Local Law Blogs

Pending Litigation Impacting NY Condominiums and Cooperatives

There are basic laws that governs condominiums (“condos”) and cooperatives (“co-ops”) in New York.  Condos are governed by the New York Condominium Act, Article 9-B, Real Property Law (the “Condominium Act”). Co-ops are governed by the Business Corporation Law.  There are always new issues that arise requiring new laws that impact residents of New York condos and co-ops.
 
One bill in New York that has many residents, board members and managers concerned is the “Fair and Prompt Disclosure Act”, also known as Intro 119.  This bill would require co-ops to provide specific reasons for the rejection of any potential purchaser.  This bill is at the City Council level and is the same as the bill in Albany under consideration, AO1000.  Bill AO1000 requires co-ops to provide a prospective purchaser with a written statement of reasons when withholding consent to purchase and voids any agreement inconsistent with such requirement.  Those who support these bills contend that there is a problem spreading throughout NY relating to discrimination.  Those who oppose the bill rely upon the current laws already in place that prohibit discrimination.  For more information pertaining to this bill, please view the blog posted by Jonathan H. Katz, Esquire of Stark & Stark entitled “Shining a Light on the Co-Op Approval Process” posted on July 10, 2007 here.
 
Another bill, Bill A3677, has been referred to the judiciary to amend the real property law, in relation to requiring hearings before placing liens on condominium units.  This bill would require boards of managers of condominiums to provide a unit owner with an opportunity to be heard prior to placing a lien on such person`s condominium unit.  Currently, condominium owners who withhold  payment  on common  charges  because  the  board  of managers has failed to repair problems, which fall under the  board`s  responsibility,  face  having liens  placed  on  their property. A condo owner with a lien on his or her condo is unable to sell his/her property  and  is  in  jeopardy  of damaging his/her credit  rating and ability to obtain loans. This bill seeks to protect New York State`s many condo owners from  unreasonable financial  hardship  by requiring that boards of managers provide unit owners with an opportunity to be heard.
 
Another bill in Albany that relates to condos an co-ops in New York is A00475.  The bill would require the licensing of building managers of multiple dwellings.  It will also prohibit owners from operating without a licensed manager.  Managers would be required to take building management courses with minimum a number of hours of classroom work conducted or approved by department of buildings.  The bill provides criteria for determining competency to receive a license, how to apply for a license and the revocation and suspension of a license.  It addresses judicial review of department of building’s decision to grant, refuse or renew and revoke a manager’s license.
 
While some legislation is enacted to protect owners and/or residents, Bill A6155 expands the authority of the board of managers.  This bill will allows a board of directors or board of managers to take appropriate action against an objectionable tenant who fails to comply with the by-laws or rules and regulations of the condominium or homeowners association. Failing to comply to the by-laws or rules and regulations of a condominium or homeowners association in a proper case would be grounds to bring a summary dispossess proceeding against the tenant of a non-occupying unit owner, giving the board of directors or board of managers another avenue of appropriate action.
 
There are many local, state and federal bills in consideration.  It is imperative for owners, managers and board members to closely monitor court decisions and legislation affecting co-ops and condos.    We will continue to monitor pending legislation and provide timely updates as to the progress of same.  If you would like to discuss any of the above referenced issues or how they affects your condo or co-op in greater detail, please contact Robyn Nolan Howlett, Esquire at rhowlett@stark-stark.com.

Full post as published by New Jersey Law Blog on December 13, 2007 (boomark / email).