You should get a lawyer's opinion if you plan to contest the election, especially since you're asking two separate questions.

(1) Can people be prohibited from running for the board if they are in arrears? The answer is Yes, but this must be stated in the by-laws. In fact, we have a clause precisely along those lines in our own by-laws: "No one shall be a candidate for the Board if he or she is more than one month in arrears in paying maintenance or assessments." Since you say there's no such clause in your by-laws, then it probably wasn't legitimate to exclude such people as candidates. But there's probably not much point in contesting this issue: before the next election, the board will just vote to amend the by-laws, which typically does not require a shareholder vote.

(2) Can shareholders who are in arrears be barred from voting their shares? I'm almost certain the answer is No. This would appear to be a direct violation of NY Business Corporation Law (BCL) Sec. 501(c), which requires that "each share shall be equal to every other share of the same class." As long as the shareholder is still the owner of the shares, the coop cannot legally prevent the shares from being voted. It doesn't matter what the by-laws say; a coop's governing documents can't override state law.

I'm not a lawyer, and you should certainly contact one if you want to move forward on this.

A bit of Googling turned up a recent ruling on this issue: Summer v. Ruckus 85 Corp (July 13, 2012). As expected, a co-op cannot deprive a shareholder of voting rights for being in arrears, even if it says so in the by-laws. Here's a quote from the decision, which references a ruling from 1979 (Yu v. Linton):

"In a similar case where the corporation disqualified a shareholder from voting at the annual meeting for failure to pay maintenance expense, the First Department held that '[T]he bylaws are ineffective to deprive the record shareholders of the right to vote provided by Business Corporation Law, s 612(a).'"

Interestingly, Sec. 612(a) allows one exception: "... unless otherwise provided in the certificate of incorporation." But it's profoundly unlikely that your coop's certificate of incorporation provides for any monkeying with standard voting procedures, and might run afoul of other sections of the BCL even if it did.

In short, even an amendment to the by-laws can't prevent a shareholder in arrears from voting. Here's a link to the full decision:

http://statecasefiles.justia.com/documents/new-york/other-courts/2012-ny-slip-op-31889-u.pdf?ts=1343056947

What if a shareholder is in Foreclosure and also not paying maintenance?

I'm not an attorney, but I believe as long as a shareholder is technically the owner of the unit and has not been foreclosed on, he/she is eligible to vote in an election. However, you should consult an experienced attorney for definitive guidance.

It appears that there's an easy way around this. The lease states that the storage space is furnished "under a revocable license." The board should say that all licenses will be revoked unless the lease is amended to allow the coop to charge for use of storage space. This should be done in a straightforward, common-sense manner: "Given our ever-rising costs and the high premium on storage space in New York City, the coop cannot afford to offer this amenity at no charge. We must either charge for storage space - which will require a supermajority vote of shareholders to amend the Proprietary Lease - or we must convert the area presently used for storage to another use." Done properly, this should ruffle no feathers except those of the people who thought they'd found a sly trick to get free storage lockers forever.

As for bike storage, the same "amend it or lose it" approach would work, but bicycle storage is less space-intensive. In our building, we charge for lockers but offer free bike storage since much less space is involved per person. We're not stuck with a "furnished gratuitously" clause so that works fine for us.

In my co-op, we try to reach consensus. This means creating an environment where everyone is respected and feels safe to say their piece. And I, as President, need to have the inner self-esteem to hear criticisms of my own role on occasion.

For us, voting by e-mail is a necessity however all board members are copied and the main discussion occurs with a “reply to all”. However, one cannot control what conversations occur on the sidelines, even in a board meeting.

Regarding the President who lives somewhere else, I cannot see how they can lead well. I need to perform occasional walkthroughs so I can see, with the perspective of a buyer usually, what needs to be repaired or improved. I need to hear what the shareholders are saying too.

I suggest that for the welfare of the shareholders that they resign or someone else voted in as President.

Good luck,

Steve

In reference to your board voting by email, have your by-laws been amended to explicitly allow a board vote by email? If so, would you share the language?

If there is no language in your by-laws explicitly allowing a board vote by email, then aren't you in technical violation of the by-laws? This has been our concern.

An alternative solution we take advantage of is the conference call. We have found that there are many free conference call services available on the internet that work very well. As you know, in a conference call everyone can hear and be heard in real time, which seems to be the requirement in our by-laws for a board meeting to take place.

Although we discuss via email and may reach a consensus that way, voting by email seems to be voting without actually having called a meeting to order. We have been advised that voting ourside of an actual board meeting would violate our by-laws and possibly state law, which would place us in jeopardy of being in breach of our duties.

Any thoughts would be appreciated.

Hi,

We have 9 Board Members. I usually wait until 6 members reply in the affirmative (excluding myself) before taking action that way we avoid questions of quorum. Sometimes the e-mail conversation indicates that more discussion is necessary on the topic and then the issue is tabled until the next Board meeting. Our goal on votes is consensus although we don’t always get it.

Our bylaws allow for the use of an executive committee to act between meetings.

Our Board also has power to change the By-laws (which can be overruled by the Shareholders at the next annual meeting although that has not happened). Our Board has only changed the By-laws once to my memory. That was to enable the ousting of a member who did not show up for three meetings. We have never yet used that clause.

Steve

Tim:
Your vote should be ratified at the next meeting, and then recorded in the minutes as an agenda item of that meeting. The agenda for that meeting can read simply: ratification of telephone vote (mention subject). I hope this helps.

Do your bylaws have a clause like this from FRBNY?


SECTION 1. Quorum and Manner of Acting
At all meetings of the Board of Directors (“Board”), a majority of the Directors shall be necessary and sufficient to constitute a quorum for the transaction of business, and action by the Board at a meeting shall be upon vote of a majority of the Directors present at any meeting of the Board at which a quorum is present. Directors participating in a meeting of the Board by means of a conference call, video conference, or such other means that allow for each participant to hear and be heard by each other participant at the same time, shall be deemed to be present at such meeting.

Call the building's insurance company and the tenant's ins company they will work it out among themselves.

Please post the link to the webpage where the new rates are published.

Thanks!

NEW 2013 NYC Real Estate Tax Rates
Here are the tax rates for fiscal year 2013 (7/1/12 – 6/30/13) adopted by the New York City Council at its meeting of November 13, 2012.

Class FY13 Tax Rates

2. (Apartment Buildings) 13.181

http://www.stroock.com/SiteFiles/Pub1256.pdf

Thanks, SD!

seal their doors on all sides with rubber sweeps on the bottom and stripping for the sides - all bought from hardware store. Cheap easy solution.

We did that. It doesn't work too well on the floor where there is carpet to go over. Also, the odors get into the hallway whenever the smoker opens the door to go out.

Hi,

You probably have negative pressure in the building. This happens a lot in restaurants due to the hood ventilation systems which draw air out of the building. In your case, it might be the elevator shafts or other hallway venting. So when the door to the unit is opened, their air rushes into the area of lower pressure – the hallways. (This is another reason why not to take elevators in a fire by the way.)

Talk to a HVAC engineer to see if this is the case and what you can do about it (arrive at a better balance). You may need to replace the seals on the elevator doors. It is hard to tell not knowing more.

Steve
.

We do have airflow into the hallways and have roof exhaust fans in the kitchens and bathrooms. We are trying to get an engineer that knows this topic. Our prior one was a waste of money.

Here's a specific name of an AG enforcement officer in NYC.

http://www.habitatmag.com/Publication-Content/2009/2009-March/Featured-Articles/Negligent-Sponsors-and-the-AG/Negligent-Sponsors-and-the-AG-p.2#.UNIDoonjmJI

And here are 3 more articles that might help

http://www.habitatmag.com/Publication-Content/2012/2012-November/Featured-Articles/Condo-Construction-Defective-What-Steps-to-Take

http://www.habitatmag.com/Publication-Content/2011/2011-November/Featured-Articles/New-Construction-Condo-Problems-Fight-Sponsor

http://www.habitatmag.com/Earlier-Issues/2007-September/Featured-Articles-from-Our-Print-Magazine/Shoddy-Dangerous-New-Construction-Brand-New-Boards-Fight-Back

Hi Nancy - That's a good question. You can obtain the best and most complete answer from your co-op's accountant or auditor. They know the most about your building's specific situation. Ask them, I am sure they will give you the information you are looking for.