The Value of an Answer
Occasionally, we are asked questions by board members or property managers who place a restriction on us: “I only want an answer if it is free.”
At WesternLaw Group, we appreciate that Associations run on a tight budget. The Association operates by and through its Board of Directors, who have a fiduciary duty to the Owners to manage the Association’s affairs in an economic manner.
However, those same Directors also have a duty to manage the affairs of the Association responsibly. When a manager or director states, “I only want an answer if its free”, that puts us both in a tricky place: a legal question was posed, a quick legal answer may not be possible, our client apparently doesn’t place significant value on that legal answer, and lack of a correct legal answer could send our client down the wrong road.
Yes, some answers are free (see discussion of our retainer program, below). Sometimes, however, they are not. Where no free answer is reasonable, it is our responsibility to inform our client of prospective fees, and to encourage the Board to make a responsible decision with regard to obtaining answer. That encouragement may be: requesting that the Board obtain additional information, referring the Board to its property manager, or recommending that WesternLaw Group be permitted to produce an answer, despite a cost to the Association.
In the event the Board refuses to hire counsel to produce a legally supportable answer, neither party can properly discharge their duties: WesternLaw Group cannot properly advise its client, and the Board may be failing to manage the affairs of the Association responsibly.
Of course, knowing budgetary limitations is helpful and we always appreciate that input. We will attempt to work within those budgetary limitations as much as possible, but we are hope our clients realize a) that we could not be a sustainable business off of monthly retainer fees alone, and b) we provide a service that has value. We hope all of our clients and property managers see that value consistently. If there are times where you do not, please call and we can set up a meeting to discuss the issue(s) and related billing.
As a reminder, we do offer a retainer program. For a low monthly rate, retainer clients receive a whole host of benefits (which are not listed in their entirely here, as some are not relevant to this article). Two benefits are worth mentioning here:
Unlimited phone and email for issues not involving research. The language in our retainer agreement states as follows: “We offer unlimited telephone calls and e-mails with the community association manager and Board members on general business matters not involving research.” There are plenty of questions that don’t involve research, and we hope boards make frequent use of that perk. Our basic criteria: if we can answer an email or phone call without resorting to reviewing any documents, it clearly falls into covered communication under the retainer agreement.
Reduced hourly rates. When a question does involve research, such subject is no longer covered by the retainer agreement and the Firm needs to be permitted to bill for it. For retainer clients, that billing is performed at reduced hourly rates. “Research” may range from a brief review of the governing documents to extensive statutory and case-law research.
In the end, it is important to us that both retainer and non-retainer clients believe they are receiving quality work at a reasonable value. Assuming an Association agrees, the Board is wise to keep in mind that there is value in a well-researched answer from an expert in the field.