Provides for the appeal of disputes between shareholders and boards of directors of residential cooperative corporations to a hearing officer appointed by the attorney general

BILL NUMBER:S7259

Title of bill

An act to amend the cooperative corporations law and the executive law, in relation to providing for the resolution of disputes between the board of directors of residential cooperative corporations and a shareholder to be determined by a hearing officer appointed by the attorney general

Purpose

To provide for the appeal of disputes between shareholders and boards of directors of residential cooperative corporations to a neutral hearing officer appointed by the attorney general.

Summary of provisions

Section 1 of the bill adds a new section 78 to the cooperative corporations law to provide that a shareholder in a cooperative corporation which owns residential real property may appeal any decision by such corporation's board of directors to a hearing officer appointed by the attorney general. This section further provides that a hearing upon appeal shall be heard within sixty days, and that the hearing officer shall provide each party an opportunity to be heard and render final determination based on the evidence and testimony presented at the hearing.

Section 2 amends executive law §63 by adding a new subdivision 16 to require that the Attorney General establish an appeals process for the determination of disputes between shareholders and the boards of directors of cooperative corporations.

Section 3 provides the effective date.

Justification

There have been numerous complaints by shareholders of cooperative corporations recently in connection with unreasonable actions taken by cooperative boards of directors. Presently, shareholders are bound by the decision of the board without a right to appeal to a neutral party. This bill would correct this situation by providing shareholders with an opportunity to appeal a determination of the board to a neutral hearing officer appointed by the attorney general.

Legislative history

New bill.

Fiscal implications

To be determined.

Effective date

This act shall take effect immediately, except that section one of this act shall take effect on the first of January next succeeding the date on which it shall have become a law.