The Florida Bar

March 28, 1969

A law firm may represent both a developer of a condominium and an association of residents, control of which temporarily resided in the developer, in the absence of any antagonistic interests, provided that the protections afforded by law to the minority interests of the residents are observed.

Canon: 6

Chairman MacDonald stated the opinion of the Committee:

A member of The Florida Bar apprises us as follows:

The problem which we would present to you and your Committee is as follows: This office has been retained by a corporation, profit making, that builds and sells condominium units. We will refer to the client hereafter as the “Developer.” We have prepared for the “Developer” a declaration of condominium, a copy of which we are enclosing herewith for your review, wherein it is provided that each purchaser of a condominium unit become a member of a non-profit corporation which we will hereinafter refer to as the “Association” (see paragraph 13 of the declaration of condominium). Now the “Association's” purpose is to govern the affairs of the Condominium. The “Developer” through the declaration of condominium and its By-laws in fact controls the “Association” by retaining unto itself the right to elect a majority of the directors of the “Association.” The “Developer” loses this right and thus the control when about 90% of the condominium units are sold. The purpose of the control is indeed obvious. The “Developer” is interested in seeing that his development is handled in such a fashion that will induce sales and in this regard, properly maintain the condominium development. Subsequent to sale of, as stated, 90% of the condominium units, the control then passes to the parcel owners.

We are representing the “Association” as well as the “Developer.” At a firm conference, when the matter was discussed, someone raised the issue as to the ethical propriety of representing both the “Developer” and the “Association” since the “Developer” controlled the “Association.” This is the question that we pass on to your committee.

The Committee, two members dissenting, has concluded that there is no immediate conflict of interest in the present representation of the developer and the association under the circumstances described in the inquiry. Naturally, representation of the majority interests involved requires that any protections afforded by the law to the minority be observed. Counsel representing the majority should exercise particular care to see that, to the extent such protections are within the purview of his professional responsibilities, they are scrupulously observed. Moreover, should the interests of the developer and the association become antagonistic, cause might arise at that time for withdrawal of the representation of either or both parties as may be dictated by the circumstances then present, a question which naturally we do not apprehend at this time.

[Revised: 08-24-2011]