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I want to review my co-op board’s meeting minutes, but was told I’m not entitled to, even though I am a shareholder in the cooperative. Is that really true? Why can a prospective buyer can look at them when I can't?
You are legally permitted to read your co-op board's meeting minutes, but they can impose certain restrictions on your doing so, our experts say.
In the past, co-op boards could refuse to show board meeting minutes, restricting shareholders to viewing only the minutes of annual shareholders' meetings. However, some court cases have changed the rules about who gets to access these records.
"Recent court decisions have made clear a shareholder’s right to review cooperative and condominium board meeting minutes," says Jeffrey Reich, a partner in the law firm of Schwartz Sladkus Reich Greenberg Atlas. "However, a board can require that the shareholder execute a nondisclosure agreement with respect to the information contained in the minutes, and can require the shareholder to review the minutes at the office of the cooperative’s managing agent."
New York's Business Corporation Law, which regulates the governance of co-ops, requires boards to keep minutes of their meetings. And reviewing those minutes can be especially useful for those considering buying a co-op. As this New York Times article points out, it's in the minutes that a buyer might discover potential issues with a building, like impending lawsuits, problem neighbors, or looming assessments and maintenance fee increases.
Typically, though, the buyer's lawyer is the one to review these minutes, rather than the buyer themselves.
"A buyer who has no knowledge of what is typical practice and customary might misconstrue what’s being said and not understand that there’s a customary aspect to a situation," says Deanna Kory, a broker with Corcoran. "This is why a real estate attorney who knows what they’re reading will be able to look at minutes and see if there’s anything that’s unusual."
Kory has encountered some boards that are reluctant to allow attorneys to read the minutes, she adds. Should you encounter this, and prefer to avoid a protracted battle over the minutes, there are other avenues to find out what's afoot in a building.
"In those cases, we try to get answers via a questionnaire that is very detailed," Kory says. "And we often ask to speak to someone on the board, the managing agent, or the co-op attorney. Again, all of this is done by the buyer’s attorney."
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