Pool's Closed for Summer: But Is It Wise for Shareholders to Withhold Maintenance?

July 7, 2015 — One of the most important amenities a co-op or condo could have is a swimming pool. Nothing beats being able to cool off in one when the humidity feels like it's at 1,000 percent — which is why it's important for boards to make sure it's maintained properly. Unfortunately for residents of one co-op in Port Chester, Westchester, days before the pool was supposed to open for summer, they got a letter from the managing agent letting them know it would remain closed for the season. The problem, they tell Ronda Kaysen in this week's Ask Real Estate column in The New York Times, is that "the board had recently learned about an open permit that would require major modifications to the pool to bring it up to code. [The] co-op's lender does not allow for any open permits on the property." It's really crappy timing, and something the board should have caught sooner. But now that it's happened, shareholders want to know what recourse they have, if any — especially after one shareholder argued that "she should not have to pay her full maintenance" while the pool was out of commission and management responded by saying "it would report her to a collection agency if she did not pay the full amount." What a mess. Kaysen sympathizes with the shareholders but offers some sage advice: "Nothing puts a damper on Fourth of July festivities like a shuttered swimming pool. So I can only imagine how frustrated you and your neighbors must be at the managing agent and the co-op board, which should have seen this coming. But before you tear up your maintenance check, take a deep breath." James W. Glatthaar, a Westchester real estate lawyer, points out that withholding maintenance is misguided and doesn't help solve the problem. Why? Because the co-op needs that money to make the necessary repairs. The sooner the pool is brought up to code, the better, and that requires everyone's cooperation, even if everyone is really disappointed. Glatthaar adds that "most proprietary leases prohibit shareholders from deducting claims against the building from their maintenance. A delinquent shareholder could be declared in default, leading to late fees, legal fees and interest charges and possibly revocation of the proprietary lease." What to do instead? Kaysen recommends that instead of resorting to counterintuitive tactics, the shareholders should "consider a leadership shake-up. Read through the bylaws, which likely include a provision allowing shareholders to remove directors. In this case, shareholders might have a good reason to oust the current roster, especially if neglecting to close out old permits led to the pool closure." It's the smartest — and cheapest — solution.