Although co-op and condominium apartment owners often seek transparency and a clear understanding of the actions of their boards, board members and managing agents should be judicious in sharing material non-public information with non-board members. Material information encompasses all board discussions that, if inappropriately or prematurely divulged, can potentially cause injury or mistrust of directors.1 Disclosing board deliberations or voting records relating to issues such as whether to refinance the building’s mortgage, levy an assessment, or the like, may lead to a disruption of or conflicts in the residential community and result in litigation.2
Protecting the confidentiality of material information is key to facilitating candid discussions in the board room, avoiding needless litigation, and preserving stability in co-op and condominium entities. This column considers board members’ implicit duty of confidentiality and suggests best practices for maintaining board matters in confidence unless and until the board as a whole decides that such information should be disclosed.
Attorney-Client Privilege
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