The State of Cooperative and Condominium Law in 2015 | New York Law Journal

The State of Cooperative and Condominium Law in 2015 | New York Law Journal



Here's one interesting change in application of the business judgment rule. Even if the owner can show favoritism by the board of directors, they have to prove prejudice to their interests as a result of the favoritism



"In South Tower Residential Board of Mgrs. of Time Warner Center Condominium v. The Ann Holdings,6 the First Department subtly adjusts the standard for self-interest on the board. The court wrote, "However, even if, arguendo, plaintiff engaged in some favoritism…, defendant failed to show prejudice therefrom." This is a clear carve out from previous doctrine, but it leaves unclear whether a challenge to a board for violation of the business judgment rule requires showing for any violation that there is both a violation and resultant prejudice."