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Avoiding the Suite

Real Estate Legality

Lawyers are often the butt of jokes at cocktail parties (a few of them are more truths than jokes), and are often the go-to weapon in shareholder disputes.  Many people believe attorneys to be a reactionary necessity, but a good business person and a well-planned coop board knows that attorneys can provide well suited precautionary defenses.  The purpose of retaining legal representation is to avoid running afoul of the law in day-to-day business. While litigating is sometimes a necessary strategy, it is nearly always a long, costly process.  An association runs the distinct risk of having property values decrease as prospective buyers shy away from investing in a community embroiled in lengthy litigation. On top of that, a potential buyer may have their lenders deny them loans in connection to a building that is the subject to litigation.

Arbitration clauses written into contracts and leases can be a huge time (and money) saver.  Problems over common elements, cases involving elections, improperly held board meetings and failure to provide access to records would be better handled in arbitration, and agreeing to that resolution medium before conflicts can really help calm any heated tempers.  Prearranged agreements with contractors regarding payment terms and completion costs can also prepare coop boards for the possibility of catastrophes.  It is almost always easier to negotiate how your contractor will pay for, or repair mistakes before they happen.

Litigation, while certainly a needed bow in the quiver, should be a final line of defense.  An experienced attorney knows how to head off common building issues before they happen.  Even then, there are steps to take before litigation.  When tempers flare, cooler heads to come to the table.  Often, third parties such as attorneys and arbitrators can resolve conflicts without the need for court intervention.

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