Introduction

Non-profit boards are the backbone of countless community institutions – from homeowners associations and religious congregations to private schools and arts organizations. Yet, when these boards face litigation, the dynamics of representation differ significantly from those in the corporate world. Defense counsel must not only manage legal strategy but also navigate the interpersonal and structural complexities of volunteer-led governance. This article outlines best practices for insurance defense attorneys representing non-profit boards, with a focus on fostering effective attorney-client relationships that support efficient, ethical, and successful litigation outcomes.

Understanding the Non-Profit Client

Unlike corporate boards, non-profit boards are often composed of volunteers with limited legal or governance experience. Their motivations are frequently personal – rooted in community, faith, or family – which can complicate their perception of litigation and their expectations of counsel. These boards may include inexperienced members unfamiliar with legal processes, long-tenured members whose identities are closely tied to their board roles, and professionals (e.g., attorneys, engineers, former public officials) who may influence internal dynamics. Understanding these personal and political undercurrents is essential to building trust and managing expectations.

Establishing the Relationship: First Steps Matter

Coordinate with the Claims Professional

Before initiating contact with the insured, defense counsel should consult with the assigned claims professional. This ensures alignment on coverage determinations and any reservations of rights, prior claim history, and strategic objectives and communication protocols. This step also helps preserve the insurer-insured relationship and facilitates a smoother introduction of counsel.

Make a Strong First Impression

The initial conversation with board leadership – typically the president or chair – should clarify that defense counsel represents the board, not the insurer, address misconceptions about the tripartite relationship, and establish a tone of professionalism, empathy, and collaboration. Avoid engaging the full board at this stage. A smaller meeting allows for a more focused and productive dialogue.

Structuring Communication and Governance

Form an Executive or Litigation Committee

To streamline communication, counsel should recommend forming a liaison group (e.g., executive or litigation committee). This avoids the inefficiency of involving the entire board in every decision and helps maintain confidentiality and consistency.

Clarify Privilege and Conflicts

Counsel must explain the scope and fragility of attorney-client privilege in a multi-member board context, the importance of confidentiality among board members, and potential conflicts of interest, particularly when individual board members are implicated in the dispute. If conflicts arise, separate counsel may need to be appointed to preserve ethical boundaries and avoid prejudice.

Due Diligence: Information Gathering and Legal Framework

Key Documents and Data

Defense counsel should request and review articles of incorporation, bylaws, declarations, rules, board meeting minutes (at least 12 months), election records, board member rosters, and communications relevant to the dispute (emails, texts, social media). Ensure all documents are current and properly enacted. Verify that any rules or amendments were adopted in compliance with governing procedures.

Understand the Legal Framework

Counsel must be fluent in state statutes governing non-profits or community associations (e.g., Not-for-Profit Corporation Law, Uniform Condominium Act), the organization’s governing documents, and applicable federal tax-exempt provisions (e.g., IRC §501(c)(3)). This legal literacy enables counsel to interpret disputes within the correct statutory and organizational context.

Managing Expectations and Ethical Boundaries

Collaborate with Private Counsel

Many non-profits retain general counsel for transactional or advisory matters. Defense counsel should clarify roles and avoid overlap, coordinate messaging and strategy, and leverage private counsel’s institutional knowledge. This partnership is particularly valuable when litigation resolution involves amending bylaws or other governance documents.

Address Coverage Questions Appropriately

Defense counsel should not opine on coverage issues. Instead, refer such questions to the insurer or private counsel and reinforce the separation between legal defense and coverage determinations. This preserves trust and avoids ethical pitfalls under the tripartite relationship.

Preserving Evidence and Ensuring Compliance

Counsel must guide the board on preserving emails, texts, and social media posts, avoiding use of personal or work accounts for board business and implementing litigation holds across current and former board members. Failure to preserve evidence can jeopardize the defense and expose the organization to sanctions. Counsel should also consider engaging vendors to assist with data collection and preservation, particularly in complex or high-volume cases.

Conclusion

Representing non-profit boards in litigation requires more than legal acumen – it demands emotional intelligence, strategic communication, and a deep understanding of organizational dynamics. By following these best practices, defense counsel can foster trust, enhance collaboration, and ultimately achieve more favorable outcomes for all parties involved.