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2010 Legal Update

By Randall A. Pentiuk, esq. and Creighton D. Gallup, esq.


        Our goal in this class is to equip you with a multitude of new ideas to take back and put into action at your Cooperative.  While we do not want to equip you to act as your own attorneys, we do strive to make you aware and sensitive to emerging legal issues so you will know when a legal issue arises in your Cooperative and the need to obtain competent legal advice.

Beyond sharing our prepared presentation with you, we want you to ask questions on matters currently on your mind.  We will share our experience and expertise with you but please do not use it to circumvent your Cooperative Attorney, who should be consulted to ensure that your course of action meets all the facts and circumstances of your particular situation, as well as the governing laws applicable to your Cooperative and the State you live in.

Please do not leave this class without getting at least one great new idea.  We are committed to making this course well worth your time and the investment made by your Cooperative.  Feel free to ask questions during the class and the break.  We are here to serve you.

A Plethora of Information in the Legal World Affecting Cooperatives

      1. Litigation:
        • A.Why does it take so long? (Anatomy of a lawsuit)
        • B.The new “E Discovery” Rules (Watch what you put in writing – emails and text messages; social media)
        • C.How to improve your chances of winning
          • 1.Creating evidence
          • 2.The need for witnesses
          • 3.Conducting an investigation
        • D.The role of records
          • 1.Record retention policy
          • 2.Where are they? Can you find them?
      2. Dealing with dissident members
      3. Conducting effective board meetings
        • A.Know & bring your bylaws; policies
        • B.Board policy book
        • C.Agenda must be detailed with backup documents
        • D.Motions need to be specific and clear
        • E.Minutes must contain motions
      4. Internal Board issues
        • A.Conflicts of interest
        • B.Confidentiality (“Speaking out of school”)
        • C.Personality conflicts
      5. When to use the Cooperative Attorney
        • A.Penny wise; pound foolish – horror stories
        • B.Duty of Attorney is to Board – not Management
        • C.Selection of Attorney; need to know Cooperative law imperative
        • D.Relating to Attorney – don’t always communicate through Management
      6. How to use the Management Agent
        • A.The contract
          • 1.Review by Cooperative Attorney
          • 2.Terms
        • B.The role
          • 1.Beware the Management Agent that plays attorney
          • 2.Who’s the boss?
          • 3.Experience in Cooperatives imperative
        • C.Performance
          • 1.Clear directives; time deadlines; minutes
          • 2.Performance reviews
      7. Pay attention to your audits
        • A.Financial Audit by your CPA
          • 1.Management Letter (internal controls) Check signers Bank account reconciliations Fraud detection
          • 2.Form 990
        • B.Insurance Audit by your Risk Manager
          • 1.Coverages
            • mold
            • employment
            • practices civil rights
          • 2. Insurance companies are not all alike AM Best rating
            • Claims coverage
      8. Members’ insurance coverages
        • A.Require for hazardous activities
        • B.Contents & liability coverages
      9. Dealing with Contractors
        • A.Horror stories
        • B.Involve the Cooperative Attorney & realize your bargaining position
        • C.Key provisions
          • 1.Length of contract
          • 2.Liquidated damages
          • 3.Insurances
          • 4.Indemnification
          • 5.Early termination
          • 6.Scope of service
          • 7.Timeliness of service
          • 8.Consequences of breach – attorney fees
          • 9.Bonds to assure performance & guarantees
          • 10.Background checks; litigation history
        • D.Standard wrap around contract form from Cooperative
      10. Dealing with employees
        • A.Sexual harassment
        • B.Embezzlement
        • C.Employee manual
        • D.At will
        • E.Renting units to employees
        • F.Shift liability to Management Agent
        • G.Staff involved in politics
        • H.Criminal background checks
        • I.Other sources: social media; financial background
      11. Dealing with members
        • A.Rules (Attorney review)
        • B.Enforcement
        • C.Investigation
        • D.Options to deal with violations
      12. Government relations
        • A.Rental inspection ordinances
        • B.Tax appeals
        • C.Grants
      13. Dealing with applicants for membership
        • A.Screening & discrimination laws
        • B.Orientation of new members to promote sense of community
      14. Corporate law
        • A.Applicability of Open Meetings Act & Freedom of Information Act
        • B.New laws allowing conference calls; trend to use technology
      15. Civil Rights law
        • A.Handicap accommodations
        • B.Fair housing
        • C.Sexual harassment
        • D.Discrimination against protected classes
      16. Updating your governing documents
      17. Unit Vacancies
        • A.Inchoate memberships
        • B.Seller-financing
        • C.Share loans
        • D.Combining 1 bedroom units
        • E.Cooperative financing
      18. The next generation: cultivating future Board members


For more details please feel free to contact an attorney familiar with cooperative housing law.