The cooperative at 118 East 60th Street in Manhattan got lucky. Its books and records including alteration records were maintained at its management firm’s office – Matthew Adam Properties. When sued, the cooperative and management was demanded to turn over alteration records but was unable to do so because of water damage at management’s office. The other reason raised was a 7 year document retention policy which the cooperative and management claimed was followed and thus the requested records were no longer available.
Plaintiff’s counsel argued that the cooperative and management, including the individual board members named as defendants, spoiled the evidence and thus, they should be sanctioned in the suit. The Court refused to do so based upon the photos of the water damage that management presented along with what the Court considered a reasonable document retention policy which it had no reason to believe was not followed.
This is all fine for this lawsuit, but what about all the other books and records that were destroyed by the water damage. Maybe some of those books and records were needed by the cooperative and not having them safe kept from such casualty was a bad idea. In today’s digital age, digitizing documents is easy and if property maintained, can withstand casualty. Once the records are in electronic form, they can be maintained (and proven to be maintained) in accordance with a document retention policy.
The Court in the the 118 East 60th Owners Inc. case didn’t speak about individual board member records regarding alteration decisions. Perhaps plaintiff’s counsel did not go after the individual records just yet. In many cases, board members inadvisably use personal email to conduct board business including alteration and other decisions by the board. Maybe the destroyed records are located in the emails. If the cooperative had an electronic office like and Office of the Board (www.officeoftheboard.com), all of those records would be contained in the Office and all of them could have been either maintained to withstand casualty and/or purged and gone forever as a part of a document retention policy. Stay tuned on the lawsuit, there are probably appeals and future decisions to come. Read the decision here.
