Ask an Expert
Ask an Expert: My co-op board keeps too many secrets
Q. My co-op board operates in a veil of secrecy, without telling residents about major and minor events until they are fait accompli.
They closed the roofdeck for an entire summer for renovation without telling us in advance. Now I heard a rumor that they want to outsource the super to sell his apartment and raise money for the building.
Is that legal? Don't we have a right to know certain things and at least give our opinion or maybe even vote?
A. The answer is yes--and no(ish), say our experts.
Your co-op's offering plan, like most others, probably requires your board to hold an annual meeting for elections and to report on the physical and financial condition of the building.
At the same time, boards have "the authority to make most decisions without unit owner input," says asset manager and real estate broker Roberta Axelrod of Time Equities, who serves as a sponsor's representative in many buildings throughout New York City.
Your board's unilateral power doesn't necessarily include the sale of your super's apartment though. Most offering plans would require a vote of owners to approve the sale of a common element like this, says Axelrod. Check your offering plan for specifics including the percent of votes required for approval.
As to how transparent a board should be as a general matter? Property manager Michael Wolfe of Midboro Management says that "in most co-ops, the board can be as vocal or as silent as they would like. Although we believe in proper communication and transparency, some boards are less communicative than others."
Legally speaking, it's okay for a board to play things close to the vest.
"There is no specific law that sets the standard for what constitutes sufficient disclosure, the board of directors has a duty to keep shareholders informed," says co-op and condo attorney Dean Roberts of Norris McLaughlin & Marcus. "The legal instrument by which this occurs are the board minutes, which are the written record of board action at its meetings. The form of board minutes is as varied as there are cooperatives. Some have extremely detailed minutes which include the discussion and debate while others merely state who is present and what if any specific votes were held."
You and your neighbors can also request a face-to-face Q&A session with the board.
Co-op bylaws "provide shareholders with the right to call special shareholder meetings, usually by securing some percentage of shareholder signatures requesting the meeting, at which individual shareholders may seek answers to their questions," says Roberts.
If you and your neighbors don't like how the board is operating, "speak up at the annual meeting, and run for the board," says Axelrod, noting that "owners tend to be happiest in buildings that communicate with periodic newsletters or meetings."
Trouble at home? Get your NYC apartment-dweller questions answered by an expert! Send us your questions.
Visit The Board Room>> [sponsored]
Brick Underground articles occasionally include the expertise of, or information about, advertising partners when relevant to the story. We will never promote an advertiser's product without making the relationship clear to our readers.
