The Real Deal New York

Can menacing condominium owners be forced to sell their apartments?

Lawyers say condo bylaws should include a provision to eject wild, drug-dealing neighbors

September 13, 2012 10:30AM
By Candace Taylor

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Bruce Cholst

For New Yorkers accustomed to living stacked on top of each other, the annoyances of such close quarters — late-night noise, wafting smoke and invasive aromas — are all too familiar. But until now, condo dwellers had few legal remedies for coping with unruly neighbors.

While co-op residents technically lease their apartments and can be evicted, condo boards lack legal standing to remove unit owners, no matter how offensive their behavior may be. But attorneys at the Manhattan law firm of Rosen Livingston & Cholst are trying to change that, in a first-of-its-kind effort to give condo boards “a fighting chance to enforce order in the community,” said attorney Bruce Cholst.

Cholst and Mary Kosmark, both partners at the firm, recently authored an article in the New York Law Journal that proposes a legal method for condo boards to forcibly remove troublesome residents from their buildings. In the article, they proposed that condo boards add an amendment to their building bylaws that would force unit-owners to sell their apartments if, after a written warning, their conduct is deemed “objectionable” by a two-thirds majority of both the board and unit owners.

“If there’s really one chronically bad neighbor who’s constantly violating the rules and offending everybody, it really does poison the well of community life,” Cholst said.

Under the provision, should residents vote to remove an owner, the board has the right to buy, or find a buyer for, the unit at fair market value, as determined by a panel of appraisers.

Cholst began working on the idea about a year ago at the urging of a client, and said he hopes city condo boards will begin adopting the still-untested amendment in the coming months. He said that he’s also urging developers to consider putting such provisions into condo rules before their buildings are occupied to avoid the necessity of residents voting on them.

Still, Cholst’s solution is not to be used lightly: He said he envisions these mechanisms — which would apply to future buyers, not existing unit owners — being used only for “really major, chronic infractions, like drug-dealing, constant wild parties, lewdness or abuse of building staff.”

Cholst and other attorneys said they’ve heard about a growing number complaints like these from clients, in the wake of the mid-2000s condo boom. Almost all newly constructed buildings are now condos, unlike in decades past, when co-ops were the predominant form of home ownership in New York City.

Because co-op residents are technically ‘tenant-shareholders,’ not owners, the co-op board can use what’s known as a “Pullman proceeding” to evict residents for illicit activity, breaking the building’s rules, or chronic “objectionable conduct.” (That right was upheld by the Court of Appeals in 2003, in the case of 40 West 67th Street v. Pullman.) Condos, by contrast, are real property, and boards have “absolutely no power of eviction,” Cholst explained.

If a condo owner (or an owner’s tenant) breaks the rules or annoys other residents, the board can levy fines or go to court to get an injunction, but those options can be “expensive and drawn-out,” said Belkin Burden Wenig & Goldman attorney Aaron Shmulewitz, who represents some 250 co-op and condo boards in New York.

At the end of the day, in Cholst’s opinion, “the rules can’t be practically enforced.” As a result, he said, condos have a reputation for being “much wilder than co-ops.”

Cholst and other attorneys acknowledged, however, that the proposed remedy has a long way to go before becoming widely used. In order for condo boards to start relying on these rules, they would need to be tested in court, which could take years, Shmulewitz said.

Still, the bylaws amendment has a good chance of being upheld by the courts, according to Shmulewitz. “It is likely legally enforceable,” he said.

Attorney Steven Sladkus, of Wolf Haldenstein Adler Freeman & Herz, agreed that the courts would likely uphold Cholst’s provision, “as long as it has been duly authorized and approved by a super majority of the unit owners.”

But that’s the rub. Sladkus and others pointed out that it would be very difficult to get building owners to agree to add such an amendment to their bylaws, and then to vote to expel a troublesome resident. “I personally would be very surprised if any condominium were able to get the requisite votes to pass that,” he said.

Or, as Shmulewitz put it, “it’s generally pretty difficult to get two-thirds of the unit owners to agree on anything.”

And sponsors, at least at first, would be unlikely to incorporate such provisions into the bylaws of new buildings because it could “narrow the buyer pool,” Sladkus noted.

After all, many buyers are attracted to condos in the first place because they lack many of the restrictions of co-ops, Sladkus said.

“People enjoy the freedom of condominium ownership,” he said. “They don’t like the tyrannical rule that some cooperative boards take advantage of in asserting Pullman-type measures to kick out unruly residents.”

Cholst said that there is “ample precedent” for the provision, but acknowledged the challenges.“The toughest part of all [would be] getting the court to accept the idea of forcing somebody to surrender his property,” he said.

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