Has the Property Management Company Breached Their Co-op Contract?

A.S. from Fairfield County writes:

Dear Mister Condo,

I moved into a co-op recently. The board hired a new management company. After being unsatisfied with the property manager in place (3 months) the management company suggested we take the receptionist with limited skills and no license/certification as the new property manager. The board agreed for some insane reason and this girl has made it her mission to drive off all of our contractors and service providers to bring in the people the management company uses. There is talk of kickbacks. They have done this on other properties. Every memo, directive, repair or task this girl executes is wrong, mismanaged and just turns out badly. She has offended and outraged a dozen usually nice normal shareholders with her behavior, demands, and stop work orders. She is also the management company owner’s new girlfriend and he obviously wants her on some property. Can she act as property manager with only 1 ten-hour online class and zero experience in construction, property management, facilities, etc.? The contract between the co-op and the management company states we have a property manager, a receptionist and an Acct Exec. They are in default of their contract, correct? Please let us know.

Mister Condo replies:

A.S., you have made a lot of accusations here and, if true, are certainly worth contacting the association’s attorney to discuss. Breaking a management company contract for an association of your size is no simple matter. Just because you claim the management company is in default does not mean that they are. You would need to be prepared to prove it, very likely in court, as the management company would be likely to sue for breaking of the contract. My best advice to you is to speak with the association attorney. As for the Board’s “insane reason” to agree with the management’s company proposal to use a secretary as the property manager, it is time to call them to task for making such a decision. The Board is comprised of elected members. They can be recalled or voted out of office at the next election cycle. People that use “insane reasoning” have no business representing the financial interests of co-op owners. This is very real money of the co-op owners they are spending and protecting. They need to behave like the Board of any business and make decisions that are in the best interest of all shareholders. It would appear to me that they have shown exceptionally poor judgment in this matter. Of course, that also means you need to be ready with a slate of new volunteers to serve on the Board. Without that, this Board may continue to serve the association poorly. In that case, putting the blame on the management company is only half correct. Good luck!

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