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We have a shareholder who bought an apartment almost 3 months ago. He hasn't moved in yet because he is doing some renovations. We have a requirement that the apartment must be his primary residence, which it isn't yet. We have an upcoming Annual Meeting at which he may want to join the Board for next year. Technically, he is a shareholder in good standing in that he is up to date on his maintenance but does the fact that this is not yet his primary residence prevent him from being on the Board? Thank you.
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I agree with Steven that the buyer owns the apartment since he closed. However, that doesn't necessarily prove that it's the primary residence. It just means that he bought the apartment.
As Steven suggested, you can ask for a notarized letter. My preferred method of showing primary residence is a driver's license that has your co-op's address on it.
I would ask the buyer to show both the notarized letter and the driver's license. If the buyer presents both items to the Board, then that would satisfy my primary residency criteria.
With all due respect to the gentleman that suggested he would accept a driver's license reflecting the building's address to evidence a "primary residence;" one can visit most any local NYS DMV office--advise them of a change of address--and easily obtain a second driver's license. If one wanted to be exceptionally clever, one could claim that he/she physically lost their driver's license through misplacement--inform them of a different address--and obtain a new driver's license reflecting the building's address. Thus a driver's license with the building address is not exactly the best means in which to accept proof of a primary residence. If the Board can obtain information from a mortgagee (bank lending $ for the loan) that will support whether it is a primary residence of 'second' home (or investment.) But, leaving it to a clever shareholder is ludicrous; no disrespect intended.
No offense taken Throck. You make valid points.
Just some random thoughts
They closed 3 months ago and haven't moved in yet? Are the renovating so they can move in? What were their projected intentions when they purchased and interviewed?
Why is this important if they are intending to be full time residents and just have not moved their bags in yet? It sounds more like you (or someone) wishes to deter him and using this an cause.
If this is true, and in my opinion justifiable since someone should be a resident long enough to understand and know the buildings climate, challenges and characteristics enough to be able to contribute to it, they should be informed directly of the concerns and encouraged to run next year when they are a bit more seasoned.
If the concern is truly that they may be an investor on the board, then possibly state that directly also.. I say all that because it is always best to be upfront with intent and reason as not to cause animosity and a foe down the line. ...
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This is kind of a squishy questions, but from the way you describe it, I would say the new shareholder's apartment can be considered as his primary residence. I assume that the new shareholder closed on the apartment and is now the shareholder of record. Many new shareholders renovate before moving in. This doesn't preclude the apartment from being their primary residence and where they're living now is a temporary domicile.
If you have concerns, ask the new shareholder to provide the board with a notarized letter stating that the apartment is and will be his primary residence. If he turns around and sublets it or uses it as a pied-a-tier, you can always vote him off the board.
If you have serious concerns, ask the board's attorney if the new shareholder qualifies for board membership, or what he would need to do to qualify.
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