.

Trying to figure out the relative cost of the services of various lawyers is an extremely difficult proposal. Many attorneys simply quote hourly rates for various individuals in the firm. The partner with the most experience has the highest hourly rate, and the junior associate or paralegal with little experience is quoted at the lowest hourly rate.

There is no way to know how much time a specific legal matter will take or which of a firm's attorneys will work on the case. Thus the cost of legal services remains a mystery until the bill arrives. The differences in ability of attorneys also has a significant impact on the ultimate cost of legal services. A partner billing at $300 per hour may be able to spend 30 minutes or so to make a few telephone calls to resolve a matter. A junior partner billing at $175 per hour might use a different approach that takes 8 hours before achieving that same result. In this example, the cost of legal services with the "expensive" partner amounts to only $150.00 while the "cheap" associate costs the client $1400 with perhaps mediocre or even disastrous results.

A number of attorneys are now quoting fixed or flat fees for various routine services. Again, the board must investigate the information provided to them and determine  the true value of the services. Some fixed fees are very limited in scope. After the fixed fee is charged, many other services will also be charged because they were not included within the scope of the quoted fee. Other attorneys might quote a higher fixed fee, but that includes a number of additional services with no hidden extras. Some attorneys quote estimates that are not binding upon them; other attorneys quote legitimate fixed fees that will not change.

It is clear that a board must take care not to compare apples to oranges when considering which attorney to hire. The board must question the attorney and find out what the actual end cost of various legal services will be. The attorney should be willing to quote a fee or firm estimate for many services. All terms and conditions of the representation should be in writing so it is clear exactly how the attorney intends to charge and what the attorney expects from the client.

In conclusion, hiring a lawyer is a bit different from hiring various contractors. You are entering into what may be a long-term business relationship that requires candidates who are independent, have integrity, and who have the experience and knowledge required to properly meet your legal needs. Only after you identify the trustworthy candidates should the cost of the legal services come into play. When comparing these costs, ask many questions and obtain full information about the actual expected cost of specific legal matters to that an appropriate comparison can be made.