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Newsletter Spring 2000
THE FEDERATION OPENS AN INTERNET CO-OP FORUM

The Federation has started a list server forum. This is a place were you can go on the Internet and exchange ideas experiences and to gather information for you cooperative. It's the Federation's "Co-op Forum" and it's free to join. To subscribe to the "Forum" simply go to the Federation's web site (WWW.FNYHC.ORG); you will see a box about joining. Just follow the instructions and you are part of the "Forum". When someone writes to the forum, you get an email to all those who subscribe. You can answer, give your opinion, or just read the email. The Federation will oversee the "Forum" to ensure that correct answers are being given and the emails are about cooperatives and condominiums. Please join now - and be part of this new exciting experience.

TRADE SHOW AND SEMINAR 2000 TAPES ARE AVAILABLE

Did you come to the Federation's Annual Trade Show and Seminar and missed a session? The Federation has prepared audiocassettes for the seminars listed below. If you want to order a session and your building attended the Federation's Show, you can order any of the seminars listed below for a cost of $60.00 per session. Please note, these audiocassettes are available only to attendees of the show.

THE FOLLOWING ARE AVAILABLE FROM THE FEDERATION:

ATTORNEYS' ROUND TABLE -
Federation Executive Vice President, Al Pennisi.

PROFESSIONAL ROUND TABLE - Our panel of experts, consisting of attorneys, managing agents, accountants, refinancing experts and engineers moderated by Federation president, Greg Carlson.

YOUR CORPORATE DOCUMENTS - Federation Executive Vice President, Al Pennisi.

MANAGEMENT/BOARD RELATIONS - Management Representatives from the Association of Co-op and Condo Managers (ACCM) - Kenneth B. Lovett, Gerard J. Picaso and Michael Jay Wolfe.

BOARD RESPONSIBILITIES - Attorney Stan Dreyer

DISCRIMINATION: WHERE YOU LEAST EXPECT IT - Attorney Howard Schechter

SAFEGUARDING YOUR ASSETS - Accountant Rick Montanye

NATIONAL & LOCAL LEGISLATION - WHAT NATIONAL MEMBERSHIP MEANS TO YOU - National Association of Housing Cooperative's Executive Director, Doug Klein and the Council of New York Cooperatives and Condominium's Executive Director, Mary Ann Rothman.


PET LAW

One of most asked questions to the Federation is regarding the pet law. The Federation's Executive Vice President, Al Pennisi, Esq, has written the following piece to bring our membership up to date.

The pet law expressly covers a tenant who openly and notoriously has harbored a household pet for a period of at least three months following taking possession of a unit, where landlord, who has knowledge of the pet, has failed, within the three month period of harboring, to begin a summary proceeding or action to enforce the lease provision that prohibits the keeping of such a pet.

The pet law was upheld as constitutional in Megalopolis Property Association v. Claude Buvron, AD2d 232, 494 NYS2d 14 (1985). If the landlord does not commence a proceeding to evict within the three month period, the right to do so is deemed waived, Starrett City, Inc. v. Maureen Jace, 137 Misc. 2d 328, 524 NYS2d 130 (1987).

The relevant issue that needs to be addressed here is: What constitutes knowledge of the pet by the landlord?

The most recent case on point is Seward Park Housing Corp. v. Cohen. Defendant was a tenant in an apartment complex containing over 1700 units.

In early September 1996, tenant acquired a dog. Tenant would walk the dog in and out of the building on a regular basis. This was witnessed by building security guards, porters and maintenance staff, and also by neighbors. Landlord did not commence a holdover proceeding until February 1997.

The Civil Court found that the testimony of the tenants and their witness established that the landlord's on-site employees knew of the tenant's open harboring of a dog for over four months prior to the commencement of the holdover proceeding. This was considered to have put landlord on notice of the dog. Because landlord did not commence the proceeding within the three month time period, the trial court found landlord waived the A"no pets"covenant in the lease.

The court of the Appellate Term reversed, finding that the security personnel and maintenance personnel should not be viewed as agents of the landlord. The court stated that the fact that the building staff may have observed the tenant with the dog on premises did not establish that the landlord had knowledge or was on notice. The court also held that the pet law did not cover the tenants in this case, since they harbored the dog for only a short period of time.

What is interesting to note in the above case is the fact that the security and maintenance personnel were independently contracted, and the size of the apartment complex were seen as important factors by the court. I believe if the housing community had been a more closed community, the court may have ruled differently. This issue will no doubt be further litigated in the future.



BOARD MEMBER AND PERSONAL LIABILITY

Recently, the daily newspapers ran an article about a Board President who lost an appeal to have his cooperative indemnify his punitive damages. Punitive damages are rewarded as a punishment for acting in BAD FAITH. Punitive damages are very rare, especially in a cooperative housing environment. In the case Broome v. Biondi, et al, the court founded that the Board President, Biondi, of Beekman Hill House Apartment Corp, acted "intentionally, maliciously, and willfully in violating the civil rights of the Broomes". Thus, the court ordered to have Board President Biondi pay $200,000 in punitive damages. Mr. Biondi commenced an action against the Apartment Corporation seeking indemnification for the punitive damages award. In this case, the court found that, under the Business Corporation Law, Indemnification couldn't be made to a director for their actions.

Remember, this was a punitive damages case. Punitive damages are awarded as a punishment for wrongdoing. Please keep in mind and review with your cooperative attorney, your by-laws about indemnification, your directors liability insurance, and applications not accepted. Again punitive damages are for acting in BAD FAITH, make sure you do not.

NEW MEMBERSHIP SERVICES

A BULK OF THE FEDERATION'S TIME HAS BEEN DEDICATED TO OFFERING OUR MEMBERSHIP SERVICES THAT MAY HELP TO SAVE YOU MONEY OR HELP YOUR BUILDING.

THESE SERVICES ARE AS FOLLOWS:

The Federation's web site is now online in its infancy stage. We will be mailing to all our members, an opportunity to list their building's information at our web site. Right now, the site provides a legal corner, event list with links to other cooperative sites, legislative issues, a question and answer page where you can ask your questions directly to the Federation and the Federation Newsletter. Please visit our site at "FNYHC.ORG", let us know what you think and don't hesitate to ask us questions.

The Federation has signed on to the Durnan Group Managers Workers Compensation Safety Group. One of the line items' on all of our member buildings with staffs is workers compensation insurance. The Federation has been studying different workers compensation insurance providers and has concluded that the Durnan Group best fits the needs of our membership. With discounted premiums up-front and a substantial dividend at the end of the year, this makes the safety group the best deal around. Each claim is investigated thoroughly, which is why this group can offer the best workers compensation package in the state. To find out more information or to sign up, please call the Durnan Group Managers at 1-212-768-9191 and make sure to tell them you are a Federation member.

ELECTRIC DEREGULATION

With all the confusion concerning electric deregulation, a new Energy Service Company (ESCO) is consumer oriented. 1st Rochdale Cooperative is an energy company that is owned by buildings who belong to 1st Rochdale. They are not just an energy provider, as the other ESCO's. Similar to what happens when you belong to a cooperative, there are no investors, so the consumers are the owners. In addition, they will do energy audits on your building to see what can be done to diminish or reduce your demand side electric bill, which will save you kilowatts and money. Now is the time to think about this phase in the deregulation process, which started in April 2000. Start now in preparing your building, talk to all the "ESCO's" and talk to 1st Rochdale, you will be surprised in what you hear. For further information, please call 1st Rochdale at 1-212-673-3900.

DATES TO REMEMBER

Visit the Federation booth at the New York Builder Show June 21 and 22 at the Jacob Javits Center. (See enclosed VIP pass - will let you in for free - please send the form in)

Look for a Town meeting in September in Queens - Special Guests - Details will follow!

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Until further notice please note the changes in both the Federation fax number and the mailing address:
Federation of New York Housing Cooperatives & Condominiums, 61-20 Grand Central Parkway, Suite C1100, Forest Hills, NY 11375, info@fnyhc.co-op, (718) 760-7540 Fax (718) 699-5618