New York City and Long Island have a large number of cooperative residences (“Co-op”). Having practiced in this area for many years, the attorneys at Schneider Buchel LLP have become well acquainted with the unique laws that govern Co-ops.
First it is important to know that, unlike Condominiums and a Home Owners Association (“HOA”), when you purchase a unit at a Co-op Building, you are not actually purchasing the Co-op apartment. Instead, you are purchasing stock in the Co-op Corporation and becoming a tenant pursuant to a Proprietary Lease. Essentially you are a tenant, whose rights are governed by the Proprietary Lease and the Co-op Corporation itself in the Landlord. However, as a tenant, you also have shares of stock in the Cooperative Corporation within are attributable to the unit which you purchase and therefore you are considered a shareholder-tenant of a Co-op.
Unlike Condominiums and HOAs, in nearly all Co-op’s you cannot purchase the stock and proprietary lease attributable to the apartment (“Apartment”) without first obtaining the consent of the Co-op’s Board of Directors. You also can usually rent (sublet) your Apartment without the consent of the Co-op’s Board of Directors.
The Co-op’s affairs are governed by the terms of the Co-op’s By-Laws, its Proprietary Lease as well as the New York Business Corporation Law (in many, but not all instances). There are many Co-op’s that are also created under the Private Housing Finance Law (“PHFL”) and Schneider Buchel is familiar with such laws and the specialized needs of communities created thereunder. For example, there are many communities within the five boroughs of New York City that were created under Article II and Article XI of the PHFL and knowledge of the overlapping Federal, State and City rules and procedures are critical to helping these kinds of communities. Schneider Buchel is aware of these complex rules and procedures and has aided many of its City clients on these subjects.
Given that co-ops are a unique form of property ownership (personal property), it is important to engage an attorney who is familiar with representing Co-ops, understands their legal structure, and is intimately familiar with the challenges cooperatives face. Our firm routinely offers innovative solutions to address legal and practical issues presented to Co-ops. The attorneys in our firm have many years of experience in handling any issue which your Co-op could encounter. We serve as general counsel to over 100 community associations.
We regularly draft contracts for repairs and improvements (such as pointing and façade restoration work, roadway projects, roof projects etc.). It is very important that your Co-op involve its attorney when drafting contracts. We have seen many community association boards simply sign proposals which do not give them the insurance and indemnification (among other) protections they require when claims arise.
Financing (and refinancing) is another major issue for Co-ops. Schneider Buchel frequently assists clients with obtaining the financing they need to complete projects as well as refinancing their underlying mortgage. In that regard, most Co-ops have mortgages on their buildings and it is not unusual that they never get paid off. In that regard, most Co-ops have loans that mature well before they are paid off (i.e. – they have a balloon payment). As such, Co-ops must be prepared to refinance their mortgages when they become due . As part of our firm’s commitment to our clients we work with a cooperative’s professional agents, such as bankers, managers, accountants, auditors and others, to provide seamless support that meets the Co-ops needs. Our team realizes that we are not the only experts you are working with and that it is a benefit to you to work hand in hand with your professional team. We have also assisted clients through the formation process, helping them obtain the financing they need for construction or conversion.
Due to the landlord-tenant relationship created by virtue of the cooperative form of ownership, Schneider Buchel handles many Landlord/Tenant matters and has a major presence in the City and Long Island Housing Courts. Schneider Buchel has successfully litigated hundreds of Landlord-Tenant matters over the last decade. Schneider Buchel not only successfully litigated and evicted many unwanted shareholder-tenants on behalf of its Co-op clients, but has obtained some of the largest attorney’s fees awarded in the State in the process. Schneider Buchel frequently obtains payment of legal fees expended so its clients end up not paying any monies for the efforts required to collect the arrears. Indeed, Schneider Buchel has successfully resolved many maintenance arrears matters by having the shareholder-tenant’s lender pay all monies due to the Co-op Schneider Buchel’ s knowledge of this process and the “ins and outs” of the documents that affect Cooperative ownership allow our office to obtain speedy and successful results in arrears and other matters affecting Co-ops.
Our co-op attorneys also frequently advise clients as they are creating and implementing policies (including By-Law provisions, house rules or amendments to the Co-op’s Proprietary Lease) to ensure the cooperative is in compliance with the law. In fact, we have been influential and have guided many of our Co-op Boards on how to amend the governing documents to make their Co-op Buildings including, but not limited to, the inside of the apartments, smoke free!
Schneider Buchel is also regularly appointed by insurance carriers to defend Community Associations in a myriad of different types of matters. Schneider Buchel has successfully litigated and also settled many lawsuits on behalf of many clients as a result of its knowledge and experience in the field of Co-ops. In fact, Schneider Buchel’s practical and insightful approach to litigation matters has led to its appointment by carriers on many complex litigations involving Community Association over the years.
One of the more prevalent issues facing Co-op Boards is how to deal with requests for reasonable accommodations and/or modifications. In fact, a relatively new issue that we have helped our clients address over recent years is resident requests for “comfort” pets and the requests for handicap ramps and parking spaces. We consider our firm as one of the region’s most knowledgeable in this area as we have represented many clients (including defending they claims on behalf of the Co-ops insurance carrier) in such matters. All of our attorneys are experienced in the laws affecting these requests and addressing these issues so as to keep our clients away from liability under the various laws effecting same. Marc H. Schneider, Esq. regularly lectures on the subject of Housing Discrimination. Many of our clients initially sought out our firm to advise them concerning pending discrimination complaints concerning pet-related and other accommodation requests. Knowing these laws (on a Federal, State and local level) and how to handle accommodation requests is critical to avoiding expensive litigation and exposure. We also know how to draft governing documents which comply with the law on reasonable accommodations so these types of disputes become less common. Additionally, we know how to effectively mediate, settle, and litigate such disputes. The attorneys at Schneider Buchel are knowledgeable in this area of law; can provide practical advice to Community Associations on this subject and have successfully defended many of these types of discrimination claims.
Schneider Buchel also frequently attends Board and Community meetings and are proficient at running these meetings efficiently and in a manner that avoids future attack on Board actions, elections and amendments to governing documents.
Our commitment to client service means that we are more than willing to work with a Co-ops other professional agents in order to provide comprehensive representation. We understand we are not the only professionals advising you, so it makes sense for us to work with your professional team rather than asking the board to play “middleman”.
Our attorneys are also adept at dealing with regulatory agencies and code mandates. We stay abreast of this frequently changing area of law so that our clients are aware of regulatory changes before they go into effect, making proactive compliance easier and eliminating the stress that comes with a finding of non-compliance. Our team can help you navigate the regulatory waters, and if necessary, prosecute or defend litigation in the area of the law.
At Schneider Buchel, we are veterans at handling virtually every type of legal issue impacting Co-ops. Our firm offers Co-op clients unique representation that is difficult to find anywhere else. We measure our success by our clients’ satisfaction, often demonstrated by their decision to continue their relationship with us long after the issue that first brought them to us is resolved. If you are searching for a firm to handle a Co-op issue that you are currently faced with, we can help. Call us or fill out a contact form to schedule a consultation today.