Q&A: Sue Me!

Q I live in an association in southern Florida that is rather small. The board  recently got threatened with a lawsuit from a unit owner, and while we'll be  consulting an attorney soon, we're not sure how to interact with the unit owner  should they go ahead with the lawsuit. We're also concerned how much a lawsuit  could cost the association, and what to be prepared for on that end.  

 —Waiting in West Palm  

A “During litigation, there are Rules of Professional Conduct that must be followed  by party representatives,” says Jeffrey Greyber, an attorney at Merlin Law Group in Tampa. “More specifically, Chapter 4 of the Rules Regulating the Florida Bar dictates  how party representatives are to behave throughout litigation From these rules,  the parties themselves can also largely glean how it is that they are supposed  to behave. In part, these rules address privileges, confidences, and immunities. Just about all information and documentation exchanged exclusively between an  attorney and an attorney’s client is shielded from discovery by any other party. This is called attorney-client privilege. But I underscore the word “exclusively”—beware that the sharing of attorney-client privileged information or  documentation with a third-party will almost always spoil the privilege and  will allow the opposition to discover same. Also, bear in mind that ordinary  board minutes (i.e., board minutes not involving the association’s attorney) are often discoverable. This is not to say that board minutes will ultimately be admissible at trial,  but discovery standards are less stringent than admissibility standards.  

 “In my world (which is the insurance world), attorneys’ fees and costs will almost certainly exceed six figures if the matter proceeds  through verdict. But my clients (policyholders) can rest a bit easier in  knowing that there is the possibility of fee shifting under Sections 627.428  and 624.155 of the Florida Statutes; i.e., there is the possibility of the  insurance company paying my fees upon a resolution favorable to the  policyholder. Notwithstanding the possibility of fee shifting in some contexts and the  possibility of finding an attorney who will work on a contingency fee basis,  and lest an association end up in financial distress, an association should  carefully consider whether the reserves that it has in place at the outset of  litigation can handle six figures in fees and costs. Of course there is always the possibility of special assessments, but that is  often an arduous task, especially when it comes to litigation-related special  assessments.”