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Correction: Senate Page Link for Shareholder Bill of RightsAug 30, 2007


Re: SHAREHOLDER BILL OF RIGHTS -(pending in Senate Housing Committee) NOT TO BE CONFUSED WITH Bill #119

Title of Bill: An act to amend the general business law and the real property law, in relation to enactment of a residential cooperative and condominium owner’s bill of rights.

A Must Read !!!

To review Senate Bill #2386 go to: http://public.leginfo.state.ny.us/distsen.cgi

Assembly Bill #5673 (same) go to: http://assembly.state.ny.us/leg/?bn=A05673


Purpose or General Idea of Bill:

Enacts a bill of rights for owners of residential cooperative or condominium units to provide fair and equitable treatment of all shareholders or unit owners; directs the attorney general to promulgate a handbook summary of the rights of shareholders and unit owners vis-a-vis cooperative corporations and condominium associations and the procedures and processes available to shareholders and unit owners to enforce such rights.

On February 5, 2007 Senator Vincent Leibell introduced bill #S2386 where it was referred to the Senate’s Housing, Construction and Community Development Committee.

This same bill #A05673 was also introduced by Brooklyn Assemblymember Vito Lopez, Chairman of the Housing Committee.

Problem:

The bill passed the Assembly vote, passed through the Senate Housing Committee, but at the end of the session, fell apart. Senator John J. Bonacic (Republican), current chair of the Committee on Housing, Construction and Community Development, is opposed to the bill. Major real estate interests are against this bill, citing an impingement on the rights of the board of directors. They feel that shareholders and/or board members would be better served through education.

There is currently a move to create separate bills for coops and condos, since there are different needs for both.


Solution:

For shareholders interested in the passing of the Shareholder Bill of Rights, contact Senator Leibell and Assemblymember Lopez.

Join the Conversation Comments (1)
Internal Server Error on page, so here is copy of Bill S2386 - mhb and pwh Aug 30, 2007


Senate link showed as an error, so here is the Bill in it's entirety.




Legislative Information



Bill No.Approval No.Assembly Cal No.Assembly ResoAsm Rules CalChapter No.Senate Cal No.Senate ResoVeto No.Word Search - BillsWord Search - Resos   2007
Status Text Summary Sponsors Memo
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  Add Alert  S2386 LEIBELL


STATUS:
S2386  LEIBELL             
General Business Law
TITLE....Establishes a residential cooperative and condominium owner's bill of rights



02/05/07
REFERRED TO HOUSING, CONSTRUCTION AND COMMUNITY DEVELOPMENT

SUMMARY:

LEIBELL
Add S352-eeeee, Gen Bus L; amd S339-v, RP L
Enacts a bill of rights for owners of residential cooperative or condominium units to provide fair and equitable treatment of all shareholders or unit owners; directs the attorney general to promulgate a handbook summary of the rights of shareholders and unit owners vis-a-vis cooperative corporations and condominium associations and the procedures and processes available to shareholders and unit owners to enforce such rights.

BILL TEXT:

STATE OF NEW YORK
________________________________________________________________________

2386

2007-2008 Regular Sessions

IN SENATE

February 5, 2007
___________

Introduced by Sen. LEIBELL -- read twice and ordered printed, and when
printed to be committed to the Committee on Housing, Construction and
Community Development

AN ACT to amend the general business law and the real property law, in
relation to enactment of a residential cooperative and condominium
owner's bill of rights

The People of the State of New York, represented in Senate and Assem-
bly, do enact as follows:

1 Section 1. The general business law is amended by adding a new section
2 352-eeeee to read as follows:
3 § 352-eeeee. Residential cooperative and condominium owner's bill of
4 rights. The organizational and operating documents of every residential
5 cooperative housing corporation and every residential condominium asso-
6 ciation established or operating pursuant to the laws of the state shall
7 guarantee the following to each shareholder or unit owner:
8 1. That (a) all applications in connection with matters which require
9 approval of the board of directors or board of managers and (b) all
10 requests for determinations by the board of directors or board of manag-
11 ers including but not limited to requests for the resolution of disputes
12 between or among shareholders or unit owners, disputes between share-
13 holders and the cooperative corporation or between unit owners and the
14 condominium association such as disputes concerning responsibility for
15 repairs shall be processed in a reasonably expeditious manner on a non-
16 discriminatory basis pursuant to uniform procedures and timetables
17 adopted in writing and any such approval shall not be unreasonably with-
18 held. The board's decision shall be in writing and shall set forth the
19 reasons therefor, except that no reason shall be required when approval
20 is granted. A board's refusal to allow a shareholder or unit owner to
21 sublet an apartment pursuant to a uniform policy which is reasonably
22 designed to prohibit or limit subletting shall not be deemed to be an
23 unreasonable withholding of consent pursuant to this subdivision. The

EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07025-01-7

S. 2386 2

1 foregoing provisions of this subdivision shall not prohibit the enforce-
2 ment of uniform reasonable policies related to the health, safety and
3 welfare of the residents and the safe and prudent operation of the prem-
4 ises.
5 2. That elections for members of the board of directors or the board
6 of managers be held by secret ballot, unless waived by a unanimous vote
7 of the shareholders present in person or by proxy at the election meet-
8 ing, or in the case of an uncontested election. A tally of the votes
9 received by each candidate in an election for the board of managers or
10 board of directors shall be posted within one day following the avail-
11 ability of such information in a prominent place accessible to all
12 tenants in each building comprising the cooperative or condominium.
13 3. That the board of directors or board of managers act in a timely
14 fashion to fill any vacancies which occur on such boards.
15 4. That any member of a board of directors or board of managers who is
16 elected while a shareholder or unit owner in the cooperative corporation
17 or condominium association, who sells his or her apartment or the shares
18 allocated thereto, and who, subsequent to such sale shall no longer be a
19 shareholder or unit owner in such corporation or association, shall
20 resign from such board no later than the closing date of such sale.
21 5. That complete and accurate financial statements and any other
22 statements ordinarily provided to shareholders or unit owners be
23 provided in a timely fashion pursuant to established timetables at least
24 once annually. For the purposes of this subdivision "financial state-
25 ments" shall include the balance sheets and statements of income and
26 expense for each of the three most current fiscal years. Attached to
27 said financial statements shall be a statement which discloses (a) any
28 known interest, direct or indirect, beneficial or otherwise, which any
29 director, association member, officer, employee, agent, shareholder or
30 condominium owner or relative of any such person has in any supplier of
31 services or material to said cooperative or condominium and (b) any
32 consideration, financial or otherwise, which said director, association
33 member, officer, employee, agent, shareholder or condominium owner or
34 relative of any such person has received or is receiving from such
35 supplier.
36 6. That the following documents be made available for inspection or
37 copying by shareholders or unit owners at reasonable times on no more
38 than ten days written notice to the board of directors or board of
39 managers:
40 (a) approved minutes of board of directors or board of managers meet-
41 ings, provided that such boards shall have fifteen days from the dates
42 of the meetings at which the minutes are approved to prepare such
43 minutes;
44 (b) agreements and bills for goods and services. All such agreements
45 and bills shall fully describe the goods provided or services performed
46 and apportion the total cost for specific goods or services;
47 (c) banking account and financial investment statements;
48 (d) vendor lists and competitive bidding submissions;
49 (e) reports of accountants, consultants and experts retained or hired
50 to perform services for or on behalf of the corporation or association
51 including financial statements as defined in subdivision five of this
52 section provided, however, that such reports may be withheld where the
53 report concerns or may concern litigation, where the report was prepared
54 in connection with the litigation and where a majority of the members of
55 the board have voted to withhold such information. Where the matter
56 concerns alleged conflict of interest or malfeasance involving board

S. 2386 3

1 members the report may be withheld only upon a vote of the majority of
2 disinterested board members. If all board members are interested parties
3 the report may not be withheld; and
4 (f) reports by municipal and/or county inspectors concerning compli-
5 ance with health, building and housing codes and regulations.
6 7. That in addition to any other notice required by the cooperative
7 corporation's or condominium association's organizational or operating
8 documents, notice of all board and shareholder or unit owner meetings be
9 posted in a prominent place accessible to all shareholders and unit
10 owners in each building comprising the cooperative or condominium.
11 8. That the board of directors or board of managers shall not impose
12 special assessments, or enter into contracts for extraordinary expenses
13 beyond customary operating or maintenance costs, without approval by a
14 vote of the shareholders or unit owners. A vote of the shareholders or
15 unit owners may be waived by the board in the case of (a) an emergency
16 evidenced by an approved resolution of the board, (b) a required refi-
17 nancing of an existing mortgage or (c) where shareholders or unit owners
18 have been notified of the proposed action in writing within a reasonable
19 period of time prior to the proposed date of implementation of the
20 action and where such notice provides that the board may waive a vote
21 unless at least a certain percent of the shareholders or unit owners
22 demand in writing that the action be put to a vote. Such percentage may
23 not exceed fifty percent.
24 § 2. Subdivision 1 of section 339-v of the real property law is
25 amended by adding a new paragraph (k) to read as follows:
26 (k) That a member of the board of managers who is elected to fill a
27 vacancy, unless elected by a general vote of the unit owners, shall hold
28 office until the next meeting of unit owners at which the election of a
29 member or members of the board of managers is in the regular order of
30 business, and until his or her successor has been elected and qualified.
31 § 3. Within 6 months of the effective date of this act the attorney
32 general shall promulgate a handbook summarizing the rights of sharehold-
33 ers and unit owners vis-a-vis cooperative corporations and condominium
34 associations and the procedures and processes available to shareholders
35 and unit owners to enforce such rights.
36 § 4. This act shall take effect immediately; provided, however, that
37 as to residential cooperative housing corporations and residential
38 condominium associations existing and operating as such on the effective
39 date of this act the boards of directors of such corporations and the
40 boards of managers of such associations shall within 1 year of the
41 effective date of this act take all steps necessary to amend the appro-
42 priate organizational and operating documents of such corporations or
43 associations to implement the provisions of this act.

SPONSORS MEMO:
NEW YORK STATE SENATE
INTRODUCER'S MEMORANDUM IN SUPPORT
submitted in accordance with Senate Rule VI. Sec 1
 
BILL NUMBER: S2386

SPONSOR: LEIBELL             
 
TITLE OF BILL:
An act to amend the general business law and the real property law, in
relation to enactment of a residential cooperative and condominium
owner's bill of rights

 
PURPOSE OR GENERAL IDEA OF BILL:
The purpose of this bill is to clarify the rights and responsibilities
of shareholders and boards of directors of cooperative corporations,
unit owners and boards of managers of condominium associations.

 
SUMMARY OF SPECIFIC PROVISIONS:
This bill would add a new section 352-eeeee to the general business law,
to require the board association of cooperatives and condominiums to:

1. Process requests for action in an expeditious, non-discriminatory
fashion, according to uniform written procedures;

2. Hold elections by secret ballot and post election results;

3. Fill vacancies in a timely fashion;

4. Provide for the resignation of members of the board if the person is
selling their interest in the corporation or association;

5. Provide financial statements to all owners in a timely fashion, on at
least an annual basis; such statement must include information on
member's financial interest in any company providing goods or services
to the corporation or association;

6. Make various documents available to all owners for inspection;

7. Post notice of meetings at least ten days prior to the meeting;

8. Notify, and in some cases seek approval from, owners before imposing
special assessments or entering into contracts for extraordinary
expenses; and

9. Provide owners with written procedures for requesting timely determi-
nation by the board or association of disputes.

Additionally, the bill would also amend section 339-v of the real prop-
erty law to require that board members chosen to fill vacancies must
stand for election at the next meeting of unit owners where elections
are scheduled.

This bill would also amend the unconsolidated laws to require the Attor-
ney General and the Department of Law, within six months of the effec-
tive date of this act, to issue a handbook describing rights of owners
vis-a-vis their board or association.

 
JUSTIFICATION:
Boards of directors of cooperative corporations and boards of managers
of condominium associations exercise broad authority over the rights and
financial interests of individual property owners.


Presently these boards and associations possess are given broad legal
discretion under the law.

This bill would establish a number of important due process rights for
individual property owners in dealing with their board or association
and also create general standards for the conduct of business by these
boards or associations.

While most boards and associations perform admirably in managing their
buildings' affairs, there have been reports of abuses. Complaints have
been received from property owners who feel that they have been dealt
with in an arbitrary and capricious manner by the board or association.
The protection incorporated in this bill would help to ensure that prop-
erty owners are dealt with fairly and have access to important informa-
tion regarding the management of the buildings which constitute their
homes.

 
PRIOR LEGISLATIVE HISTORY:
2006 - 4766 - Referred to the Rules Committee

 
FISCAL IMPLICATIONS:
Minimal cost to Attorney General and the Department of Law for printing
and distributing handbook.

 
EFFECTIVE DATE:
This act would take effect immediately, and existing boards would have
one year to come into compliance.


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