In our 500 unit co-op, the doorman (or the office) will only provide phone numbers to board members.

And, no one, not the doorman or the office, will provide the resident’s telephone number to my wife even though she is the spouse of a board member.

Let me ask you this, D&C.

If a board member finds out that the apartment above you has sprung a leak and water is most likely dripping into your apartment, would you prefer for the board to call you right away or to leave a message at the front desk?

Now, even if you, in fact, would prefer to wait until you walk past the front desk and read the message, there will be many shareholders who would demand to know right away. In fact, some of them may threaten to sue the board if their property was in danger and no one informed them right away.

What if you complained to a board member about the insane noise coming from a stereo in the aparment below -- would you be satisfied if she simply left a message at the front desk?

Remember, legally speaking, in a co-op a shareholder is a tennant of the corporation; the corporation is the lease-holder and the board is the landlord.

You will probably find in your co-op by-laws or proprietary lease a clause that says all shareholders are required to provide the secretary (or the mgt co) with their up-to-date contact information.

Most of the time when the board contacts you it's not because your property is in danger. But if the board is taking the trouble to get in touch (remember, board members are volunteers with their own lives who would probably rather be watching Jeopardy! or playing with the children), the reason is probably fairly important.

Steve W

Steve, with all due respect you are missing my point. (or maybe I did not explain myself). Our building staff know how to handle leaks,emergencies, etc and what the protocol is. I am more concerned with confidential issues. Sure it does not help much if a shareholder is in financial difficulty and a board member stops off at the desk and gets the number and calls the shareholder for his/her own self interest.
Now do you see my point.

D&C

Hi, D&C,

I may have missed your exact point, but I don't see much difference.

The fact remains that board members are obligated to have contact information for the shareholders. Whether they get it from the doorman, the super, the managing agent or their own list is immaterial.

If a shareholder owes the corporation money, and is behind in his/her payments, the board has a duty to make sure that money comes in -- they are running your business, after all, and if someone isn't paying her fair share, then you and your neighbors are making up the difference. To me, that's truly unfair.

The only exception to your example depends on what you mean by a board member calling the shareholder for "his/her own self-interest." If the board member is not, in fact, trying to find out when the shareholder will pay her bill, but harassing the shareholder, then yes, the board member has crossed the line.

Otherwise, I would want my board members to aggressively collect arrears. (To put it another way, if you invest in GM and you find out that GM is letting some customers own cars for free, would you want to hold or sell your stock in GM?)

Your Proprietary Lease may indicate otherwise, but it's unlikely.

Steve

I'm with you. No board member should get the telephone number, specially when you have Management. If there is a leak, those affected by the leak should call management for the emergency so that staff may be called. STaff will then report to management or board the problem.

Similarly, a loud stereo is a problem of police or management. A board member should not be dragged to be a policeman for noise, violations, etc. Let it be taken care by management, staff and police if necessary.

A board member can always write a note to the shareholder requesting to be called for the reason explained in the note.

AdC

I agree with you. As I said previously we know very well how to handle emergency situations. We do not drag the shareholders into the situations, give out names, etc. We write up incident reports when such happens and cc: management. It works out really well. As from my previous post, you have answered my question. (I was looking for reassurance to my question/opinion which you have supplied)

D&C (well not any longer)

D&C,

I'm glad I reassured you of your conviction; howerver, thorugh this chatroom, you find opinons that are diverse and may help widen even more the thinking. Don't just get reassurances, but also get point of views. It helps articulate to your own shareholders WHAT TO EXPECT FROM board members, management and counsels.

As BP states, arrears are only taken up by management and counsel. It should be totally out of the hands of the board. One out of 500 shareholders will come to the board to let them know of some financial hardship that the shareholder wishes the board to consider. Although not the most ideal situation, the shareholder may be asking or reaching for advice in their particular case; the shareholder should deserve empathy, frank discussion and knowledge of the shareholder's short range plan so that counsel may be consulted and engaged at the appropriate time.

AdC

Board members can be given owners' telephone numbers, assuming: (1) the Board members are calling on Board business, such as trying to arrange payment of arrearages; and (2) the Board has agreed that the specific Board member is authorized to do so.

Board members are obliged to keep the contact info confidential and should only use it for Board business. Otherwise, telephone numbers should be strictly confidential. If someone wants their neighbor's telephone number, they can use a phone book.

The building's managing agent and/or super should already have keys/contact info in case of emergencies.

Note that our attorney actually recommends that Board members contact owners directly in certain situations (such as arrearages), since being approached by a neighbor/Board member on sensitive issues is more effective, and less threatening, than being approached by the managing agent or the building's attorney. Of course, the Board member should be able to "stick to business."

NSB, I don't agree with your attorney that board members should contact owners on issues such as arrearages. I don't think they should try to resolve arrearages but of course should be aware of them. It should be handled by management and/or their accounting department. Reasons for arrearages are many, and board members can get into a hornet's nest by trying to handle this area of coop biz. It's tough enough keeping board service and friendships (or at least being on good terms with owners) as distinct relationships without getting into direct discussions with them about their personal financial issues.

I agree that at times talking with a board member can be more effective and less threatening than by management or the coop attorney. We have an owner who travels a lot on business. Her three sons (in their 20s) had parties when she's away and "friends" of all ages coming and going at all hours. Residents were afraid to get in the elevators with them because they either looked scary or were stoned blind. Our board VP's known the owner for years, had a talk with her, and said things were escalating and she risked eviction if this didn't stop and he wouldn't be able to help her. She appreciated being approached this way, laid down the law to her sons (but good!) and we haven't seen or heard any funny business in over a year now.

Good board members have to use good judgment, and I think that includes knowing what their duties are, when to get involved with owners and when not to.

BP, I agree with you. NSB, your are paying a management company to "manage" your building. Late fees etc they address, if not successful the attorney is then contacted. I do not understand how someone on the board should be involved.

D&C

As AdC points out, there are many ways to run a business, especially when that business is a co-op.

On our board, the managing agent works hand-in-hand with the board. Together we watch arrears very closely because maintenance fees are more than 96% of our corporation's operating income. When someone stops paying her maintenance, it affects every shareholder: bills keep coming in and we have to pay them; if we're short on cash we have to borrow money; the interest on that borrowed money is payed by every single shareholder.

Income (specifically, cash flow) is important to our co-op, and financial matters are among the most important that any board member oversees.

While board members do not need to be involved at every step of recouping arrears, there is no reason for them to be excluded.

As the treasurer, I examine the monthly statement of accounts closely. When a shareholder is two months behind, I inform the board and instruct the managing agent to send a letter (which says we notice you're behind, if you need extra time please contact the managing agent).

If the shareholder does not respond and does not pay his/her bill, I inform the board. We may then choose to have someone from the board approach the individual, or we may write a letter from the board.

When a shareholder is three months behind, and if she has a mortgage, the board sends a letter informing her that the mortgage contract she signed with the bank obligates us, the board, to inform the bank of arrears equal to or greater than three months. (Banks are not pleased when a customer does not pay her bills -- and one's maintenance is connected to your mortgage, according to the contract you signed.)

With one exception, we have not had to inform a shareholder's bank because shareholders respond to that letter.

As a side note, those shareholders who appreciate a board that holds down costs appreciate this approach because it keeps the lawyers out of the process (and they're not cheap -- we just interviewed a firm that charges $2000 to be an arrears shark for one shareholder; I kid you not).

Perhaps there is a personality clash involved in the case D&C brings up. I can sympathise with that, but the reality is that a co-op is a business; board members have a fiduciary duty to run it in a financially sound way. Some board members have abrasive personalities (we're New Yorkers, after all!), but as long as they're seeking what the corporation is owed, they're acting in the interest of every owner in the building.

Steve W