Q: I used to be contemplating shopping for a co-op with a non-public yard on the Higher East Aspect. The yard was included within the providing plan. The vendor and I agreed on the worth, however then the board launched a licensing settlement that imposed a month-to-month cost to make use of the yard. This payment was equal to 18 shares, although the customer wouldn’t get these shares. The board additionally imposed guidelines concerning how and when the yard might be used. Potential patrons needed to signal the settlement to be thought of. Is it authorized for a board to impose a separate payment for a yard that belongs to the unit?
A: If the yard is a part of the unit, the board can not require you to pay a license payment to make use of it.
“In reality, whether it is a part of the unit, the month-to-month upkeep assessed to the unit would technically cowl the price of the yard, and any extra quantity the board would try to gather from you’ll be tantamount to double-dipping,” stated Leni Morrison Cummins, chair of the condominiums and cooperatives apply at Cozen O’Connor, a Manhattan legislation agency.
It’s doable the board is making an attempt to right a mistake from the previous, that predated the vendor’s occupancy. If the yard shouldn’t be a part of the unit, the co-op might have the suitable to license its use.
However it’s a must to ask why the board is introducing the licensing settlement now.
“It seems like there’s one thing very fishy in regards to the board now requiring a license settlement and fee for the equal of 18 shares value of upkeep,” stated Steven D. Sladkus, a associate at Schwartz Sladkus Reich Greenberg Atlas LLP, a Manhattan legislation agency.
You point out that the yard is included with the house within the providing plan, so the extra probably state of affairs is that the board could also be making an attempt to generate earnings for the cooperative.
The opposite factor to bear in mind is {that a} license, by its nature, may be revoked (although there are irrevocable licenses). Should you had been to signal this license, would the board, in a while, say that truly, you’ll be able to’t use the yard?
“The client goes to say that’s loopy, that’s a deal breaker,” Mr. Sladkus stated.
If potential patrons stroll away, the board could also be failing in its fiduciary duty to the vendor as a shareholder.
Your dealer can ask the vendor’s dealer to hunt extra data from the board about its foundation for imposing the license payment and why it wasn’t charged earlier than.
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