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I am on the Board of directors of a large mitchell Lama co-op. Our Management company's real estate lawyer is trying to force out one of our long time commercial lease tenants by raising his rent so high he cant afford it. Our tenant is looking to extend his present lease so that he can get a loan to upgrade the space, however our real estate lawyer wants to double the tenant rent to force him out. This information is not known to the entire Board. Is this legal? The tenant has fallen on hard times, however he pays his rent. He will not be able to afford the increase. This lawyer is also racking up legal fees by calling our attorney asking questions. Is there anything that can be done before its to late for the board to stop it? I need advice on how to approach this matter. What to do when you have information that has not been presented to the entire Board.
Join the Conversation Comments (2)No Lawyer working for a Board should be authorized to do any billable work without explicit Board approval. even as your attorney they should still be required to quote on any project, as to hours potentially involved, and not just the rate for the hours. No Management company should have the authority to initiate any legal work without your approval, it is your money, not theirs, paying the bills. Any work performed for the coop that has not been explicitly approved by the Board I would consider non-payable unless you have given your Management Co. the right to authorize, if so I would rescind it immediately. You have a fiduciary responsibility to your shareholders which includes being diligent as to all spending, planning, commitments and planning.
Deborah, Send an Email outlining all the facts to the whole Board --, this must be written in a non-emotional, business-line manner. And call for a meeting to discuss and resolve the problem.
However, you are running a business, and no matter how you personally feel about this person/business -- you need to make a decision based on the financial welfare of the Coop. So keep an open mind that this may be good for the Coop.
Also, have the Board vote to instruct the Coop Lawyer that he is only allowed to speak with people who have been authorized by the Board. Otherwise, we learned the hard way, you will be hit with outrageous legal
fees.
Good Luck, VP
Thank you. Your advice is very helpful.
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Deborah, Send an Email outlining all the facts to the whole Board --, this must be written in a non-emotional, business-line manner. And call for a meeting to discuss and resolve the problem.
However, you are running a business, and no matter how you personally feel about this person/business -- you need to make a decision based on the financial welfare of the Coop. So keep an open mind that this may be good for the Coop.
Also, have the Board vote to instruct the Coop Lawyer that he is only allowed to speak with people who have been authorized by the Board. Otherwise, we learned the hard way, you will be hit with outrageous legal
fees.
Good Luck, VP
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