CO-OP / CONDO GADFLIES

"After the dryer incident, I began paying more attention to the board's activities," Howard says. "I came to believe that ours was an entrenched board that was voted in year after year by apathetic shareholders. Our board liked to refer to the co-op members as a 'family.' I came to see that this feel-good metaphor was manipulative and had a dark side: The shareholders were clearly considered the children of the family who were to be seen and not heard."

Howard ran for the board and was elected. Serving for a little over a year now, he has been a gadfly, poking and prodding, asking questions and demanding answers until everyone is probably sick of him. Yet figures such as Howard play important roles in the running of co-ops and condos. They keep boards on their toes — and if dealt with properly, can be a big help to community life.

To Catch a Fief

When Howard got on the board, he came with an agenda and with a chip on his shoulder. He felt that the board was lazy, inept, even corrupt. "In my opinion, the board president ran the board like it was a personal fiefdom and had a great deal of ego invested in it," says Howard. "The president alone decided what would and what would not get onto a board meeting agenda. Board records were sloppy and incomplete. In my opinion, the board had forgotten, if they ever knew, that their primary purpose was to protect the interests of the shareholders."

Such thoughts were natural, but, say experts, Howard would have been a more effective member if he had been a little less direct in expressing his opinions. Who wants to have a Moses on the board, constantly hectoring them about what they're doing wrong? No wonder Howard felt that "from my first day as a board member, I encountered open hostility from management and several board members. The board, following the advice of the managing agent and attorney, made numerous attempts to obstruct any efforts I made on behalf of the shareholders."

I encountered open hostility from

management and board members.

They made numerous attempts

to obstruct any efforts I made

on behalf of the shareholders.

That obstruction was first seen when the newly elected Howard requested past records. "The building was in the midst of an expensive construction project," says Howard, "and I asked to see the contracts pertinent to the construction. I was informed by the managing agent that, according to the attorney, I, as a board member, had no more rights to review these documents than a shareholder." The refusal created unnecessary controversy. "To gain access to the board records, I threatened to sue, and I meant it," recalls Howard. The board backed down.

Once he examined the records, Howard uncovered what he thought was a major scandal: poor work by a contractor and a lack of response by the board. "I discovered that some years earlier a report had been received by the board regarding the $450,000 balcony waterproofing project currently underway. The report stated that the previous $200,000 project to waterproof the balconies five years earlier had been done with improper materials that exacerbated rather than eliminated further leaking.

"When I raised the point at a board meeting, it became clear to me that no board member had ever read the report and that the possibility of a breach of contract claim against the company that used the improper materials had never been considered by the board, the managing agent or the attorney. I have since learned that a breach of contract claim has a six-year statute of limitation; the original work was performed in 2004 and the report was received in 2009. In other words, had the board bothered to read the report when it was received in 2009, they would have been within the six-year statute of limitation."

NYSERDA Nyah-nyah

There were more incidents, such as apparent ignorance that kept the co-op from taking part in an energy- and cost-savings program offered by the New York State Energy and Research Development Agency (NYSERDA); possible election irregularities in the counting of votes; and anger over a newsletter published by Howard that discussed the NYSERDA program. It seemed as if Howard and the board would never be able to work together effectively.

But it can be done. "It's all about being able to work together effectively and making informed decisions," notes attorney Steve Wagner, a partner in Wagner Davis, who is not connected to the building. "You have to find consensus and common ground. Everyone agrees the building should be maintained; how you do it determines what kind of community you're going to be."

To do that, Wagner notes, a board critic may want to focus on what's coming up, not dwell on what came before. Granted, he who forgets the past is destined to repeat it, but he who constantly looks back may end up in a crash. Says Wagner: "If he keeps looking back, he's going to miss the headlights of the truck that is about to run him over — i.e., he may miss the next major issue the building will have."

That said, what lessons could a board and an internal critic like Howard take away from these experiences?

Next page: Getting down to brass tacks, not brass knuckles >>