Qualified Legal Opinion is a legal opinion containing conditions or reservations relating to the issue. A legal opinion is issued by a bond counsel for a municipal issuer.
Applying "Qualified Legal Opinion" to Securities Exams:
When a municipality sells bonds to investors it may obtain a legal opinion to help market the bonds. The issuer will hire a lawyer who specialized in municipal bonds to review the bond and offer their legal opinion regarding the tax statues of the bond’s interest payments and the authority of the municipality to issue the bonds. If the opinion is qualified the bond counsel feels that their may be issues that negatively impact the tax status or the authority of the municipality to issue the bonds.