Condominium board members: Wake up and smell the legalese of Pomerance v McGrath. This recent court ruling allows condo unit-owners to do what co-op shareholders have been allowed to do for a while: review monthly financial statements, board minutes, receipts, invoices, and legal documents, then make hard copies and take them out of the management office.
“Unit-owners and shareholders have the right to inform themselves, but that doesn’t mean that they can involve themselves in day-to-day management,” observes attorney Jesse Schwartz of Kagan Lubic Lepper Finkelstein & Gold, who represented the condo board in Pomerance v McGrath. “We were concerned about the possibility of unit-owners who want to inspect documents to hurt the condominium or the board.”
There are some restrictions in place to prevent that: legal documents may be redacted to protect client confidentiality, and boards can require an information seeker to sign a confidentially agreement. In addition, the person demanding copies of such records has to demonstrate good faith and a legitimate purpose.
The court held that unit-owners have the “right to examine these records at the managing agent’s office during convenient weekday hours” and also had “the right to create paper copies or electronic copies at [their] own expense during [the] inspection.”
“This is an important decision,” says attorney Peter Livingston, a partner at Anderson Kill. “It enhances the power of owners.”