New York Cooperative & Condo Board of Directors' Attorney
Cooperative and condominium apartment buildings in New York City are complex business entities with many legal needs. Choosing the right New York condo representation attorney and avoiding excessive law firm fees are critical factors in operating in a cost-efficient manner.
Without careful monitoring, legal expenses can get out of hand. In keeping with the Ferziger law firm's approach of providing excellent residential real estate service with an emphasis on cost control, here are seven practical tips to utilizing your lawyer in the most productive way possible.
Seven Keys to Cost-Effective Legal Representation in NYC Co-op or Condo Buildings
Use legal services strategically. There are a number of points to consider in using your lawyer's services in the most intelligent, efficient manner.
First, prevention of problems in the first place is superior to attempting to solve them later. As an example, for certain critical decisions with legal implications that might generate internal dispute, you may want to have your law firm prepare an opinion letter. This can have the effect of shielding members of the Board of Directors from personal liability, because the decision was made with the advice of counsel.
Of course, you will want to use opinion letters wisely. They can be expensive due to the amount of research involved. Explore options with your attorney – sometimes an opinion letter may not be necessary and an alternative approach will suffice.
By far the most expensive legal costs involve litigation. Here are several other suggestions for avoiding association disputes that lead to unnecessary court battles…
Don't sell to litigious individuals. A major source of legal expense often derives from defending against lawsuits initiated by shareholders and unit owners against the Board of Directors. A highly effective deterrent against this cost is simple: don't let litigation-prone individuals into the building. A thorough background check by a professional investigation firm can reveal a potential occupant's history of legal action, as a tenant, shareholder or unit owner.
Condos have a harder time excluding probable troublemakers. Recently though, some condominium associations have exercised greater vigilance in accepting potential purchasers.
Know your limits. Board members should become generally familiar with what they legally can and cannot do. Your attorney can provide you with overall guidelines. This basic working knowledge is a protection against making decisions that may later come back to haunt you.
Each Board member should know what the building's governing documents say. You need a fundamental sense of potential legal implications if you're going to carry out building responsibilities effectively.
Explain why. Keeping shareholders and unit owners informed about decisions made, how they were reached, and detailing why a particular course of action was chosen, reduces the likelihood of disputes. People who have a stake like to be kept in the loop. When they understand specifically why you're doing what you've decided, they're less likely to fight with it, if the action is reasonable and well thought out.
Talk to people individually, have meetings they can attend, and send out updates, newsletters and other informative correspondence.
The personal touch. If there's a potential legal problem with an individual shareholder or unit owner, or anyone else connected to the building, such as a vendor or commercial tenant, speak with them first. Don't be so quick to send a lawyer's letter or court notices.
It's better to have a building manager or managing agent attempt to work out difficulties, rather than pursue an approach that is more likely to lead to expensive litigation. Start by being nice – as basic and as obvious as that may sound, it can save you a lot of money. Save the lawyers for later, if you can't make any headway in settling the matter amicably.
Who loses pays. Requiring a losing litigant to pay the prevailing party's legal fees can go a long way toward making people think twice about initiating a lawsuit. Once again, your attorney can advise you about adding special language to building documents that makes payment of attorneys' fees in litigated matters mandatory.
With vendors, payment of attorneys' fees is established by contract provision, which can be added to those agreements.
- Mandatory mediation and arbitration. Mediation and arbitration can be faster, far more cost-effective approaches to resolving disputes than court battles. Consult your lawyer about amending the building's governing documents to require these options.
New York City is an expensive environment in which to run a building. Legal costs are often a more significant expense than they may need to be. If you follow these suggestions, you may be able to economize on your building legal expenditures substantially, and still maintain the necessary level of attorney guidance you require.
For legal assistance with your building's Board of Director operations, please contact the Law Office of Rubin Ferziger today at 212-490-8585.