First, I don't see anything wrong with the independent accountant to be at the meeting and attempt to answer any questions that shareholders have, even if the questions are simple or his/her job may seem like snowballing the audience. In fact, in preparation for the meeting, we ask shareholders to bring bring their audited annual reports to the meeting to follow the accountant's explanations. Similarly, we have several copies on hand for distributiton.

Perhaps the accountant was a bit expressive and the results of the report merited ä glowing expression. However, the independent accountant should be able to conclude his/her presentation with an assessment of the operations and may even compare last years results with the current year. Finally, the independent accountant may be an independent observer of the elections who may certify the results.

Obviously, your president may have been too long and by now a new change in the guard is something desired. However, I cannot see how a president is elected by shareholders. After all shareholders elect board members and board members elect the directors of the corporation. Thus, if your president is there, it must be because the other board members vote for him.

AdC

Having the Accountant at the meeting is always prudent. It adds to the Boards show of efforts in the financial area, permits shareholders to express concerns or ask questions with regard to the audited financials (which they should have well before the meeting, and some extra as AdC stated). Many times there are questions that a Board member just cannot answer like the accountant can (or should).

The Board hires the managing agent, the Board president typically runs the Board (sometimes unilaterally), most managing agents have, or feel they must be subordinate to the Board president. I had a building with a dishonest Board president, and when I assisted other Board members in exposing the infractions, the same person was elected (who knows maybe out of fear?), and I was soon asked to be removed from the building. If I had to do it again, I would, but different. Most managers would not, and would follow what "the boss" says to protect their self and/or the account. It is wrong, but done. (I feel I work for the Corporation & the building, not the Board; the Board is a conduit for direction)

Not that it rights a wrong, but would your vote have made a difference in the election results? If so, then maybe you should act. If not, learn from this election and prepare yourself and any consortiums for the next one. I would also confront the manager privately and inquire why your proxy was left out.

As AdC points out, even if he is elected again to the Board, who then elects him as President? It seems to me that the bigger challenge here is getting people to speak up and stand up for what is right. Herein may lie your calling...
So many ways to skin this cat..

~AR

"seems to me that the bigger challenge here is getting people to speak up and stand up for what is right. Herein may lie your calling..."

As a board president, I am frustrated by three fundamental issues:

(1) Board members' and, ultimately, shareholders' inability to stand in their legs and basically say in an simple and civil manner and without fear what they think about ISSUES, NOT PEOPLE. As a result of board members' secret phantoms (fear of not being liked, fear of being wrong, fear of being judged stupid, not smart or too backwards, fear of...) there is no discourse and ultimately no growth and progress for the co-op. Consequently, board end following the "bully", the "dearing", the "fearless leader" and depending on the good or bad intentions of the individual in question.

Board members are leaders and workers. Consequently, keeping silent, acting in block (rather than INDEPENDENT THINKERS) or applauding the "elocuent speaker" without questioning or challenging when necessary or adding to the discourse accomplishes nothing for the CO-op which they serve.

(2) Board members who DO NOT make an effort EDUCATE themselves by reading.

(3) Board members who ARE NOT willing to sacrifice and share the burden of the work just because "Managment" is supposed to do ALL. Board members who are elected, but squarely refuse to be delegated a function, "I cannot do anything from my work or I have a busy life after work" WELL, what about your lunch time?... WHY are you on the board?

Thanks again for sharing from the management point of view.

AdC

Thanks a lot for your responses, everyone.

Yes, there is a lot of bullying and a lot of fear and a lot of head-hiding-in-sand going on here.

As in most buildings, people are elected to the board by the shareholders; then individual officers are appointed by their peers on the board. Basically. My understanding of how the current president became president is that, a few years ago, in the middle of the term, he suggested that he replace the guy who was then serving as president because he was convinced that he could do a better job. There was a bit of a struggle but eventually the bully prevailed. He's one of those people who screams the loudest and the longest and that's how he gets things done. (He has even said as much.) Seems pretty amateurish to me, but...

During the most recent term, he suggested that he remain president because he was the only one with access to certain information and people, and he was already the president, and so he should just remain president, yadda yadda yadda. The three other board members are pretty accommodating and said: "This seems to be really important to you, go for it." But during the course of the term, the three other members realized that the president was out of control. In one instance, he misrepresented "information" he had gotten about a buy packet. He didn't want someone in the building, so he sent an email to the other members saying that he had heard from the realtor that the applicant had lied about his employment situation and that he (the president) recommended rejecting the applicant on the basis of that "information." Two of the other board members strongly objected to this way of doing business, stating that any questions about an application should be resolved by contacting the applicant's employer and the applicant directly, not relying on hearsay. This made the president furious, and he sent one of the board members a private email saying that he was "keeping track" of the times she had disagreed with him, that he didn't much care for it, that she should keep quiet and not question his actions--and that she should not show his email to anyone. The two concerned board members contacted the applicant's employer directly the following day; the employer confirmed that the applicant had accurately represented his employment situation. The board members followed up by contacting the realtor, who spoke very highly of the applicant and presented a much different picture than the one relayed by the board president. Confronted with his misrepresentation, the president threw a tantrum, saying: "How dare you say that my behavior was inappropriate? How dare you question my honesty? I don't give a f*ck--I don't wanna be president anymore!" The three other board members requested an emergency meeting to discuss the matter. The president refused to attend. At the meeting, two of the officers asked the VP, who has lots of management experience and natural leadership qualities, to assume the role of president. The VP, who has a sense of loyalty because his wife and the president's wife are good friends, felt uneasy about such a move and declined, and ultimately the status quo was maintained. (By the way, that buyer was accepted in a vote of three to one.)

After a few more similar upheavals, a special meeting was called to request that the president step aside. By that point, the VP was willing to assume the role of president--but only on the condition that the president agree to such a shift. Naturally the president didn't agree, saying that he would only be on the board if he could be the president. So the board was deadlocked two-two and the status quo was maintained. At the end of the term, the two most disgusted board members stepped down and this man was re-elected. Would my vote have made a difference? I don't know.

My initial impulse was to send the managing agent a private email asking her what happened, but my experience with her suggests that she would just blow off the email. Should I send her an email and cc the man who is currently (still) the VP? Although he doesn't like conflict, he is definitely honest and wants to do the right thing, and I can't imagine he would be happy to learn that this sort of thing was going on. Or, should I have my attorney send a certified letter to the managing agent and a copy to the current board?

I have a nagging feeling that this proxy tampering is just the tip of the iceberg.

Sorry for my frank and blunt advice.

Do nothing. YOu obviously seem to know to know the court intrigues. Thus, you should run for elections next year, commit to it, volunteer to be president and have the "faint of heart" elect you as president.

So, end of the intrigue, end of the wild president, and move on in a more straightfoward form of government.

Conclusion: Don't complain, but act. Otherwise, no sense to keep going with the same intrigue. For your info, it applies to your board members too! Let them know that.

AdC

Your advice is pragmatic, AdC; thanks. I suspect you have a stronger stomach than I do, though. I had indeed been considering running for the board, because the president had stated that he would not run for re-election. At the last minute, however, he decided to run, and I withdrew my name. I'm very happy to volunteer for committees, but I simply won't put myself in a situation where I have to deal with this man any more than I have to. I guess that's a bad attitude, but I just can't have that nonsense in my life.

There has been very high turnover on this board. The people who are trying to "move on in a more straightforward form of government" simply give up, ultimately. And they aren't people who would ordinarily be considered "faint of heart."

Sorry to complain; I just thought that there might be a procedure to follow in the case of a proxy that gets stolen or thrown out by a managing agent.

Perhaps you shoud listen to the song and get some courage just like those whom you deem "not to be faint of heart."

Unfortunately, when one thinks that a situation may be corrected and you may aid to the transition, you should plunge to the task. Otherwise, smile and let others impose their will. However, don't criticize because you are not willing to take the punch or the sacrifice.

In my case, I felt that the president who represented the building was going to do something that was against the interest of the co-op and told her at a board meeting the reasons why she should step down as the president and let another person take over the presidency for obvious reasons.

The dialog and reasons on both sides went on for during two meetings in front of all the board members (all green on board affairs including me). Although the other board members felt like me regarding the continuation as a president of this board member, they did not immediately jump on the bandwagon; they listened first, then became vocal in their feelings and finally every board member requested the president to step down in her capacity.

The peson continued be a board member; altnough she became a formidable opposer, to this day I ADMIRE her attitude for providing valuable feedback and even agree with most of the decisions we made on behalf of the co-op.

For your information, we were the first all women board the building had. I don't think many vendors including the union knew how to deal with an all women board. We prevailed in many areas because what united us was the need to improve the co-op on all aspects. I think the board was so spontaneous and the spirit to good and even the sponsor representative (another woman) was highly supportive and we were able to learn from her experience and gain tons from her goodwill.

AdC

Someone had to defeat the Roman army..
Someone has to overthrow terrorist governments..
and Someone has to step up to be the leader they were ment to be. fact is, if it is bothering you this much, you do have it in you to achieve not only a successful outcome, but to obtain the support you need and run the Coop as it should be.

Galatians 6:9 - And let us not be weary in well doing: for in due season we shall reap, if we faint not.

just thought I'd toss that in!

AR

GK - If you and other owners feel your board president is out of control, you should, and can, do something about it. Your vote will make a difference. That's what the power of the vote is all about. Look for new candidates to run for the board. Make the president's wrongdoings known to all owners - IF you can prove it with solid evidence. If he is out of control, take control in a democratic way and work actively to get him removed from office.

We've avoided a 2-2 deadlock on certain board issues by appointing our coop attorney as assistant board secretary, and he can vote as a board member. If, for ex, your vote is 2-2 to have the VP replace the president, the attorney's vote would be the tiebreaker. If your president is truly out of control, the attorney would/should vote in favor of the VP since he is duty-bound anyway to act in the best interests of the coop.

Re: one point you noted, you settled the issue of whether a buyer lied about his employment by having 2 board members call the realtor and employer who confirmed his employment. Doesn't your sale package include a letter of confirmation from a sale applicant's employer and 3 business reference letters? It should. Credit reports also include employment verification. If there's a question and if a buyer pays a "sale package processing fee" to mgmt, your mgmt office should make any necessary calls to employers, banks, to confirm any info. That's part of what they're paid a fee to do. There's no reason to rely on hearsay from your board president, or any board member.

BP, I appreciate your positive response, and I want to believe it but--

"Your vote will make a difference."

It's hard for me to believe that my vote will make a difference when the managing agent essentially threw it away because she knew that the person I had designated as my proxy would not vote for the current president. Frankly I find this situation demoralizing.

"Look for new candidates to run for the board. Make the president's wrongdoings known to all owners"

We tried. It apparently made no difference, even though supposedly the election was close. The meeting was poorly attended this year; plus the president had all of the sponsor's votes. Before this recent election he bragged to some shareholders that he got "twice as many votes as [x board member] last year." Which I guess is fairly easy when you have all of the sponsor's votes.

"IF you can prove it with solid evidence."

It's all in the emails. Thank god for email.

"If your president is truly out of control, the attorney would/should vote in favor of the VP since he is duty-bound anyway to act in the best interests of the coop."

Interesting idea. The only potential problem I see is that the president has created a situation where only he has any communication with the attorney.

"Doesn't your sale package include a letter of confirmation from a sale applicant's employer and 3 business reference letters? It should."

Yes. The applicant stated that he had received a recent promotion and substantial salary increase (which wasn't reflected in the W2s but was reflected in the employer's letter as well as in the final pay stubs); the president emailed the board that the realtor had told him that the promotion had fallen through and that the applicant was misrepresenting his situation. In fact the realtor never said this; the board president just made it up. It's not the only time he got caught distorting facts, just the most egregious example. And it's escalating: this man recently joined the community board, which means that he will be engaging in his divisive, back-channel tactics on a much larger scale.

Thanks again for your response, BP.

You stated, "...this man recently joined the community board, which means that he will be engaging in his divisive, back-channel tactics on a much larger scale."

As a member of a Community Board myself, please allow me to correct you on one point - that he "joined" a CB; all members are appointed. You might want to find out who appointed him and approach them with proof of your concerns. That individual might/might not reappoint at the end of the term.

That having been said, I certainly pray it's not MY community board he's on!

I hope you will start now to prepare for NEXT year's election so this person is not re-elected. Good luck!

Thanks for the clarification. I'm fairly certain I know who appointed him; it's someone I've known for years.

If this man were on your community board, you would know it.

I AM going to start now to prepare for next year's election. I'll need to be smart about how I go about it, however.

Thanks for your feedback.

GK - It is a tough nut to crack if your board president has the sponsor's votes, especially if that represents a lot of shares. We had that problem, but we worked through it. And our sponsor has been selling and his shares aren't many anymore. But you CAN change things. A few suggestions:

1) Get any help you can from other board members who don't like what the president's doing and want him out.

2) Get your apathetic Shs more involved and concerned. If possible, tell them about any ways that "financials" may be misused or mismanaged by the president and/or mgmt. Shs react if they know/suspect their funds aren't used properly or if they are being hit in the wallet for maint increases, assessments, etc. needlessly or too often. That's one way to shake them up, and once you do you can shake them up about other things too.

3) Request a "special meeting". If you're not familiar with this, let me know and I'll explain how that works. If you can rally your Shs, you can ask the president very pointed questions at a special meeting. For ex, ask why a proxy you were named on was thrown out by mgmt. You know if it wasn't used if you weren't given the chance to vote those shares. Maybe it happened with other proxies too. They don't have to be sent to mgmt. They can be given to the appointee and brought to the annual meeting. Make a case about this. I know Shs who keep a photocopy of proxies they are named on.

4) This involves getting a resolution put forth, amending the by-laws, and a vote by all Shs - but if you get enough Sh support and have board members on your side, you can get the president out if you have board "term limits". Maybe you already do. Check your by-laws.

GK, if this "presidential wrongdoing" is important enough to you, you can make a difference. But it requires effort. AR - Nice quote from Galatians that we shall reap if we faint not. Here's another one, GK. Maybe not as eloquent, but it always helps me remember what I need to do.

Over my desk I have a piece of paper on a bulletin board. On it is just a simple straight line on a steep angle going from left to right, and under the line are these words:

"Nothing slides uphill."

"We had that problem, but we worked through it."

May I ask how you worked through it? The number of sponsor shares in our building is rapidly dwindling, but it still represents a sizable block.

"Get any help you can from other board members who don't like what the president's doing and want him out."

All three of his fellow board members found him problematic during the last term, but because of the personal issue (i.e., VP's wife and president's wife are close friends), the VP would never take a firm stand and the board was always deadlocked two-two. The VP is still on the board this year; I don't know the two new members. It will be interesting to see how that dynamic plays out. The board is in the honeymoon phase now, but my prediction is that the two new members will be alienated fairly quickly. The president has demonstrated PATTERNS of behavior (unilateral action, misrepresentation, back-channel tactics, divisiveness) that seem compulsive. He can't help himself. He can't stop. He can't not act out.

We've all seen people like this. Right? This is a Jeff Skilling type of person. A tragic character. Eventually they go down in flames. What's truly tragic in cases like that is the fallout, which I would like to minimize if at all possible.

But I will need to be extremely careful. We're not just talking about a difficult person here. We're talking about a frightening person.

"Request a special meeting."

I am familiar with this and this was considered. Ultimately we felt that it would be too polarizing and disruptive.

"You can get the president out if you have board term limits."

I'm all for term limits. Five years is long enough for any one person to be president. He'll never go for it, of course. Yes, I would like to try to pursue that. Other shareholders have raised the issue, so perhaps there is fertile ground there.

I really appreciate all of this feedback. I've done so much reading on this topic over the past week that I'm feeling a bit saturated and am having trouble remembering where I read what. SOMEWHERE I read that there is a clear protocol on how proxies should be dealt with (I think I read that they should be accounted for at the beginning of the annual meeting).

Here's how I think I would like to proceed.
1. Send an email to the managing agent (and cc my designated proxy, as well as the current board VP) documenting her mishandling of my proxy and holding her accountable for that.

2. Once that has been documented, suggest to the VP that, for the next election, an impartial third party like HBA be brought in to monitor each step of the process.

The key words here are "each step of the process." That's where we were too trusting in this last election. We thought that it was enough to have an impartial shareholder help the managing agent tabulate the votes.

Finally, thanks to AR and BP for the quotes. The one over my desk reads: "Do not become enamored of power." (Michel Foucault)

Put EVERYTHING, everything in writing. Have all votes noted in the min, and if you see that something is very wrong, write the Shareholders. Stress on them that its THEIR money the Board is spending. If thier maint is going to be raised, they will be intrested. All you need is one or two other shareholders to push this change through.

We got rid of a Super who, had been caugh stealing, doing major renovations without permits and the building was filty. He was doing favors for board members -- and they, even after 99% of the SH raised thier hands in fav of fireing him, refused to fire him. ONE board member bravely stepped out, became a whisle-blower and wrote a letter to the SH. The board was forced into firing him.
The Paper/Email trail is your best defense and offense.

Yes. Document, document, document.

"Have all votes noted in the min, and if you see that something is very wrong, write the Shareholders."

What do you mean exactly by this? You mean how many votes each candidate received?

Thanks for your response. I've been reading through some of your posts and I have a better understanding now of what your building has been through.

It is great that this worked for you. In my coop several sahereholders have written & exposed corrupted board members to no avail. How does one deal with apathetic shareholders who see & hear no evil. Even when given assessment & increase after increase, they continue in their slumber.

Even when given assessment & increase after increase,...

Is this an indication of corruption on the part of the board?

Don't you think that a board member who is a shareholder is also committed to pay increased maintenance and assessment?

What does corrupt mean to you?

There isn't that much money to make in a coop to have your reputation ruined for a few dollars. You may call your board ignorant, power or not so power driven, opportunits, etc. but to say "corrupt" you need to substnatiate it with very specific proof.

AdC

AdC

"O" -

If you have Shs who see/hear no evil even if corruption or other wrongdoing by board members is supported by evidence and thrown in their faces, they probably don't understand it or know how to deal with it.

If you have Shs who don't gripe about repeated maintenance increases or assessments, maybe they have so much money they don't care (unlikely!), or they know the coop is in bad shape financially and rising charges are necessary, or they complained about things in the past and got nowhere so they figure there's no point to complaining about this.

Apathy can defeat the best intentions and plans. Once it sets in and gets deeply rooted, it's hard to overcome. The best thing to do (my opinion) is get off Apathy Road at the first exit and slowly find a new route to where you want to go. De-emphasize negatives. Stress positives. Work toward better communication with Shs and when you see a glimmer of reaction from them, respond to it. Work to re-build their confidence and interest in the coop. Show them that what they think, want or don't want matters. Don't focus so much on getting them on your side. Focus on letting them know you're on their side and decisions made will benefit them.

Sounds good, huh? It can be done. That's my philosophy lecture for the day. :-)

Sorry to disagree with you AdC but there is massive theft from coops/condos and the bigger and richer they are the more there is to take - I am in a very poor coop, yet over $100,000 a year disappears top line - this is how
1) the management company says it writes checks to pay xxx, but those payments are not really made, and then the accountant overstates the expenses in the financials a)how many people on your boards look at the financial information and then do they check the disbursement ledger against the bills, are they given the bills?
2) what about capital improvements, roof, garage, lobby - try contracts to begin with a double what they should and then unforseen circumstances that double it again and then you get subpar materials and labor, and repairs must be made immediately - that is many hundreds of thousands per contract
3) what about regular repairs and supplies - what are the kickbacks on those -
Do you really think this is not prevalent - it is and the reason why is that the District Attorney and the Attorney General's office will do nothing so the management company, certain board members, accountant, contractors, suppliers are very happy - and you cannot do anything unless you wish to start a lawsuit which starts at $100,000 a year

I do not disagree with you regarding your points, but I object to the hersay and light statements. The calling of a corrupt board with an example of increasing maintenance and assessment, does not equate unless you bring other deeper issues that deal with general check and balances that a board must establish, adopt or question as part of co-op operations. To wake up one day and say, Ï was robbed, is not enough! As you mentioned in your article, what board member checks your paid invoices against your checks. Again, it's a problem of SERVICE more than title on the part of the board.

For each item you wrote below, there is fiduciary responsibity to assume by the board to ascertain that they are not being taken for a ride. Of course, the bottom line is WHO IS WILLING TO SACRIFICE? Who will SERVICE and who will want to be SERVED? This is where shareholders must exercise their prudence and not just vote for a nice facade.

Example:
In the case of #2, you do what is required of a board: get a reputable engineering company after selecting from several candidates. Check their references, have the engineering company prepare the close bid package, and do the due diligence required for those bidders that you feel fall within your budget. Hire the engineer to do your routine inspections of the construction and have the board involved in the process through project reviews. QUESTION, QUESTION AND QUESTION; after all it is your project and you are paying for it.

Well, it's a problem of getting involved, a problem of assuming responsibility, a problem of service, not of adorning your resume.

But lamenting, crying corrupton, etc. is futile unless responsibility is assumed.

AdC

Try to stay as positive as possible, but dont let up. All you need is a few dedicated SH who see the problem, and will help you spread the word. Which, you have to do in (carefully) writing.

We had one Board member who told SH that the SH's who wanted him off the board had a personal agenda aganist him. And were telling lies. However, after someone finally sent a letter to all the SH exposing where they could find in the SH min, that this BM HAD forged proxies and other documents, we slowly chipped away his lies, and after three years, got him off the board. We are now discovering so many problems in the building due to his manangement, that it may take years to clean up the mess he left behind. BUT, he is already working on getting back on the Board.

You are right. Man compaines have been given a free hand for too long and the AG wont help.

Email has made ALL the diffrence in our building. Our Man and a board member (who wants building permit favors) tried to quickly (Fri afternoon deadline) push the rest of the board into signing a $11,000 contract for AC brackets we did not need. (we were brought up to code the year before) In the past we would have realized this months later, and it would have been too late. COPY or BBC EVERYONE! The more people who know, the more the Man and Board will begin to pay attention.

Our little Emil group swinged into action. Started the Email paper trail, and stopped the contract.

No matter if its One or fifty Emails, once the trail is established, and you start building a record, and constantly reminding the Board and Man that you now have this trail,, you gain a lot of control QUESTION EVERYTHING.

OUr man com tried to stop Emails...But it was too late.

J - You said you're in "a very poor coop, yet over $100,000 a year disappears topline". Regardless of whether your coop is rich or poor, if over $100K a year disappears and can't be accounted for, you have a major problem. Based on what you said is how this money is disappearing, a few comments:

- You said mgmt "writes checks to pay xx but those payments are not really made, and then the accountant overstates the expenses in the financials"? If you know this for a fact, why do you and your board put up with it? Fire mgmt and the accountant, and get honest people to handle your funds.

- Your mgmt company should give you a monthly report that includes a bank statement for the coop's checking account. It's not a big deal to look at that statement and see who checks are written to and for how much.

- Why are project contracts "double what they should be to begin with"? That's outrageous. Why do you even allow this? Doesn't your board look at bids and approve who a contract is awarded to? How can "unforeseen circumstances double it again"? Don't you use an engineering consultant to prepare project specs, get bids, advise you and oversee projects? If you don't you should. If you do and a lot of money is going down the drain needlessly (or into the wrong hands), it sounds like your engineering consultant should be tossed out along with mgmt and the accountant.

I know theft happens - but J, how can you say "the reason why is that the DA and the AG's office will do nothing so the mgmt company, certain board members, accountants, contractors and suppliers are very happy"? Corruption/theft is sometimes hard to uncover or prove. But if you know mgmt writes checks to people who shouldn't get them or project contracts are double the cost they should be to begin with, don't blame the DA or the AG's office. The blame goes to your board. A board shouldn't knowingly allow these things in the first place, and should definitely not let them continue year after year and do nothing about it.

Are you on the board to do the e-mail trail or what software do you use to SPY on board members?

I would love to find out! Please share the secret of tough stewardship!

AdC

I am not sure what you mean by spy on Board members.. We dont spy on anyone.

The Email trail is the one that we, the shareholders send to the board and mang agent... We send Emails from our various Internet providers... Nothing secret or devious going on here...Just a little checks and balances...

AliceT

Without question there is a problem on the board that we have not been able to correct - as noted on previous postings shareholders are apathetic and will not come down and vote and those members of the board have the votes and we the few who try to tell what is going on are not listened to because those members tell people they interview that we are trouble makers, etc - Also the fact that at least 3/4 of our building really does not speak english well is another problem and most of the shareholders do not understand no matter how many times they are told that the only way to change things is to vote - they will not come to meetings - so naturally the problem continues because these people are on the board forever and it is their accountant and lawyer who tell the board that they cannot obtain documents, or what I say is not true even though I can present the documents - how many people to you really think understand financials -

In other words, you leave the bad guys and the bad management in order to play the Carmen Sandiego game or Clue, etc.

If you put so much effort in e-mails, letters, etc., why don't you outvote the entire board and let the host of good guys and gals put their energies in running the co-op efficiently, rather than wasting their time looking in their electronic files for e-mails???

I think your co-op "little checks and balances" sound like a waste of time when the efforts may be placed in electing conscious shareholders.

Just a thought!

AdC

First, I dont know what you are talking about "looking in eletronic files". We are not that computer savvy, sending emils is high-tech to us.

Without the emails and letters (we sent), and not letting them (the bad guys and mang) get away with anything, we created the "checks and blancnes" or the Email/paper trail, and by doing this we were successful this year in finally (took us three+ years) ridding the board of what you call the "Bad guys".

Although we still have the same Mang Company, they have suddely become our best friends, answer every Email and are actually following up on both complaints and request. So, as you can see, our whatever you want to call it (Carman Sandiego game, Clue) worked!!!
Thank you for your colorful comments. AliceT

didn't have time to finish first reply - yes you are correct there should be records, however when board members request the bank statements, bills, etc they are not forthcoming - because they are told they do not have the right to them and the lawyer misquotes the law when questioned - you have to understand that these people are the majority and unfortunately one of them an officer runs everything and unfortunately the rest of the majority believe whatever is said by her,and vote with her - I did not say that these people are necessarily bright - in fact the stupider the better and they will not believe the others who can cite law and show the numbers but cannot get through to them -it is because you have board members, accountant, lawyer, etc all together and no matter they will get the vote - when I say I blame the DA & AG it is because they know full well what is going on, and the only way to retrieve the funds without massive lawsuits is thru them but they will not touch the matter - You may be very lucky to have a board that wants to serve the shareholders but in our coop most of the members do not even know the law that they are to serve the shareholders or that they are liable, they laugh when they are told that, and yes one member does ram contracts down the board because she has the vote and the consequences of same have been horrendous - and the result is we are raised and assessed every year with nothing done in our building and are building up enormous debt that we will be unable to pay -

J - Forgive me, but I don't recall if you are a member of your board or not. There have been a lot of postings here. Are you on the board? Kindly reply. Thanks.

This sounds too familiar,, but if you keep chiping away, you will succeed... The Email/Paper trail is your most powerful weapon.. The Board member who was our problem could knew exackly how to manipulate the small egos of certain board members... and anyone who disagreed with him or call him on his persoanl agenda, was labled as having a personal vendetta against him. His Victem act was worth a Tony award..

Still interested in hearing feedback on how best to proceed now. All of this is still a little new to me.

If I'm going to try to suggest that the building bring in HBA (http://www.honestballot.com/) for the next election, it seems to me that I need to document the managing agent's mishandling of my proxy in this last election.

What is the smartest course of action?

A private email to the managing agent?

Or: an email or certified letter to the managing agent with copies to my designated proxy and, for example, the current board VP, who is honest if a little spineless? (One of the reasons he gave the other board members last term for not taking a firmer stand vis-a-vis the president is: he was afraid that the president might do something rash if confronted. That is indeed a very real fear. I don't think that the president would actually resort to physical violence if thwarted, but...well, I don't know. He might.)

Or: a certified letter to the managing agent with copies to every single shareholder in the building? As far as I know, shareholders have the right to a list of current shareholders with their contact information. This possibility might be too dramatic, however. I don't want drama. I want action and pragmatism, and an end to this abuse of power. I want things to be straightforward and above-board.

This afternoon I have an appointment to meet with my attorney, and I plan to run this by him. It just so happens that my attorney is no fan of the board president or of the management company. When I was purchasing my co-op, the attorney called the board president "an idiot" and said: "They've gotta get that management company out of there." His remarks seemed somewhat opaque at the time, but they're starting to make more sense.

Send it to everyone on your list, certified, by email and copied again.

The more people who see this, the less likely they are to denie that they recied the request. Do you have Email addresses of fellow Shareholders. And put them in BCC.. with a notation on the request that Shareholders have also recieved this..

Our President and Mang Agent, ignored a request like this three years ago. But we only sent it to them. And, by doing this they broke the ByLaws of the building. Before the Next SH meeting, we sent the letter/emial to absolutely everyone even remotly involved. Copied the AG....
This will take time but if you keep this up, stay steady, and you too will win...

Thanks so much for your response, Alice.

My plan is to request a list of shareholders and contact information from the managing agent (with a cc to the board VP). The request will doubtless meet with resistance from the MA and the BP, but they really kind of have to comply. I'm sure the MA will try to run out the clock (as she has done previously on other issues), but that's okay: I'll just keep asking politely.

Then, my attorney will send a certified letter to her and to the board VP, with copies to all shareholders, documenting the recent mishandling of my proxy and, in light of that mishandling, requesting that the building bring in HBA to monitor next year's election.

We may have some leverage here. In an article (http://cooperator.com/articles/1189/1/Business-Corporation-Law/Page1.html) in The Cooperator, I read the following:

"Inspectors of Election: Before the 1998 BCL overhaul, boards were permitted to ignore any bylaw provision requiring appointment of inspectors of election—so long as no shareholder demanded such an appointment. Currently, if such a provision exists in the building’s bylaws or Certificate of Incorporation (which is usually the case), compliance is mandatory."

And in fact our bylaws state:

"At any election of directors where more candidates are nominated than there are positions to be filled, the election shall be conducted by two inspectors of election to be appointed by the president. . . . Before entering upon the discharge of their duties, the inspectors appointed to act at any meeting of the shareholders shall be sworn faithfully to execute the duties of inspectors at such meeting with strict impartiality . . . "

It seems to me that the MA (and indeed the entire board) should have been aware of this stipulation in the bylaws. If they were aware of it, they may have been taking for granted that the shareholders would not be. At any rate, if compliance is mandatory and if this was not adhered to at the meeting, it suggests that, technically, the election was not handled properly.

Our bylaws go on to outline the proper "Order of Business," of which the third item is this: "Roll call and presentation and examination of proxies."

Does anyone know what, exactly, is meant by "presentation and examination of proxies?" This is another point where the last meeting diverged from the bylaws.

"Presentation and examination of proxies" means all proxies for any meeting of shareholders should be presented to the inspectors of election or whoever tabulates the shares so the proxies can be:

1) examined to make sure they're valid submissions (e.g., properly signed and dated)
2) counted to tally the total shares represented in person and by proxy for that meeting

This is done at the beginning of the meeting to make sure there's a quorum so the meeting can properly continue. It also gives the tabulators time to double-check the shares by proxy so they can be included in any vote (including election of the board) that takes place during the meeting.

Proxies are usually mailed or given to mgmt but mgmt people may not be the tabulators of shares at the meeting. Proxies are also given directly to designated proxy agents and that isn't usually known until they arrive at the meeting.

It's my understanding that only proxies with original ink signatures are valid (not e-mails, faxes or photocopies). Also, proxies naming a property mgr or other mgmt person as proxy agent can only be counted to establish a quorum. They can't be counted in any voting. And also, proxies can't be counted in any voting if the proxy agent doesn't attend the meeting - unless the proxy, for ex, lists board candidates or issues to be voted on and allows Shs to indicate how they want their shares voted.

In my previous post, I said "proxies are usually mailed or given to mgmt but mgmt people may not be the tabulators of shares at the meeting." When I re-read that, I realized it needed clarification. I didn't mean that mgmt people CAN'T be the tabulators. I meant they may not necessarily be the ones to whom that task has been designated.

Thanks for the clarification, BP.

"Also, proxies naming a property mgr or other mgmt person as proxy agent can only be counted to establish a quorum."

So if the sponsor names the managing agent as his proxy, she can't vote? Or shouldn't vote?

If the sponsor names the board president as his proxy, I assume that the president can then vote (for himself), correct?

GK - Our mgmt co and coop attorney told us if the sponsor (or any Shs) name the managing agent as their proxy, he/she CANNOT vote on any issue or for a board. A managing agent works for the full board, no matter whom it consists of. It can also reflect "share manipulation" if, say, a managing agent is in cahoots with a disreputable board pres or if he doesn't like one or two board members and wants them out for his own reasons.

If the sponsor (or any Shs) name the board pres as his proxy, the pres can of course vote for himself. If the pres hopes to be re-elected, I'd be very surprised if he didn't use any proxies he has to better his own chances.

"If the pres hopes to be re-elected. . . "

"Hopes" is an understatement. There's a certain desperation about it that would be comical if I weren't so concerned about the building. If someone will only serve on a board if he can be its president, if someone has to resort to all sorts of strategery to get re-elected...dang!

Perhaps this is straying a bit, but as I mentioned in another post, the VP hesitated to take action because he feared rash behavior or fallout from this guy. This is a textbook bully we're talking about here. I wonder how many other concerned shareholders/fellow board members have suffered in silence because they feared retaliation?

GK: If your board VP won't take action to help to get rid of your pres, I can't say I think much of your VP either - especially if the pres is not only a bully but also guilty of much wrongdoing. Using intimidation to get elected or to control things is not uncommon but people only succeed in bullying if no one stands up to them. What about your other board members? If they care about your coop, they should work together, tell Shs what's going on (and document it), and get the pres voted out. There's strength in numbers.

The pres might seem like a force that can't be overcome but he's only one person. Rally the troops, diffuse his power, and get out of this defeatist situation.

In the perfect world, this is the way it should be. But our Pres had a majority of the Board on his side (the super worked for them) You need to rally the SH to elect at least one of you to be on the Board, two would be best, and then you can start to fight from the inside. Everyone who comes to this site, by now knows that a controling board member is very hard to get rid of. He/she has figured out how to pull the strings.

Remember that most people just want to come home to peace and quiet... But if you do the grunt work, they will follow. AND once they see that a majority of SH are backing you, they too will join your team.

Bullies hate to be confronted, and in reality they want to be win the popularity contest.. So if you continue to expose them -- you will gain with the SH and eventually get them out... (Poetic justice: One of the BM who had extensive (illegal) renovations by this Super, lost at least one deal, and had to put off his closing because of the illegal work.)

AliceT wrote:
"Everyone who comes to this site, by now knows that a controling board member is very hard to get rid of. He/she has figured out how to pull the strings."

Word.

BP wrote:
"Rally the troops, diffuse his power, and get out of this defeatist situation."

BP, I appreciate your optimistic encouragement. "Defeatist" indeed describes this situation well.

Sometimes I feel as if I'm one of the few people willing to stick my neck out, and that can feel isolating. No one wants to do something that will ruin one's life or at least make it more difficult than it needs to be.

One thing to keep in mind... I know that we're not supposed to engage in "analysis" on this board, but I sort of can't help it and I do think that it's relevant here: I strongly believe that this is a question of Antisocial Personality Disorder (APD) with a strong narcissistic component. This is a combination often seen in criminal populations but also, very very occasionally, in high-functioning people. You really have to tread carefully with such folks, as they are playing by a completely different set of rules than most of us. And they can do very real damage.

I agree. It's tough when a key person plays by a completely different set of rules. It's like one team member insisting on playing basketball when the rest of the team is playing baseball (maybe a poor analogy but you get my point). Don't worry if your pres is one of those high-functioning people who can be known to act "bizarre." Focus on how your board and coop function. If you really suspect he could do damage or harm anyone, tell the Shs (but carefully without scaring them). Maybe voice concerns to your local police precinct and ask them to note your visit in their files. If anything did happen in the future, you'd have a piece of your paper trail with them.

"I agree. It's tough when a key person plays by a completely different set of rules. It's like one team member insisting on playing basketball when the rest of the team is playing baseball (maybe a poor analogy but you get my point)."

Or, to use another analogy: it's kind of like Dick Cheney.

Thanks for the idea about making a note with the local precinct. Can't hurt, I guess. They'll probably think I'm nuts, but it can't hurt.

GK: Alerting police to situations before they happen or go too far can help. We had odd characters of all ages at all hours in/out of 2 apts owned by brothers. We suspected but couldn't prove drug dealing (hard drugs). Some characters were so whacked out, they could barely walk. We told local police and they began patroling our block and making their presence obvious. Within a month, no more characters. Both brothers sold their apts in the next year.

A few years ago we had an owner who said residents were out to get her. She'd pin them in the elevator and say, "I'll get you before you get me". We told the police about her. She trapped an owner's teenage daughter in the laundry one day and was slapping her. Another owner called the police. They came just as she was about to hit the girl with a wrench that was by the sink. She was arrested for assault and it took 2 years but we got her evicted. Our bldg isn't Trump Tower but it's a nice bldg. You never know. So a few words to the police can't hurt.

GK, You will be stunned by how many of the BM dont have the faintest idea of the law or ByLaws.

As to the SH list, go to the AG site and you will see that they are required to give you this list. It took us four months to finally make our Man company comply. And, once more Email power ruled. After they saw the Emails piling up, and other SH making the same request, they had no choice. You are in business with all the other shareholders, and you have a right to know who they are.
Our mang company frist tried to get past us with a very old list, but we quickly called them on this.
Keeping this list is one of the most basic jobs of the ManCo, and when you write them, cut and paste the paragraph from the AG site...
CC EVERYBODY.. Remember, they dont want other SH to see what is going on....Read the Bylaws... ask questions.. and at the same time, stay professional and businesslike.

Thanks again, Alice.

"cut and paste the paragraph from the AG site..."

The URL for the Attorney General is: http://www.oag.state.ny.us/realestate/coop_prob.html

And for the BCL: http://law.onecle.com/new-york/business-corporations/index.html

Does it do any good to go to attorney general about an out of control board?