Bills to Transform Co-op Purchases May Finally Become Law
Bruce A. Cholst and Deborah Koplovitz, both partners in Herrick's Litigation Department, spoke to Habitat Magazine about two bills introduced to the New York State Legislature. These bills would require cooperative boards to give a reason for rejecting an application from a prospective buyer. This is a big change from the current status quo, in which cooperative boards can reject a buyer for any or no reason (discrimination notwithstanding).
"It has increased support, and I’m hearing all over that this time there’s a real chance it will succeed," said Bruce, alluding to the fact that similar measures have been in discussion since 2009. "That’s too bad because it’s arbitrary and unnecessary, and it will discourage people from serving on co-op boards. Prospective purchasers who feel they’ve been discriminated against by co-op boards already have numerous avenues of recourse."
Deborah added, "I think this is going to increase legal costs for boards. If there’s a denial, the board will need a lawyer to review it. Managing agents may want more fees, and that’s going to have to get born by the community."
Read the full piece in Habitat Magazine here. Access may require a subscription.