Page 5 - New York Cooperator February 2019

QUESTIONS & ANSWERS Legal Q A& Asbestos Request Goes Ignored Q What can be done when a co-op building has pipes in the build- ing that proved to be positive for asbestos, and the building refuses to release the test results to shareholders who are af- fected? Are they entitled to get results ? —Worried Shareholder A “Asbestos is a certainly a serious health issue,” says attorney Slava Hazin of the New York fi rm Warshaw Burstein, LLC, “but it is important to know exactly where the asbestos is located, and its condition. Is the asbestos found in insulation surround- ing the pipes, and what is the condition of the insulation? Have the pipes become so corroded and the insulation so damaged that the asbestos is actually getting into the pipes and into the building’s water sup- ply? According to experts, the mere pres- ence of asbestos is not dangerous unless it is damaged, crumbles (become friable) or becomes airborne – or in this case gets into the building’s water supply. “As a shareholder, you are entitled to get the facts. In the spirit of transparency, the board should have provided shareholders with the test results and, if necessary, a plan for remediation. If the board refuses to do so, Section 624 of the New York Business Corporation Law (BCL), which applies to cooperative corporations, gives sharehold- ers the right, upon giving proper notice, to demand to inspect the corporation’s books and records, including minutes of board meetings. If the board already has the test results, there have to be minutes of board meeting at which this issue was discussed. You should consult with an attorney re- garding making a formal written demand upon the board for copies of all board minutes at which this issue was discussed, along with a copy of any reports prepared for the board, including the test results. “In the event the board refuses to permit you to inspect these documents and make ‘extracts therefrom,’ your counsel can rec- ommend whether appropriate legal action should be taken.” Is It Right to Increase the Price of Our Insurance? Q I’m on the board of a complex of three buildings housing about 282 units. Our insurance com- pany is pressuring the property manager to get us to raise our insurance coverage level to cover the cost of completely rebuilding our buildings. Is this legit? Th ey ask us ev- ery year, and every year we say no. I was wondering what other co-ops do. —Feeling the Pressure A “Yes, this is legitimate,” said Edward J. Mackoul, Presi- dent of Mackoul Risk So- lutions, an insurance fi rm with offi ces in Long Island, Manhattan, and New Jersey. “A number of years ago, insurance com- panies did a survey and felt that a majority of the buildings they insured did not have enough coverage in the event of a total di- saster. “Th ese days, insurance companies can run soft ware based upon a number of factors obtained from their loss con- trol inspection, such as number of stories, construction of the building, number of elevators, etc. Th ey then generate a report that gives them a general idea of what the building should be insured for within 15 percent of the actual replacement cost. If they feel the building is under-insured, they’ll usually make a recommendation to increase the limit to cover the full replace- ment cost. COOPERATOR.COM THE COOPERATOR — FEBRUARY 2019 5 continued on page 21 Energy just got easier NYC customers now have access to our expanded natural gas and electricity pricing programs. Let us help make managing your buildings’ energy easier than ever! Lock in fuel oil, natural gas, and power rates with Sprague, and you could save time and money Learn more about our natural gas and electricity programs - Call today! 1.914.381.6600 | www.spragueenergy.com customercareny@spragueenergy.com Our Energy Makes the Difference ® Manage your energy better with: • Locked-in rates for budget certainty & peace of mind • One point of contact for heating oil, natural gas, & electricity supply • Unmatched electricity pricing through our unique range of supplier relationships • The same quality account management & customer service you’ve come to trust