Q&A: Co-op Rules v. Sponsor Units
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—Board President in Yonkers
A “The tenant/shareholders in a housing cooperative are bound by the proprietary lease, bylaws, rules and regulations,” says Albert Pennisi of the law firm of Pennisi Daniels Norelli in Rego Park, Queens. “A tenant /shareholder (sponsor) must comply with the proprietary lease, bylaws and house rules. However, a tenant/shareholder (sponsor) tenant under the Emergency Tenant Protection Act (ETPA) or rent-stabilized tenants are not tenants of the cooperative and therefore are not bound by the proprietary lease, bylaws and house rules. If a tenant/shareholder (sponsor) tenants under ETPA or rent stabilization violates their house rules, the cooperative must proceed against a tenant/shareholder (sponsor), who then in turn must proceed against its tenant.
“The issue becomes complicated when house rules are promulgated by the cooperative, which the ETPA or rent stabilized tenant does not have to comply with pursuant to his or her lease, (e.g. laws concerning placing rugs on 80 percent of the floors or any other rules of the cooperative, which are not enforceable against the ETPA tenant pursuant to the Department of Housing and Community Renewal regulations)—notwithstanding that the rules may be fair and reasonable decisions of the Board of Directors.
The cooperative should consult with its legal counsel who is familiar with the cooperative’s offering plan, proprietary lease, bylaws, rules and regulations, as well as Department of Housing and Community Renewal regulations with regard to specific rules and regulations and the case and statutory law with regard to the aforesaid rules.
