Articles

Membership Equity in a cooperative housing corporation is one of most fundamental characteristics, and benefits recognized in this unique form of housing and stock ownership. For housing cooperatives where members gain equity in their membership or stock certificate, whether or not based on increased value of the dwelling unit, improvements, or general trends in real estate markets, in instances where a member sells their membership, the return equity amounts frequently become issues of legal dispute. These disputes, if unresolved, can easily reach a point where a former member files a lawsuit against the Cooperative seeking money damages.

Every Housing Cooperative establishes a set of membership application and eligibility criteria. Screening applications, while itself is not an unlawful practice if decisions do not violate the Fair Housing Act for discrimination against one or more protected classes (i.e., race or color, religion, sex, national origin, familial status or disability) or other relative federal, state and local laws, serves a legitimate purpose. These purposes include insuring that members can meet financial obligations, that members and their immediate family meet occupancy standards for certain sized dwelling units, and passing criminal background checks.

On December 19, 2019, the United States Court of Appeals for the Sixth Circuit issued an Opinion affirming a Michigan federal District Court’s dismissal of a condominium unit owner’s lawsuit alleging discrimination under the Fair Housing Act against a condominium association for its failure to ban smoking as a reasonable accommodation request. This case carries significance for condominium and other association-based communities in how courts continue to address claims under the Fair Housing Act relating to smoking inside a building or unit and the odors that result. This article goes over the history of the case, the Sixth Circuit Court’s opinion and analysis, as well as some key things that the association did that were noteworthy in the opinion.

On September 17, 2020, a Michigan Court of Appeals panel unanimously held, in Riverbrook v. Fabode, that trial courts are “… required to consider reliability of methods employed by counselor as expert, as well as her final opinion in letter that tenant required an ESA because of a disability, before determining whether owner of mobile home park had refused to make a reasonable accommodation as required by the FHA.” Riverbrook v Fabode, No. 349065, 2020 WL 5580152 (Mich. Ct. App., Sept. 17, 2020). In Riverbrook, the trial court erroneously rejected the landlord of a mobile home’s evidentiary challenges to the reliability and methods of collection of the tenant’s medical documentation to support ​his reasonable accommodation request for an Emotional Support Animal (“ESA”). Because of the Court of Appeals ruling in Riverbrook, Housing Cooperatives seeking information from members in reasonable accommodation requests for emotional support animals, are now permitted to ask for reliable disability-related information. Although these reasonable accommodation requests should be considered on a “case-by-case” basis, Riverbrook provides additional guidance for what information Cooperatives may seek when considering the request.

It is worth reminding Cooperatives of some basic pitfalls that may easily sink your summary or eviction proceeding against members. Whether your Cooperative has initiated an eviction for non-payment of monthly carrying charges or fees, or is terminating membership based on material non-compliance, a common question arises: What does the Cooperative do with that member’s monthly carrying or occupancy charges?

Personal injury lawsuits typically arise in housing cooperatives when a member, a person of a member’s family, or guest are injured on the Cooperative’s real property. Injuries can range from slip-and-falls, physical confrontations or fighting, to criminal assault and battery. Since the range of different types of cases in which a Cooperative may be defending claims seeking liability and damages, this serves as an important reminder to Cooperatives, of the legal responsibilities that Cooperatives owe. Specifically, this article focuses on those duties owed to non-members, such as guests.

Our Cooperative maintains its own insurance policy covering the buildings, exteriors and common areas. After some recent requests for replacements and repairs, and instances of units suffering damages, our Board of Directors is concerned with finding ways to trim costs in paying for damages that occur within the dwelling units, while ensuring that adequate insurance policies cover both the exterior buildings and common areas, but also everything within the units. Are there any ways that the Cooperative can save on having to go out of pocket to cover damages that would otherwise be covered in a traditional homeowner’s insurance policy?

The use of Zoom and other digital, web-based or video conferencing technology has become widespread throughout courts in the United States, since the onset of the coronavirus pandemic. With glaring uncertainty on when courts will revert to conducting hearings and trials in-person, it is important to highlight some basic tips and best practices for our readers who may participate in Zoom hearings.

Members elected to serve on the Board of Directors hold special and unique positions as fiduciaries to the housing cooperative corporation. A Director holds a position of trust, fiduciary and good faith to the housing cooperative to which he or she serves. While members elected or appointed to serve as a Director may not always be the savvy corporate type, it is important for Cooperative’s to establish certain policies, sometimes best contained in an Agreement, for each Director that will spell out that Director’s responsibilities and duties pertaining to ethical corporate conduct and the handling of sensitive, confidential information.