Page 7 - New England Condominium May 2022

NEWENGLANDCONDO.COM NEW ENGLAND CONDOMINIUM -MAY 2022 7 larly careful with respect to arrearages danger of physical harm, and the board them from claims, and not be indemni- and health issues. Guarding personal in- formation is as important as community there could be financial problems due have covered them under their directors munity. At the same time, it is the board’s transparency, and the line between them, to a theft by a board member or agent and officers and other insurance. In such and management’s responsibility to han- while thin, must be absolute. If residents feel their board is too se- cretive or unresponsive, Wolf says they vere risk; there could be a gas leak or a tion provisions of the bylaws of the co- should articulate those concerns to their similar dangerous condition that is be- management. “We will try to resolve the ing concealed—if the board members are would include not covering fines, pen- problem. If not, owners can reach out to found to have committed acts which are alties, and legal expenses for findings of the board directly. If it’s still unresolved, deemed to be exclusions under the build- we will outline to the residents how to ing’s insurance policies, they likely will change the board. We tell them to run be denied insurance coverage to defend tive communication is the best policy for for the board. If you don’t like the board, vote them out.” A truly problematic or negligent board may also find itself out of a manager; “Frankly,” says Wolf, “I will terminate the contract if a board is too difficult.” Legal Considerations The communication pitfalls board members and associations or corpora- tions may stumble into vary state by state, and governing document by governing document. For example, according to El- len Shapiro, a partner with Marcus, Erri- co, Emmer & Brooks, a law firm based in Braintree, Massachusetts, “There aren’t any requirements for regular commu- nication under Massachusetts law, but there is a requirement that upon request, certain accounting documents must be communicated by the board to the resi- dents. A copy of financial reports shall be made available. It might be an affir- mative obligation to send it out, but my opinion is that the resident must request it. There is a provision that a CPA review statements in properties of more than 50 units. The penalty attached to failure to concur with this provision is reasonable attorney’s fees.” Dennis Greenstein, a partner with the Manhattan offices of law firm Seyfarth Shaw, cautions clients to be on the look- out for potential communication prob- lem areas. “If there is an unsafe condi- tion, for example, such as construction defects that could put the residents in chooses not to disclose or fully disclose; fied under policies that otherwise would parency leads to a more cohesive com- of the building which has put the coop- erative, condominium, or HOA at se- event, the board members also would dle sensitive information correctly both likely not be covered by the indemnifica- operative, condominium, or HOA. This such breaches of law.” In the broader picture, clear and effec- co-op and condominium boards. Trans- for the sake of the community as a whole and the individual residents. n A J Sidransky is a staff writer/reporter for New England Condominium, and a pub- lished novelist. He can be reached at alan@ yrinc.com. “There’s simply not enough activity that needs to be disseminated to the shareholders or unit owners 12 or even six times a year.” — Zach Kestenbaum