Page 7 - New Jersey Cooperator February 2019
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NJCOOPERATOR.COM THE NEW JERSEY COOPERATOR — FEBRUARY 2019 7 limit future maintenance increases.” Diff erent states have diff erent laws con- cerning how information can be distrib- uted to condo or co-op residents; some allow for electronic communications, and some require actual hard copies to be sent via registered mail or to be hand delivered. Regardless of the rules where you live, it’s important to note that impersonal meth- ods of outreach – like email – should not be a substitute for actually interacting with constituents in person. “Email should not be used to eliminate or avoid discussion at board meetings,” warns Allison L. Hertz, a senior associate with Kaye Bender Rembaum, a law fi rm that has offi ces in Pompano Beach and Palm Beach Gardens, Florida. “In most cir- cumstances, board meetings are required to be open to members \[so\] the members of the association are able to hear how the board makes its decisions. “Th at said,” she continues, “meeting minutes should be minutes. Th ey should not be a transcription of the entire meeting. Such a document could be used against the association and could result in association liability.” Even when withholding some informa- tion from unit owners seems like the pru- dent thing to do, a board should still con- sider how owners may react to the basic idea of being left out of the loop. Moriarty recalls one instance in the middle of a con- struction defect litigation: “A group of unit owners were demanding the release of the board’s expert engineering report. On ad- vice of counsel, and to preserve privilege, the report – which had been prepared in anticipation of litigation with the developer – was not disclosed. Th e board didn’t with- hold the report to keep it from the owners; it was withheld to keep it from the develop- er and other defendants in the lawsuit. Th is was a perfectly reasonable decision, and it could have been easily communicated to unit owners, but it was not. Because of this, a group of unit owners actually started to “Homeowners have a right to know where their money is going and, when a board keeps its owners informed, it keeps them calm.” — Chip Hoever No matter what your size… You will always fit at Denali! With decades of experience, our team of experts is committed to Request a Quote today! 1uest a Quote today! 1-uest a Quote today! 1-888888-888-315315-315-7773 7773 uest a Quote today! 1uest a Quote today! 1uest a Quote today! 1 Req Req Req Req Req www.denalipm.com ww.denalipm.com ww.denalipm.com w w Highrise Condos, Town Homes, Adult Communities, HOAs, Brownstones, Multi-Family Superior Service Financial Transparency Rigorous Collections Communication Website Technology Capital Project Planning Online Payments Live Customer Service act against the interests of the association with regard to the report, simply because they did not understand the reason why the board was withholding it. Th is resulted in months of confl ict, acrimony, and cost.” “Even fairly minor changes, like alter- ing the hours of the laundry room, can create issues for some residents,” adds Ax- inn. “Any change in policy should fi rst be fully disclosed in a memorandum to all the shareholders at least 30 days before it goes into eff ect.” The Perils of Oversharing Of course, there is a point at which re- vealing too much information to residents can be detrimental (or just overwhelming), and as such it needs to be withheld for the greater good. A board must know how to walk this delicate line. “In addition to instances where infor- mation cannot be disclosed because of privilege or legal prohibition, there are times when specifi c information cannot be conveyed,” says Moriarty. “For instance, if the board were in the middle of negotiating continued on page 20
