Case Notes by

Helene W. Hartig, Hartig Law

First published: Jun 2025
$9M on Ice While Flatiron Condo Fight Heats Up

TAKEAWAY Even before a hotly contested litigation is fully adjudicated, a court may effectively punish a defaulting sponsor by depriving it, for an extended time period, of substantial profits from a sale of one or more of its units. When an inequity or impropriety is suspected, it will also step in and protect a Board of Managers against an allegedly unscrupulous sponsor. To assure a positive result, counsel for a Board of Managers should carefully review the offering plan and relevant documents, and present cogent evidence of a sponsor’s wrongdoing before a trial is scheduled so that the court can direct appropriate, albeit punitive, relief. While a $500,000 undertaking may also seem daunting, it is a small price to pay compared to the risk that sponsors' assets will be prematurely transferred, and/or inaccessible to the condo, making any victory meaningless.

Read full article
First published: Dec 2024
The Do-Over That Didn’t Work

TAKEAWAY A court will not give a defaulting unit owner a free pass and will not allow the revocation of a settlement agreement presumably made in good faith. A “do over” will also not be permitted by a court when, in the “glaring light” of hindsight, a delinquent shareholder changes his mind about a settlement agreement. A promise made by a shareholder to pay an agreed upon monetary amount for the violation of the cooperative’s bylaws and occupancy agreement can be reasonably relied upon by a board of directors. That promise, if broken, can also be the basis for liability and a monetary judgment.

Read full article
First published: Nov 2023
The Vote Must Be Wrong

TAKEAWAY If a board member feels that an election is questionable, he or she would be wise to make sure there are enough facts to back up the claim. It appears that in this case the former board president may have been so aggrieved that she didn’t obtain the board position she wanted that she was willing to spend her time and money, and that of the co-op’s also, to challenge the election outcome without the necessary proof. Unfortunately, lawsuits such as this tend to affect the collegiality of any board, and while it’s unclear why, the decision in this case points out that the president of this board has already resigned.

Read full article