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If a shareholder is evicted via Housing Court decision, and loses their proprietary lease what happens to the share certificate? Does it revert back to the Cooperative? Or, does the shareholder still own their shares? In other words who can sell the shares once a shareholder is evicted due to non payment of maintenance fees.
The co-op does not quite end with the unit. It has to inform the lender if there is a mortgage on the shares and the lender claim the unit. Otherwise the process continues until the unit goes on auction before it is taken over as part of co-op property.
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We encountered this last year. Our attorney filed the Notice of Default and commenced proceedings. The unit was auctioned. Relatives of the Shareholder were still occupying the apartment. An investor bought the unit at auction (with the knowledge that the unit was occupied). The investor wound up taking the occpants to court and having them evicted.
Your best bet is to have the corporation's attorney handle everything from start to finish to get them out and make sure that everything is handled legally and properly.
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Termination of lease means the person ceases to be a shareholder.
The shares are claimed/owned by the corporation.
It's the equivalent of a foreclosure.
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