Co-op Corporation Rejected Shareholder Tenant's Proposed Sale

October 18, 2015

LVT Number: #26540

Shareholder tenant sued landlord cooperative corporation, the co-op board, and individual board members, for breach of fiduciary duty after the co-op board decided not to approve tenant’s proposed sale of his apartment. The court denied landlord’s request to dismiss the case without a trial. Landlord appealed and won. The appeals court found that the business judgment rule protected landlord’s decision. Also, to date, tenant hadn’t obtained a potential buyer who was fiscally responsible or who had offered the minimally acceptable sum for the apartment.

Shareholder tenant sued landlord cooperative corporation, the co-op board, and individual board members, for breach of fiduciary duty after the co-op board decided not to approve tenant’s proposed sale of his apartment. The court denied landlord’s request to dismiss the case without a trial. Landlord appealed and won. The appeals court found that the business judgment rule protected landlord’s decision. Also, to date, tenant hadn’t obtained a potential buyer who was fiscally responsible or who had offered the minimally acceptable sum for the apartment. So there was no controversy to decide.

 

 

Buccellato v. High View Estates Owners, Corp.: 2015 NY Slip Op 06703, 2015 WL 5125529 (App. Div. 2 Dept.; 9/2/15; Mastro, JP, Balkin, Chambers, Maltese, JJ)

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