Ruth Ford in Co-op/Condo Buyers
Under the building's proprietary lease, guests are permitted to stay for up to one month, or longer with permission of the board. No such permission has been sought, says a board member, and the shareholder did not respond to a letter from the board, asking her to stop opening up her apartment to unauthorized guests when she is away from the building.
"The first question is, are these people really social guests or is this a bed-and-breakfast?" says Marc Luxemburg, chairman of the real estate department at the law firm Snow Becker Krauss and president of the Council of New York Cooperatives & Condominiums. "When you have a revolving series of people who roll in and roll out you have to strongly suspect it is being used as a bed-and-breakfast. If it's a financial arrangement, then that's illegal."
One way boards deal with such guest situations is by passing a house rule that says that no guests can come and visit an absent shareholder's apartment unless there is a written explanation from the shareholder. The board then tells the doorman no one gets in otherwise, says Luxemburg, "key or no key."
A doorman or super will often be the board's eyes and ears. When one Manhattan co-op board started wondering whether a shareholder was operating an illegal business, it had the doorman keep a log of all the comings and goings of the guests. After that, it hired a detective, says the board's attorney, Arthur I. Weinstein, a founder and the vice president of the CNYCC. Eventually, the cooperative gathered enough information to know the shareholder was running an accounting business.
What About Roommates?
Under the New York State Real Property Law, a co-op corporation cannot restrict a shareholder from taking a roommate, either a family member or an unrelated person. But restrictions can apply on the number of people in any apartment – and the primary tenant has to reside concurrently in the residence with the roommate.
In any event, make sure to read and understand your proprietary lease, If it controls the length and frequency of guest stays, you might find yourself in breach, and the board can send a notice to cure the breach or threaten eviction. If you argue that the guests are roommates, you "can't use the roommate law in this residence and live in another apartment," notes attorney Mitchell Kossoff, a partner at Kossoff Alper & Unger.
David Berkey, a partner with Gallet Dreyer & Berkey, recommends that boards start with a phone call, reminding you of the month- or however-long guest rule in the proprietary lease. If you don't respond, you'll next likely get a letter from the board or the managing agent, reminding you that the guest is "not an authorized occupant of the apartment." If you still don't respond, the board's final step is to send you and your mortgage-holder a default notice; if the default is not cured, then the board could send a termination notice and proceed to legal eviction "for breaching the lease."
While it may seem intrusive to be asking you who you're letting stay in your apartment, the security of the other residents is the primary reason that a board will seek to stay on top of the situation.
Adapted from Habitat November 2003. For the complete article and more, join our Archive >>
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