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Habitat Magazine Business of Management 2021

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Annual Shareholder Meeting inclusiveness and access - slm Jul 14, 2021

The purpose of this correspondence is to request how to provide an opportunity for all co-op shareholders to be included in the annual meeting.
The problem is many of our shareholders do not have access to technology nor the skills and therefore will not be able to participate in the voting process.
The meeting is virtual and reasonable accommodations have not been made to resolve this situation.
Most importantly, I would like to know if there is any liability for the cooperative not to provide accessibility for its shareholders.
If you have encountered a similar situation please share how it was resolved.

Thank you.

> Join the conversation Comments (2)

We just had our virtual zoom annual meeting .

So your management company should supply all the shareholders with the zoom info and/or dial in number to participate. They can also slip that info under shareholders doors. If anyone doesn’t have a computer or know how to work Zoom they can just call in and listen.

The Zoom will be recorded and notes/mini will be sent out a few days afterwards.

Also what about having shareholders who know how to work zoom have maybe a few in their apartment if they want to view it too but calling in is good too without viewing.

Regarding voting… have all shareholders send their bios to the management company if they want to run and give a deadline and no one will be nominated the day of. Have all proxies sent to the management company via email or fax or there can be a box in the basement near the super (locked) and your managing agent comes and collects those. So your management company has multiple ways of getting proxies.


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We accommodated everyone in our annual meeting via Zoom last month in the following way:

(1) Zoom has an option to dial in by phone, which allows both listening and talking during the meeting. This avoids any use of technology beyond a simple telephone, if that's all the shareholder is comfortable with.

(2) We required that all ballots be submitted in advance, no later than 30 minutes before the start of the meeting. To assist people, we put together a Voter Guide with short write-ups by each candidate. The guide and all the meeting materials were sent to all shareholders both by email and by regular mail - again ensuring that even low-tech residents had access to everything.

(3) Ballots could be submitted by email to our managing agent, either scanned or photographed. The managing agent also came by the building one day before the meeting to pick up paper ballots from those who wanted to do it that way.

All of this went over well with the shareholders. Everyone was fully aware of what was going on, and could vote and participate in a convenient manner, regardless of their technical skills.

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Eviction notice/letter - Pooh Jul 13, 2021

I wanted to ask your thoughts on this…
A few years ago our co-op attorney sent a letter basically an eviction notice to one of our tenants. The co-op owned a few apartments. The letter was not signed by the attorney and instead he listed himself as DIrector of the co-op. The tenants showed it to other residents/shareholders and we were upset and embarrassed. The couple was expecting a baby -7 months pregnant. Also they were the grandchild of one of our board of directors. He was on the board for quite awhile. He was so upset. It didn’t work of course but the it was mean and not necessary. It was done behind the board member’s back. All they had to do was ask him to sign the lease or ask the board member if his grandson was renewing the lease. The management company was shocked when they found out it was his grandson. The young couple forgot to sign the lease. I also thought it was so inappropriate and unethical the way the attorney basically went around it. It was a white piece of paper and not his law firm affiliated to it to really make it official. I think it was a scare tactic and totally unnecessary.

> Join the conversation Comments (2)

You need to more carefully define what is going on, and what you want from us?
What do you mean by a tenant? Does the Coop own apartments that are rented out? Sounds like the attorney acted out of turn. Nothing like this should be done without the board pres and the rest of the board controlling what is happening.

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I completely agree with Grant. This requires a huge dose of specificity and clarity.

If this happened "a few years ago", why are you bringing it up now?

Were the young couple shareholders or renters? I'm assuming they were renters if they had to renew their lease. Who owns the apartment they occupy?

One last question. If this happened a few years ago and the young couple's board-member grandfather was shocked, the managing agent was shocked, and the other shareholders were shocked, why is the director/attorney still on the board?

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> Join the conversation Comments (1)

Guys
I just wanted your opinion on this situation — meaning the way the attorney acted.

He’s still our attorney and I don’t like the way he operates. The President of the board and other board members knew at the time but to me it was wrong and mean and if the tenant who was pregnant would of been stressed out and something would of happened to her that would of been a big problem for us. All they needed to do was ask the tenants and/or grandfather on the board if they were going to renew.

I feel a lot of times co-op boards and attorneys don’t think things thru and act on emotion. They should be problem solvers and not always looking to get someone.

It’s interesting when someone wants to run for the board they’re all nice and then when they’re on then it’s a power kick!!!

At my particular co—op it’s more who doesn’t like who which is not how to run a business.

Yes the co-op owned a few apartments that we rented out.

This is the same attorney who told me that if I didn’t sign the code of conduct then I couldn’t be on the board and it was the night I got in. I should of also reviewed the document and given my feedback and also considering the President of the board already reported someone to the attorney.

My job doesn’t act like this!


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No Shareholder Meeting in Two Years - J Jul 08, 2021

What steps should a shareholder take when there has been no shareholders meeting in two years? We moved into a co-op in 2019 and there has been no annual shareholders meeting or any kind of meeting. No communication at all from the board or management.

> Join the conversation Comments (1)

You should email the Board and your management company. It’s probably in your by-laws that you should have one each year and even with COVID they can do it virtual with Zoom.

I’m assuming the President of the board or someone on the board sends out emails on occasion.

Also what about your financial report? Have you received those though? They need to speak on the report and also shareholders should be able to ask questions.

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Nobody ever responds to my emails. Yes i did receive the financial report but it was never spoke about. I cant stand this management company. Seems very shady. Got a feeling somebody on the board has to be getting a kickback because this company is terrible. Our security system keeps failing and these morons have the parking lot and entrances to the building on the same system so now the parking is always open and the front gate is open. None of the shareholders seem to care.

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> Join the conversation Comments (2)

Look at your by laws . It has to state that you have one each year. What about an election ? You can call a special meeting/election. Contact the President of your management company either by phone or send them an email. Also knock on the President’s door of your co-op about this. Contact the security system company as to why it keeps failing? I don’t understand why co-op’s have email addresses and tell shareholders to send any concerns but they don’t answer.

You might have to also run for the board and make changes.

Is the board the same people or shareholders join once in awhile? Same people on the board for a long time to me is bad. No new ideas.

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Is your board of directors providing a conflict of interest report listing a kickback from the managing agent? Or a report with no conflicts of interest? Or just ignoring this requirement altogether (if so, you can add it to your list of things to harass them about).

https://www.nysenate.gov/legislation/laws/BSC/727

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THREATS AND ATTACK: WHEN BOARD MEMBERS FACE DANGER AND VIOLENCE - Board of Director Jul 06, 2021

What can a HDFC/Co-op do to safeguard the Board of Directors from threats and assaults of shareholders who are enraged not because of something the individual did but because of something the co-op/board did but assaulted the Board Member for carrying out their elected duties. The surveillance video shows/confirms that the attack was unprovoked, and the blow was sustained while the Board Member had her back towards the male shareholder.

The shareholder assaulted a Board Member with bodily harm where the member was knocked unconscious, broken nose, black eyes, dizziness, surgery on nose, delay in speech and anxiety and traumas. Police issued a warrant for arrest of the shareholder(perpetrator) for a felony 1st-degree assault charge; however, he is still at large.

Can the Co-op have rules/protocols/procedures in place such as offer $2000 in reward money for information leading to the arrest and indictment of a shareholders who assaults a Board Member who was performing their elected duties and the termination of the perpetrator's proprietary lease?

What can the Co-op do to ensure that its elected official are protected from violet acts while performing their elected duties?

Also, is the Co-op liable because this shareholder who assaulted the Board Member had been a nuisance 100 days prior to the assault? How should the Board Member be compensated for their pain and suffering, loss of wages and the bodily injures?

Any assistance relating to this matter will be greatly appreciated. Thank you in advance.

Board of Director Member

> Join the conversation Comments (2)

Hi BoD Member - Just a general comment. The situations you describe and the answers you are seeking are way beyond what anyone on this list would want to respond to. It sounds like law enforcement is already involved and you need to let them do what they're supposed to.

I am not familiar with the HDFC governance structure and I'm assuming your co-op has an attorney of record. At the very least I feel your board needs to consult with the co-op's attorney for the answers to the other questions and issues you raise. I'm surprised this hasn't already been done, but if you're asking on here I take it your attorney has not been notified or become involved.

What you should *not* do is take matters into your own hands, offer rewards, take punitive action against the perpetrator shareholder, etc. At best you'll complicate the legal process for dealing with the shareholder, and at worst you'll cause the situation to escalate into something very ugly.

I wish you success in dealing with these problems, but you should not be looking for free advice because it will only be worth what you pay for it. Get professionals involve if you haven't already done so, for everyone's sake.

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Why haven't the police been called? You have it on tape the board member was hospitalized..The person who assaulted this shareholder/board member should have been arrested. Also you need an order of protection on this person and have a lawyer proceed to remove this person permanently from the building.
This is common sense 101. Best of Luck

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Appointed director? - Pooh Jul 05, 2021

Is it common practice that a co-op attorney is appointed as a director/board of director too?

Wouldn’t that be a conflict?

Also is it appropriate for the attorney to use the director title when it works for him?

One time he sent a letter to someone in our building and didn’t sign it besides listing himself as the director of co-op and not attorney..,,why if he’s our attorney?

I know the board members were OK with this but to me its odd.

> Join the conversation Comments (1)

I don't like the idea of the co-op's attorney of record being on the Board of Directors. If this person is also a shareholder, there's an obvious conflict of interest. How do you plan to move forward with legal action against this shareholder if a problem arises? And even if the attorney/director is not a shareholder, it's still problematic. They'd need to recuse themselves from voting on whether to engage their services. Otherwise, there's a business conflict of interest. "Do we need to replace light bulbs that burn out? Better call the co-op's attorney for a consultation!"

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> Join the conversation Comments (2)

Have you ever heard of this before though?

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He’s a non voting board member but I still think it’s odd and to me inappropriate.

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I fully agree with Carl from my own experience. For a number of years, one of our board members was also the co-op's attorney of record. This was done in the guise of "saving the co-op money".

On occasion, this caused serious disagreements between he and I due to his conflict of interest. As a board member he had a fiduciary responsibility to the Co-op Corp and its shareholders. But as the co-op's "attorney" he would render legal opinions that favored his side of a disagreement, even when demonstrably wrong. It was uncomfortable and messy.

I'm not sure I understand the significance of being a "non-voting board member". If he can't vote, what is he purpose on the board?

Your co-op's attorney should be completely independent of any connections to the Co-op. He should not be a board member voting or otherwise, he should not be a shareholder, he should not have any family relationship to a shareholder, nothing.

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It’s so bizarre because I grew up in a house and work in NYC and just can’t believe all the made up rules/situations. It’s all so loosey goosey. You have people on a board who know nothing about a building and especially the structure and they make decisions.

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A common practice for practicality. He can sign documents for convenience sake when sending them on a round trip to the Board is a waste of time and energy.

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I still don’t like that. It’s our home and we need to control it and the President or VP should sign documents.

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Yes, it's almost like real life! In business you think every board director knows all about structures or anything else about running a company? That's why it's useful to have an engineer on the board if possible to bring some experience to the table.

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Unfortunately what I see is that they don’t know anything and think they do and make expensive mistakes.

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Legal tools for handling sponsor/property management problems? - Blocked in the Bronx Jun 28, 2021

My coop experience has unfortunately been horrible.

Our sponsor has maintained control over the building for decades. She has full influence over the property manager, and our board is packed with her picks. She and the property manager illegally cancelled the building election three years ago, and we haven't had one since. Their excuse is quarantine.

Among other issues, I was assaulted by one of her tenants - who has since moved out. No security camera was installed in the area where the attack occurred (and the board has refused to install one since.)

I have no doubt this individual has a record, and would like to at least present that information as proof the sponsor DOES NOT do due diligence re: who she rents to. Unfortunately, I'm disabled and on a strict budget. Are there ANY tools or contacts that would be of use to me? Thanks!

> Join the conversation Comments (1)

Hello

So sorry.

I actually called the NY State Attorney General office about a situation in my co-op and was able to speak to someone that was so helpful. His name was George. 1-800-771-7755. I think it’s #3 to speak to someone so listen to each section. They will give you numbers and info on who and what depts to call but start here first and tell them your situation.

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Speaking about documents without seeing them - Pooh Jun 25, 2021

I wanted to ask about this part of the annual meeting where we vote for officers..I had mentioned that I felt ambushed when asked to sign a code of ethics and if I don’t then I’m off the board and didn’t know ahead of time but others new on the board since I was new. Why didn’t the attorney have the document or even other’s documents that they wanted me to sign sent to the board members so we can discuss it?

He also mentioned something about him and someone in our management company to be officers…something like that and again didn’t have the documents in front.

Also he said a code of ethics is has more power than an NDA. Is that true?

> Join the conversation Comments (2)

An article in the latest issue of The Cooperator has a number of questions posed by shareholders concerning tainted or questionable elections, and responses from attorneys. You may find something that is on point for your issues or close to it.

https://cooperatornews.com/article/qa-tainted-elections

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Thank you but how would you feel if that happened to you? Also during the meeting the attorney was rude and disrespectful and I’m an owner but during the actual annual meeting he was so nice. Would you think it was shady considering all the other board members knew about this document? There is a click. Who’s going to join the board now. So if you burp the wrong way and someone doesn’t like you on the board like the President they’ll contact the attorney. I spoke to the management company (President) and I told him how unprofessional and shady it was and how I felt and then I told him I’m no longer going to serve on the board. I also showed the document to a few people and they said they wouldn’t sign it either. I told a few shareholders because they congratulated me and then I told them I’m not joining and they were upset.

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remember the shareholders vote and elect the Board, not the other members of the board. So only the shareholders can remove a Board member before their term is up.

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> Join the conversation Comments (2)

Thank you but the attorney said if I didn’t sign the document I can’t be on the board.
I felt like I was being bullied.

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You can ask the attorney under what authority you can be denied your place on the board if you don't sign the document, but if you're not an attorney yourself it's a spitting contest you'll probably lose. If you ask, do so in writing and request he also replies in writing.

I see two options: speak to your own attorney, or contact the Attorney General's office, advise them of the situation, and ask them for help

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> Join the conversation Comments (2)

Do you do this in your co-op?

Who’s going to join the board with all this nonsense. My job doesn’t even do this.

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It's a huge investment for you. Are you going to let someone else run down the quality of life and the resale value?
If so, what do you expect us to do?

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If you and the other shareholders choose not to do anything you've effectively ceded the outcome to the incumbent board.

In answer to your question about who's going to join the board with all the nonsense, the answer is simple. Organize the rest of the shareholders so a slate of board candidates you put up receives a majority of shareholder votes. Old board is out, new board is in, nonsense is gone.

I said the answer is simple, not easy. You'll have to really work to overcome natural inertia and the tendency to avoid confrontation. You may not get a majority to support your position and at best elect only one or two new board members. You may need to go to an outside attorney and that will cost money. Only you can decide how much pain you're willing to endure, and if it is so much you'd rather throw in the towel.

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I actually told the mgmt company that I’m not joining the board. Someone else joined and she’s actually a good person BUT I’m sure the shareholders are wondering why I decided to do that 2 days later. An email went out already.

Oh the President reported someone already and that’s why he didn’t run again .
I can’t be in the same space as her. It’s a team effort and a woman who worked in a completely different industry has no clue about the structure of a building. I do think she’s afraid of me because i confront her when she lies.

I started letting shareholders know already and they were upset and to me the Board loses credibility doing shady things right off the bat.

I will check her and the attorney. I’m the client and his click with her is unprofessional.

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If other shareholders are upset over shady board actions it should be much easier for you to organize the shareholders and get a friendly slate of candidates elected.

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I definitely was upset on the disrespect from the attorney to an owner. He works for me/co op. I think if it was presented better and more like…please don’t get offended but we feel this is something we should have in place and all board members will be signing this…

The other board members knew about the document because its a click and the fact the President already ratted someone out isn’t good. we have a board member who was subletting illegally until he was approached…who’s going to take the board seriously.

We if I would of known about this document I wouldn’t of run.

We’ll have to change next year.

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Code of conduct document - Pooh Jun 23, 2021

I was voted on the board and found out during the meeting at the end that there’s a code of conduit document and I have to sign it or I’m off the board. I never knew about this or else I would of never run. I was so upset. Is this legal? I don’t know anyone that lives in a co-op that does this. I felt ambushed.

> Join the conversation Comments (1)

I would feel ambushed too. I assume you've had a chance to review the document and you don't agree with it. If you were duly elected by a shareholder vote I don't think the board has the power to arbitrarily throw you off. You might have to contact an attorney about this. Also, check your Bylaws. That document provides the rules under which the board can conduct itself. It should contain a section describing the conditions for board member removal.

If you want to push back, the first thing I would do is ask for copies of the CoC documents signed by every other board member. See if everyone is in the same boat or if you're rowing by yourself. If you get the copies, hang onto them. If you're refused, don't sign anything either. I believe you're still a board member. You may have to contact the Attorney General's office for help.

You'll have to decide if you can live with the CoC. If you can, fine. If not, you may need to talk to an attorney because co-op corporations and their boards are controlled by NYS and NYC laws and regulations.

Good luck!

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The others will sign too but they’re on the board and knew about the document already. It wasn’t even an official document because it was a blank white piece of paper and cut and paste and no date or co-op heading name. It also states in the second half that as a board member I can’t contact our management company or a vendor and I have to go through the President. Obviously the President is insecure that I’m going to out shine her. Who’s going to join the board now with this stupid document.

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rules/laws re:sponsor's sale - DP Jun 23, 2021

Are there different rules/laws for selling apartments in a coop, based on whether you're an owner or the sponsor
—laws controlling who the SPONSOR is allowed to sell to (especially when he's trying to disengage from the building)?

We are trying to accomplish more owner-occupied units in our coop and do NOT want investors. The sponsor knows this, and yet...

He sold one of his units to another investor. That investor never lived in the building, and immediately rented it to a family who already lived here but was looking to move within the building. That tenant moved out within a short time (year or two) and the apartment is now rented to yet another person.

Thank you.

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We have sponsored units in our building and little by little they sell them. We don’t have a lot at this point. Once the sponsor sells them then the buyer becomes a shareholder and has to follow the rules. They can’t rent out their unit aka sublet until after a certain time. You should contact your management company and co-op attorney because something doesn’t make sense or maybe with us we don’t allow investors and that’s why we don’t have that problem. Did you also check your bylaws?

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Be proactive or people will take advantage

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Communication from the Board to all shareholders/residents - Pooh Jun 22, 2021

Is it appropriate for the President of the board to send out emails using their name and not ending it “Your Co-op Board” or something like that?

In our co-op the President sends out random emails and doesn’t even let the board give input and some are long with lots of details.

How is that a team besides that quite a few times the emails were hostile and disrespectful.

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you cannot restrict his sending out info on a sheet of paper.
Have a conversation and tell him of the concerns of the rest of the board.
A board member you cannot work with should be voted off the board. Campaign; you are in politics!

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Does the president try to make it sound as if the emails represent the entire board, or is it clear from the context that the emails are the opinion of the president individually?

If the former, at the next board meeting you should vote to require a majority board approval of anything being sent by individual board members. If the president continues to defy the board's vote, it should be easier to remove the president or any board member who behaves badly.

If the latter, the board should inform the president that if they persist in sending out emails to shareholders that do not represent the majority of the board, the rest of the board will send out their own email expressing the views of the rest of the board.

The way we deal with individual vs board emails is, if the email would reasonably originate with an individual board member, such as the treasurer sending out something to do with co-op finances, the board approves the text and the email goes out in the name of the treasurer only.

If the email expresses a full board opinion or vote, then the email is signed by the individual writing it, and indicates board concurrence, like this:

--- Steven424, for the board.

Either way, remember that no individual board member is above the will of the board.

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They send communication as if it’s just from them and not the team. This person doesn’t understand what a team is.

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