CO-OP COUP ON E. 96TH STREET

His opposite number, board treasurer, Lars Neubohn, who left the building in 2009 after nine years, called the stormy events a "culture clash" between a relatively new guard that wanted to see services in the building commensurate with the price paid for apartments and an old guard that wanted things to stay the same. "It was crazy," says Neubohn. "It [was] just a mess."

Both sides agree on the outline of what happened: In 2006, the board took out a line of credit to begin a renovation project. Certain measures were critical, such as elevator rehabilitation, shoring up the back of the building and replacing part of the first floor to stop a rodent infestation. Plus, the lobby was due a fresh look.

A Step Too Far

And that last was all it took. For nearly two years, successive boards hemmed and hawed as shareholders argued about whether the lobby needed a full renovation or just a paint job. Neubohn says he was encouraged to run for the board in 2008 by a group of shareholders who were tired of the delays and wanted to see some renovations that reflected their financial investment in the building.

He was elected in May that year with six other board members, who began the arduous task of getting a majority in the building behind a renovation plan.

"The board spent about six months planning, holding meetings, open houses for the shareholders, drawing up plans, beginning the permit process, and interviewing different general contractors," Neubohn recalls. Throughout the second half of 2008, he says, "there were discussions at the board level and discussions in meetings with shareholders — multiple meetings over multiple months — to inform shareholders and get feedback from them."

However, "There was one faction in the building," maybe 25 percent of the owners of the building's 42 units, "that just didn't want to do anything and that we referred to as the 'just paint' crowd," he says.

Nonetheless, the board members were within their rights to start the renovation, Neubohn sats. "There was a clear majority of the board of directors who wanted to undertake the project and the majority of board members voted to approve it, so it went forward."

Dissident shareholders staged an

'impeachment' of the board, even though

the entire shareholder body did not

participate either in print or by proxy.

In October 2008, the board hired a general contractor and put down a deposit. For Greenspan, it was a step too far. Upset in particular over a plan to level the lobby floor for improved wheelchair access, he and a group of shareholders petitioned the board for a special meeting of shareholders to rescind the motion previously passed concerning the infrastructure and pass a new motion to repair only the elevators and do general necessary repairs. In addition, the board would promise to get approval from shareholders for future renovation. If the measures were not approved, the shareholders would vote on removing the board.

Midnight Ride

On January 6, 2009, the board and the dissidents met. For several hours, the differing factions debated the wisdom, scope, and nature of the project — there was "a lot of contention on all sides," recalls Neubohn. The board agreed to the condition set by the dissident group to do just the elevator rehabilitation and the remodeling of the rear of the building. The directors also tabled — with the proviso that they would discuss it in the future — the renovation of the lobby. Then, believing there was nothing more to discuss, the board adjourned the meeting.

But for a group of hard-core shareholders, all of that still wasn't enough. After the meeting adjourned, Greenspan and his fellow shareholders staged an "impeachment" of the sitting board, ousted them and elected a new slate of board members, including Greenspan — even though the entire shareholder body did not get a chance to participate either in print or by proxy.

For Neubohn and his fellow board members, the midnight election was a dangerous farce that not only violated the rules of elections as laid out in the proprietary lease but also drove a wedge further between those who supported the renovation and those who opposed it.

Next Page: The Bloody Outcome >>