Page 1 - CooperatorNews July 2021

June 2021
COOPERATORNEWS.COM
Also in New York State, the Good-Cause Eviction Bill, as it is com-
monly known, is yet another example of tenant protection legislation
that inadvertently includes co-ops—to their disadvantage.
This bill, A5573 in the Assembly, prohibits eviction or removal from
a housing accommodation for anything other than good cause. Attor-
ney Margery Weinstein of law firm Ganfer Shore and Chair of the New
York City Bar Association’s Co-op and Condominium Law Committee
explains that “‘Good cause’ is defined to include nuisance and illegal use
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Co-op and condo living is subject to lots
of rules—some of which come directly from
state laws, some from the building or associa-
tion’s own bylaws, and some from its house
rules. Every state has statutes that govern the
operation of residential communities; every
community also has its own set of govern-
ing documents, which are almost universally
subject to those state laws—and sometimes
go even further than state regulations in de-
lineating what owners and shareholders can
and can’t do on the property.
These various laws, bylaws, and rules gov-
ern everything from pet ownership to leasing
and subletting of individual units, and even
to who may reside in an apartment. But can
a community’s rules conflict with state stat-
utes? And what happens if they do?
Governing Documents
According to Dennis Greenstein, an at-
torney and partner with Seyfarth Shaw, a law
firm based in New York City, “The governing
documents of cooperative corporations—
which are their certificates of incorporation,
bylaws, proprietary leases, and house rules—
and condominiums—which are their dec-
larations and bylaws, and rules and regula-
tions—must comply with the applicable laws
governing them. And unless restricted by
laws or the governing documents, they can
be more stringent than such laws.
“The Business Corporation Law (BCL)
governs co-ops,” Greenstein continues, “and
the courts have applied the BCL in its re-
view relating to whether the decisions and
the actions of the boards of co-ops and con-
dominiums have complied with the laws
and governing documents. In addition, the
New York State Condominium Act governs
condominiums, and provides for specific re-
quirements that must be included in the gov-
erning documents of condominiums, and
followed by their board of managers.”
“A co-op’s governing documents should
As the nation starts to regain a semblance of normalcy with COVID-19 vaccinations on the
rise and restrictions beginning to ease, legislative dockets have filled with bills and proposals
that have ramifications for the co-op, condo, and HOA sector. Here are some of the biggies that
boards, managers, and residents should be aware of.
HSTPA Corrections
Back in July 2019, New York legislators passed the Housing Stability and Tenant Protec-
tion Act (HSTPA), providing a range of protections to residential renters, and enacting certain
limitations on landlords and other types of housing providers. But as with certain other legisla-
tion geared toward tenant protections, the language in the HSTPA “inadvertently” wraps co-op
corporations in with “landlords” and co-op shareholders in with “renters,” since both categories
of housing operate under a leasehold agreement—or so think proponents of Assembly Bill 350/
Senate Bill 5105.
The difference is that rental tenants and landlords are two separate entities, whereas coop-
eratives are run by and for the mutual interest of their shareholder-occupants. As such, HSTPA
has had undesirable effects on cooperatives throughout the state, prompting lawmakers to pro-
pose new legislation that would “correct” the inadvertent inclusion of co-ops. However, that
new legislation got held up at the onset of COVID, leaving co-ops without the ability to, for
example, hold more than a month’s worth of carrying charges in escrow, as a co-op board might
propose for a prospective shareholder whose finances were on the margin, but who would oth-
erwise be deemed a positive addition to the community.
The bill is currently in committee. Co-op lawyers and others throughout the state who live
in, work with, or support co-ops are eager for it to be taken back up, with legal experts arguing
that its passage would clear up a lot of unintended harm in an otherwise benevolent law.
Good Cause Eviction
As of August 9, 2020, all owners of resi-
dential rental properties located in New
York City and built before 1960—including
singles and duplexes—MUST test and in-
spect ALL of their apartment units for lead
within five years of the August 9 start date,
per Local Law 31 of 2020. Owners must have
a lead-based paint inspection completed in
units that had or have a child 5 years of age
or younger currently ‘residing’ at the prop-
erty (per LL64 of 2019, 10 hours or more per
week qualifies as ‘residing’), or moving in
within 12 months of the leaseholder’s move-
in. For those children residing in a property
since August 9, 2020, these units must be in-
spected before August 9 of this year—2021—
or owners risk violation.
These requirements were based on a city
lead-based paint action level of 1.0mg/cm2,
same as the federal lead-based paint action
level. However, NYC incorporated a new
definition of unsafe lead paint levels from
the Department of Health and Mental Hy-
giene’s (DOHMH) regulations into the new-
est amendments to the law, seemingly only
for the purpose of a DOHMH investigation
into elevated blood lead levels. Meaning, a
unit could have been completely and prop-
erly inspected for lead-based paint over the
last 20 years, have a valid and current lead-
based paint HPD exemption
and still be
given a DOHMH violation
if any surfaces in
the unit are found to be at 0.5mg/cm2—and
even if the unit already has an existing and
valid exemption that was issued at 1.0mg/
cm2. Not to mention, at the time these
changes to the law were proposed, there was
no acceptable documentation to support that
the instrumentation used for testing could
even be accurate and precise at these very
low levels, per the federal lead laws.
To Be or Not to Be 0.5mg/cm2
The City also incorporated language into
amendments to LL1 that if or when the fed-
eral government issues a Performance Char-
acteristic Sheet (PCS) for any lead paint de-
tection instrumentation at the 0.5mg/cm2
level, the City can promulgate a change to
the law and
lower the lead-based paint ac-
tion level even further, to 0.5mg/cm2.
In early 2021, HUD issued a PCS for
Legal & Legislative
Roundup
Looking at the Past Year in Law
BY DARCEY GERSTEIN
NYC Lead Paint
Law Update
Stay Abreast of Newer,
Tougher Standards
BY MELISSA GUAGENTI, LEW CORPORATION
Laws vs. Bylaws
Understanding the
Similarities & Differences
BY A. J. SIDRANSKY
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