Page 1 - CooperatorNews New York June 2022

June 2022 COOPERATORNEWS.COM William McCracken, a partner with the law firm of Ganfer Shore Leeds & Zauderer in New York City, explains that in New York, understanding the difference in ownership rights is key to understanding evictions in co-ops and condos. “Condo unit own- ers own their units,” he says. “The condo board has no standing. Because a co-op shareholder has a tenant-landlord relationship with the board under a proprietary lease, for purposes of evic- NEW YORK THE CO-OP & CONDO RESOURCE COOPERATORNEWS 205 Lexington Avenue, NY, NY 10016 • CHANGE SERVICE REQUESTED In a rental building, the landlord has certain rights under certain circumstances to remove a tenant from his property before the expiration of their lease. In a private home setting, the only real path to removing an owner is through foreclosure—usually due to a mortgage default. But what about in a multifamily setting like a condominium or a co-op? In short, it’s complicated. To start off, in the legal world, the word eviction has a very specific meaning, differ- ent from how most non-lawyers understand the term. Attorneys often prefer to use the term ‘remove’ or ‘eject’ when speaking about forcibly getting a condo owner or co-op shareholder out of an association or building. For the purposes of this article, however, we will use the colloquial ‘evict’ and ‘eviction’ to keep things simple. Can an Owner be Evicted? According to Scott Piekarsky, an attorney with Phillips Nizer, a law firm located in Hackensack, New Jersey, “You can eject a shareholder from a co-op—but you can’t evict a condo owner from his or her unit.” That said, removal can occur for monetary or non- monetary reasons. In the case of monetary default, which is the more common reason, “an association can put a lien on the unit for outstanding common charges, and then foreclose on that lien,” Piekarsky says. “The lien has a priority over the first mortgage and tax liens. The association can pursue a foreclosure, and then a sheriff’s sale subject to the lien. In the end, if the foreclosure and sale are successful, the association gets the unit and the owner is out.” So, the process is not an eviction per se—but a means of re- moving a non-paying association member and recouping the monies owed. continued on page 2 Even before the pandemic and social unrest of the last few years, interpersonal conflict and outright hostility often sur- faced in the co-op and condo environ- ment, forcing boards and managers to deal with both legitimate grievances and conflicts that are sometimes less than ra- tional. Whether a conflict arises between neighbors, between residents and man- agement, or between tenants and the board, it’s vital to address it swiftly and diplomatically to maintain a function- ing, livable community. Sources of Problems Michelle P. Quinn, a partner with Ga- llet Dreyer & Berkey, LLP in New York, says typically, the three main sources of conflict concern odors, noise, and leaks—and during the pandemic, when people were home so much more, these issues became even more prevalent. “Odors could have to do with a build- ing’s ventilation system, so that’s some- thing that is fixable. But then there are odors that can range from someone not liking their neighbor’s cooking—but these people chose to live in a multiple dwelling and those are the functional- ities of doing so—to the collection of smells that might come from hoarders or those with lots of animals,” she says. Michael J. Ciarlo, a partner with Man- hattan-based law firm Nadel & Ciarlo, P.C., notes that these are particularly difficult sources of conflict because they are usually between two neighbors, and it becomes a he said/she said situation. “Sometimes it can be resolved by having the offending neighbor install carpeting in their apartment, which is usually already required by the co-op First-time buyers in condo associations, co-ops, and other multifamily residential communities are often surprised—and a bit confused—by the way in which their new building or HOA operates. Whether they are coming from a rental background or a single-family home experience, condo/co- op living, and its administrative and gover- nance structure, differs dramatically from both. In a condo, you can’t depend on the super for everything as you might in a rent- al, nor can you undertake to do whatever you’d like without any prior approval, as you would in a single-family home. Renter Mentality “People who move from single-family homes into multifamily dwellings often have some trouble adapting to their new en- vironment,” says Daniel Wollman, CEO of Gumley Haft, a management firm based in Manhattan. “They don’t realize they are liv- ing in vertical housing, nor do they imme- diately grasp that there are reasons it’s called ‘cooperative living.’ Co-op and condo build- ings have a series of rules and regulations that govern everything from how we live in the building together, to construction or al- terations in our apartments. These rules are intended for everyone to have a fair chance to do the same things in their units as their neighbors, and at the same time preserve peaceful living in a vertical environment. When you live in a private home, you can leave five pairs of shoes outside your front door; you can’t do that outside your apart- ment door.” Also, “At the root of a lot of first-time own- ers’ misconceptions and misunderstandings is a lack of understanding and knowledge about what monthly assessments—also known as common charges or mainte- nance—are for, and what they cover,” says Eric Staszczak, executive vice president for property management with Westward360, a Chicago-based management firm. “People assume that anything and everything they have—including their furniture in the event of a damage event, for example—is the re- sponsibility of the association. They assume the building will take care of everything. But that’s a renter’s mentality.” Removals, Ejections, & Evictions in Condos & Co-ops When an Owner Has to Go BY A. J. SIDRANSKY Dealing With Conflict in Co-ops & Condos Noise, Odors, & Leaks: Oh My! BY KEITH LORIA Orienting New Owners Getting Smart About Condo & Co-op Life BY A. J. SIDRANSKY continued on page 15 continued on page 12