Most co-op and condo governing documents underscore that self-dealing by board members is prohibited. However, there are some important practices to employ to further prevent any claims of a breach of fiduciary duty, Brick Underground reports.
Annual disclosures about conflicts of interest are legally required under state law. This means the board must prepare a report each year, to be shared with unit-owners or shareholders, disclosing the contracts or transactions in which any board member had an interest. This report will generally be signed by every director and will include the names, addresses amounts and reasons for contracts with vendors or service providers.
“It can be provided to residents each year when the annual financial report is issued,” says Lauren Tobin, an associate at the law firm Woods Lonergan.
About the Author
James Woods is Founder and Managing Partner of Woods Lonergan. He has tried more than 60 jury cases to verdict as first-chair trial counsel and resolves complex commercial and real estate disputes valued at $1M to $100M+ for business owners, principals, and middle-market enterprises across the New York metro area. He appears regularly in the New York Commercial Division and in the federal district courts for the Southern and Eastern Districts of New York, and has argued appeals in the Appellate Division and the Second Circuit.
His practice covers complex commercial litigation, real estate and asset litigation, partnership and shareholder disputes, fiduciary breach and corporate fraud, and cooperative and condominium governance. He counsels corporate and cooperative boards throughout New York. Before founding the firm, he served as an Assistant District Attorney in Nassau County, trying both jury and bench matters.
The Legal 500 has ranked James for Commercial Disputes in its US Elite rankings for New York, and his peers have recognized him with Martindale-Hubbell's AV Preeminent rating. Woods Lonergan is ranked by Chambers Spotlight USA for Litigation: Commercial Disputes and Real Estate. James serves on the American Bar Association Committee for Commercial and Business Litigation, as well as the New York City Bar Association Cooperative and Condominium Bar Committee. His commentary on New York commercial and real estate disputes has been quoted in The New York Times, The Washington Post, Bloomberg Law, Law360, and Forbes.
Disclaimer: The information in this article and blog post (“post”) is provided for informational purposes only, and may not reflect the current law(s) in every jurisdiction. No information contained in this post should be construed as legal advice from Woods Lonergan PLLC or the individual author(s), nor is it intended to be a substitute for legal counsel on any subject matter. Nothing herein shall be construed to create an attorney-client relationship with Woods Lonergan PLLC. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from an attorney licensed in the recipient’s jurisdiction. This post is attorney advertising.
