Can a not for profit corporation attorney bill for services that violate the Federal tax codes on self dealing for insiders? The association attorney is billing for legal services for a board member who did something that is not permitted under our Articles of Incorporation.
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Read More Answered By: Sarah Grosse |
It depends on who the attorney's client is. If the client is the corporation, then the attorney should bill the corporation. If the board member is the client, the attorney should bill the board member. If the client is the corporation, who is speaking through a duly authorized board member (such as an officer), then the attorney should still bill the corporation. If there is a conflict of interest between the corporation and the board member, then the attorney should clarify the representation and recommend that the other party retain its own counsel. If the board member has acted on behalf of the corporation, but improperly, the corporation may still be liable unless the board member acted willfully and wantonly (not merely neglegently). If it is found that the board member acted willfully and wantonly, the board member may be required to indemnify the corporation for any damages.
You see, this is not a simple question, and without many more details, there is not a simple answer. I just gave you a few of the many possible permutations of the problem. |
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