HOA attorney fiduciary duty to homeowners

State supreme courts have court rules or procedures that must be followed for due process protections and the fair and just treatment of the litigators. One such important provision of the Rules of Civil Procedure, R11(b) in the federal rules and R11(a) in Arizona for example, pertains to the statements made by the attorney in the court papers that the attorney signs. It says, in part, from the Arizona rule:

"The signature of an attorney or party constitutes a certificate . . . that to the best of the signer's knowledge, information and belief formed after reasonable inquiry it [the complaint] is well grounded in fact and is warranted by existing law . . . and that it is not interposed for any improper purpose, such as to harass . . . or needlessly increase the cost of litigation."

From an article in the Arizona Bar's June 2005 Arizona Attorney magazine, former Chair of the Disciplinary Commission of the Arizona Supreme Court, David Dodge, cautioned attorneys about being held liable for breach of fiduciary duties to the beneficiaries in a fiduciary relationship. For HOA related matters, it means that the HOA attorney may be held liable for aiding and abetting a breach of fiduciary duties by the HOA board.

For more information, read the paper on Derivative Fiduciary Actions.