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Examination of books and records by board members

Q. I am the treasurer of our condominium association. From time to time, I have requested certain books and records from the board in order to carry out what I understand are my duties as treasurer. However, the board president unilaterally denies my requests. Do I have a right to these records?

A. Whether or not a board member has an unrestricted right to examine and copy books and records of an association does come up from time to time.

It appears the issue has been the subject of only two significant appellate court decisions in Illinois. The first is from 1895 (however, cases prior to 1935 do not have precedential value) and the most recent is from 1959. Both cases involve the denial of a sitting board member's request to obtain copies of corporate books and records. In both cases, the court happened to find that a board member was entitled to the requested books and records. However, there is helpful discussion in the cases that I will summarize and paraphrase.

A board member has a fiduciary duty to the unit owners. In that capacity, a board member has the right to examine books and records of the association. However, the cases do indicate that a seat on the board does not give a board member a completely unrestricted right of access to all of the books and records of the association.

Certainly, a board member has the right to examine books and records related to a matter that is under consideration by the board. And the cases seem to suggest that a board member has a right to examine the books and records of the corporation, if she has reason to think that they contain information that a knowledge of will assist in the board member's service to shareholders (owners).

However, if a board member desires to view books and records out of mere idle curiosity, for personal benefit, or is simply on a "fishing expedition," or if under the circumstances it would be impractical and unreasonable for every member of a board to get copies of books and records, even though they are part of a corporation's records, a board member need not receive them.

The example given in the case was the highly secret Coca-Cola formula, which the board did not have to make available to the requesting board member. There may be analogous books and records of the association that are protected from disclosure, but that would be reviewed on a case-by-case basis. If there is a genuine basis for a board member being denied books and records, it should be asserted openly and made the basis for a legal objection at a meeting.

The point is that the burden will be on the board to show that the books and records should not be made available to the requesting board member.

A request to review books and records by a board member that is not supported by case law should be considered by the board to have been made in that board member's capacity as a unit owner, and not in the board member's capacity as bard member. Such requests should be considered by the board and can be evaluated under Section 19 of the Illinois Condominium Property Act, or Section 1-30(i) of the Common Interest Community Association Act, as applicable concerning examination of books and records by unit owners.

• David M. Bendoff is an attorney with Kovitz Shifrin Nesbit in the Chicago suburbs. Send questions for the column to him at CondoTalk@ksnlaw.com. The firm provides legal service to condominium, townhouse, homeowner associations and housing cooperatives. This column is not a substitute for consultation with legal counsel.

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