The Eviction Playbook: How Boards Can Legally Handle Problematic Residents

Intolerable behavior is everyone’s nightmare, and solving the problem first falls in the lap of a co-op or condo board. Often this is tossed to the building’s attorney or managing agent because the solution is painful, relentless and full of legal potholes. In this interview Justin Buchel, partner at Schneider Buchel, tackles what happens when objectionable conduct is addressed head on. From documenting evidence and issuing formal notices to conducting proper hearings and potential lease termination, he outlines the legal pathway that protects boards while addressing problematic residents. Habitat’s Carol Ott conducts the interview.

The business of running a building is demanding work that requires making endless decisions — some that can quickly lead your board into a quagmire of legal difficulties. Legal Talk interviews New York's leading co-op/condo attorneys to find solutions, and get some guidance, on these challenges. For more co-op and condo insights, sign up to receive Habitat's free newsletters or become a Habitat subscriber today!

Transcript

[00:00:00] Carol Ott: Welcome to Legal Talk, a conversation about governance issues that New York's co-op and condo boards are tackling today. I'm Carol Lott with Habitat, the New York City magazine for co-op and condo board directors, and my guest today is Justin Buchel, partner at the law firm, Schneider Buchel. 

Getting along with your neighbors is key when living in a co-op community, but sometimes things go off the rails. In a co-op when someone's behavior becomes intolerable, it's called objectionable conduct. Justin, what can a board do to address this behavior? 

[00:00:37] Justin Buchel: The primary thing that every board must do if there are situations involving objectionable conduct on the part of a shareholder or someone living in the shareholder's unit, is to begin to document that evidence, begin to assemble a paper, trail, videos, audio, and request any witnesses, which could include building staff, provide evidence so the board can review everything and make a determination whether there is truly objectionable conduct occurring.

[00:01:01] Carol Ott: So let's say we have a shareholder who I don't know is making a lot of noise or roaming the hallways, or perhaps going into the common areas in doing something which is making everybody uncomfortable or making the staff uncomfortable. If the building does have a staff, does the board send out an alert to everybody and say, we think we have an issue with this particular shareholder. We need everybody to document what might be happening. Is that how this works? 

[00:01:32] Justin Buchel: Typically, objectionable conduct cases are not that vast in terms of impacting an entire building, although I do have cases like that and I can give you two examples.

Most cases involve a resident or shareholder causing an issue that's really impacting either their hallway in an apartment building or maybe the apartment below or above. So when that's happening, we're probably going to reach out to every party that's a witness or adjacent to the unit at issue.

And just reach out to them directly. We typically would not wanna reach out to the entire building and make it an everybody against one person, type of situation. We'll typically just recommend to those who are the complaining witnesses. And again, that sometimes includes, building staff.

It could be door people, it could be maintenance staff, porters like that. And tell everybody please collect, collect your evidence to the best you can. Photos. Videos. The great thing about today, which is different than it used to be, is that everybody's walking around with their cell phone camera in their pocket, which makes it a lot easier to assemble evidence for these types of cases.

And there are other situations where the person is a total disruption to the building. And in those cases where sometimes that spills into the lobby or to an another common area, the gym or a pool or other type of party room that a building might have. When there are that many witnesses, then in those cases then we would be probably contacting, everybody to start to assemble the evidence.

[00:02:54] Carol Ott: So I'm just gonna go back to this question. Let's say there's a shareholder who is bothering his or her neighbors, and I presume the neighbors have complained to the board or to the management company. At some point, the board has to say to the people who were being offended, all right, I need your help in documenting what's going on. When is that point? Has the board already reached a decision, it's going to try and prove that this person has objectionable content. How does that sort of work? 

[00:03:29] Justin Buchel: Yeah, I think it works the way you said: it's a help us help you. So when someone who's complaining about a neighbor or is a witness to objection conduct in a cooperative building, they might report it to the board and they say, board, this is terrible. You gotta do something. Or it's your job to enforce the rules. It's your job to enforce the proprietary lease. You gotta help us. And then our response is typically, help us help you and the way you can help us help you is providing evidence.

So when you're experiencing one of these outbursts, noise, other types of behavioral issue harassment, please try to document it to the best of your ability, to the extent you can capture it on your cell phone, either video or audio. Please do that. Otherwise, witnesses logs, descriptions to the best of your ability. And then the board's role is to review that evidence and decide whether or not there's a true violation.

I do think it's very important that boards don't pick sides in a neighbor to neighbor dispute and believe one side, just because one side is saying it's happening. And to really request the documentary evidence. That way the board can rely on its business judgment rule decision making power, and make a decision. 

[00:04:35] Carol Ott: So now this has happened and the people who are having the difficulty have documented it for, I guess a period of time, and they go to the board and they say, here's my documentation. So what's the next step for the board? 

[00:04:50] Justin Buchel: Many boards will give it right to legal counsel, and the first step would be pairing a formal default notice under the proprietary lease, documenting to the shareholder that this has happened, there has been evidence that this is happening and then must cease. And if it doesn't cease, then the board's gonna have no alternative other than take the necessary steps to terminate the shareholder's proprietary release and then commence eviction proceedings. And again, it will depend on the particular co-ops governing documents, if we're going to go down a, an objectional conduct path, what the process is, how much cure. Typically, these paragraphs don't require any cure. Most objectional conduct provisions in a co-op's proprietary release just say that the conduct must be repeated after written notice.

As long as it happens again, there's no window that it must be within 30 days or 60 days or anything of that sort. It's just that it's repeated after written notice. That phrasing is used in almost every co-ops governing documents. 

[00:05:49] Carol Ott: So let's say it is repeated and now what does the board do?

What's the next step? Do they have a meeting? Do they decide, we're gonna get rid of this person? How does that work? 

[00:05:59] Justin Buchel: Proprietary leases, when we're looking at objectionable conduct, which is different than other parts of the lease that allow the board to terminate the proprietary lease, there's a provision of the proprietary lease regarding nonpayment.

There's for legal sublet, or there's just general breach of the lease. There are different ways to terminate a lease under those provisions. But if we're going to objectional conduct, most co-ops proprietary lease have a provision that says the board, after a meeting of the board, can hold a hearing essentially and make a decision whether or not the shareholder's tenancy is deemed undesirable.

Now I wanna say most, there are other co-ops that do require a shareholder vote. So the typical language in a co-op's proprietary lease talks about if objectional conduct is repeated after written notice, the board on a vote of either a majority or two thirds of the board can decide that the shareholders tenancy is und esirable, and therefore proceed with termination.

There are some co-ops out there that do require a shareholder vote. So again, when we're talking about, we have to have a meeting to decide whether the shareholder's lease is gonna be terminated, it will either be a board vote, which is more common, or a shareholder vote, which is less common. And there's even a hybrid where it's required to have a board vote and a shareholder vote.

[00:07:13] Carol Ott: So let's say the vote happens, 

[00:07:15] Justin Buchel: then what? 

Just so we're on the same page, the vote is a hearing. It's hearing by the board where we have invite the shareholder who's at stake of having their proprietary release terminated and evicted. They're invited to the meeting and it's a hearing.

Both sides prevent hearing. We recommend having a court reporter, so there's a transcript of exactly what's happening. There's interviews, there's witness testimony, and the board or the shareholders serve as judge and jury in that case and decide whether or not there's enough evidence that deems that the shareholder's tenancy is undesirable based on their repeated objectional conduct.

So if the board or the shareholders make that decision and vote yes, the shareholder's tenancy is undesirable, we're proceeding with termination. Then the next step is you file for eviction in landlord tenant court. 

[00:08:03] Carol Ott: And I'm presuming that you could file for eviction. How long does that take and is that really gonna evict the person?

[00:08:13] Justin Buchel: Yeah, typical landlord tenant proceedings could take anywhere in today's day and age between three and six months to play out. But the unique part about proceeding under objectionable conduct in a co-ops proprietary lease is that we have been very successful and once we commence the action filing an immediate motion for summary judgment.

This is because the case law on this topic has said, and there's the famous case called the Pullman case, and sometimes many cooperatives refer to these matters as a Pullman hearing, meaning that the shareholder or board vote as a Pullman hearing. Because the case law states that as long as the board followed all the legal steps in the proprietary lease, meaning served the prerequisite notices, conducted the hearing properly, then made a proper vote that's not biased on discrimination or retaliation or anything, and it's a good faith decision to terminate the shareholder's proprietary lease, the court is not supposed to put its opinion about whether or not this shareholder's lease should be terminated in place of the boards and should be holding the board's decision based on the business judgment rule, and then granting summary judgment based on that. So because of that, even though landlord tenant cases have been known to take a long time, especially in the post covid era, by filing for summary judgment immediately on commencing the action, we have seen these cases speed up and good decisions reached very quickly. 

[00:09:40] Carol Ott: And then if the decision is reached that the lease is gonna be terminated and the shareholder has to leave, how does that happen?

[00:09:49] Justin Buchel: So if the court grants the motion for summary judgment and the relief we're seeking in every landlord tenant proceeding is asking for a judgment of possession and a warrant of eviction to be issued by the court. Once that happens, then the court's going to issue the eviction warrant and that's gonna be given to the marshal or the sheriff, depending on which county we're in.

And it's up to the marshal, the sheriff, to complete the eviction. They serve a notice on the shareholder's door telling them, have to get, and the eviction is pending. And the unfortunate thing that happens is if the person doesn't get out, then they're forcibly removed from the property. But I can tell you that in my experience, I would say almost 80% of these cases don't end in that moment. They don't end with a forcible eviction from the property by the marshal or the sheriff. Most of these cases if there is competent counsel representing the shareholder, they see it coming from a mile away. They know the case law, they know the board's decision making power is going to be upheld.

So in almost all of these cases, there is usually a settlement where we give the shareholder time to relocate. They realize they're gonna lose their investment, they're gonna lose their apartment, and it's more beneficial to relocate than to litigate a losing case. 

[00:11:03] Carol Ott: And how often do you see boards failing to follow the right procedures?

And if so, what are the most common mistakes that would jeopardize a case? 

[00:11:13] Justin Buchel: The most common mistake is to not follow all the requisite notice requirements in the proprietary release, in bylaws. And the bylaws typically don't come into play. In a landlord tenant proceeding in a cooperative 'cause it's more for corporate governance, but they do come into play because there are special meetings of the board or the shareholders that need to be held.

So proper notice requirements have to be sent, giving enough time for that notice, serving notice in the proper way, making sure it's certified mail or registered mail or both or some other requirement in the notice requirements of the governing documents. Holding a proper hearing, having a court reporter at that hearing, so there could be no question about what took place at that hearing.

Then, if you follow all the proper protocols in the co-op's governing documents and make a good face decision that the shareholder's lease should be terminated, the courts are supposed to uphold the motion for summary judgment and give the board the relief they're requiring. So as long as the board's following the protocols, following the governing documents, it should be what I call a slam dunk case. But it's really important to make sure that the attorney handling the matter knows this area of law, knows how to handle these types of matters, so there is nothing that could cause the co-op to lose on a technicality.

[00:12:24] Carol Ott: So lemme just ask, from your experience, from the time the board has asked the people who are being impacted by the troublesome behavior, from that time to the time that the person moves out, how long are we talking about? And this is after Covid? 

[00:12:43] Justin Buchel: Yeah, post Covid, sometimes it depends on the response because there are some shareholders when they're served with these notices, they double down, they triple down. They say, I didn't do this. You can't stop me. I'm gonna do this even more. Their noise or their harassment or their conduct gets even worse and they fight you every step of the way.

We go to court and they fight us every step of the way, and they hire attorneys who are filing motions to dismiss and trying to muddy up the waters. And in those cases it could take a lot longer and the whole process definitely could take about a year to play out. And we've been very successful even when that happens, defeating those motions to dismiss, defeating any attempts to double down and triple down on their conduct and turn it around on the board. But in my experience, most of these cases, if there's competent counsel representing the family, they should be able to guide them that this is a losing battle.

Once the board has made this decision that the lease should be terminated based on objectional conduct and provided there's good faith rationale for the board making that decision, a competent attorney will guide the shareholder, this is a losing case. Collect your asset that you have left and make a deal and get out.

And in those cases, we normally can settle the cases, giving the shareholder somewhere between three and six months to relocate. And so the matter can play out a lot quicker than a full landlord tenant proceeding. 

[00:14:07] Carol Ott: Okay. Thank you very much. This has been really insightful. And hopefully most boards don't have to walk down this lane of dealing with somebody.

[00:14:17] Justin Buchel: I agree. I think it would be it's a big deal. It's a big moment in every co-op's matter. And I like to say that there's usually that one problem shareholder. Hopefully you don't have to escalate to this step, but it's good for co-ops to know that if they do have that one problem shareholder and they can't resolve it amicably, it can't be resolved with mediation or just friendly dialogue, but they do have an option.

[00:14:38] Carol Ott: Terrific. Thanks so much. 

[00:14:40] Justin Buchel: Thank you. Appreciate it.