Council of New York Cooperatives & Condominiums
Article Archive
Financial Issues

Publication Date: Winter 1997


CNYC has long recommended that member cooperatives and condominiums have their attorneys carefully review even the most routine of contracts before they are signed. Your commitment to this consistent practice of review may save you a great deal of aggravation and money. By reviewing documents, your attorney may be able to find and eliminate certain unacceptable clauses that are often found in contracts, and which may look just fine to the untrained reviewer.

When a service provider presents your cooperative with a contract, you can be sure that the attorneys for that company have carefully constructed it to provide maximum protection for their client. Your own lawyer will ferret out onerous provisions and help you negotiate their removal or modification.

For example, some laundry companies offer contracts that include provisions granting the company the right of first refusal for successor contracts when this contract expires. Simply stated, this will make it extremely difficult for you to change service providers at the end of the contract. You should strike this provision from any contract that you are offered.

Similarly, when a contract is not for a fixed amount, it opens the possibility of additional fees for materials, hours, work changes, copying, messengers, faxes and so on. Your attorney will help you either eliminate this opportunity or refine the circumstances under which there would be additional charges.

A consistent practice of professional review of every contract will save you unpleasant surprises both small and large.


In reviewing the insurance for your building, you will want to be certain that you have protected your property well against potentially costly and distressing surprises. One area to be sure to ask about is your coverage against lead paint hazards. In some instances, when policies are silent on the issue, insurers have refused to cover claims made for lead-based paint problems, stating that this is excluded in a clause excluding so-called "environmental hazards."

Some carriers will specifically include lead-based paint hazards within their coverage; others will sell you an additional policy to protect your building.

During the next 10 months, CNYC will be reviewing insurance issues and compiling an insurance checklist, which will be distributed to members in the autumn Newsletter. We welcome your suggestions as our research progresses.


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