Q In the event that a shareholder has a “dispute” with another shareholder—and claims that many other residents of the building have complained regarding the same issue—but refuses to provide the names of other complainants—how should this be handled? In a co-op aren’t you legally entitled to discuss complaints with other shareholders in order to mediate any problems?
—Shareholder in Manhattan
“On the other hand, it is quite possible that the shareholder’s complaints are legitimate. Regardless of the legitimacy of a complaint, housing courts are reluctant to take any drastic action against one resident merely upon the complaints of another resident. Accordingly, corroboration is the key to either a successful mediation of a dispute, or a successful summary eviction proceeding. Where an allegation is presented that one shareholder is offending a number of other shareholders, we recommend that the managing agent make an independent investigation to question other neighbors to see whether the complaints can be corroborated. The shareholder who claims that there are many other shareholders who have similar complaints may be telling the truth and may merely be honoring a request by his neighbors for anonymity, or may merely be exaggerating the claim.
“Shareholders should be advised of the existence of a qualified privilege in community associations (cooperatives included) whereby, absent actual malice, shareholders are relatively free to discuss issues about other shareholders. If there is corroboration and it is determined that the complaint is an objective violation of the proprietary lease (i.e. violation of pet policy, alteration policy, sublet policy, etc.), then an appropriate warning letter, or the service of a Notice to Cure should be issued. Where one deals with more subjective issues, such as noise or other nuisance, it is recommended as a first step that the violating shareholder and the aggrieved shareholder(s) meet with either representatives of the board, the managing agent and/or the corporation’s attorney with the goal toward arriving at a resolution.
“Since litigation may ultimately prove to be necessary, it is imperative that there be ‘immunity’ in what is said at the meeting, such that anything discussed at the mediation, cannot be used in a litigation. If it is likely that litigation is the path, which will be followed, it is suggested that any mediation be moderated by an outside party. This will eliminate the possibility of an accusation that a party has during the mediation improved its position in any subsequent litigation.”