Q: I represent the prospective purchaser of a cooperative apartment in New York City. My purchaser submitted his board package over two months ago and he has still not been granted an interview by the cooperative board (the “Board”). My purchaser is becoming frustrating and is contemplating cancelling the contract. Is this possible?
A: It depends. Pursuant to paragraph 6.3 of the standard Cooperative Contract of Sale (“the “Contract”), if the Board has not made a decision on the prospective purchaser’s board application on or before the scheduled closing date (as set forth in the Contract), then the closing date will be adjourned for 30 business days for the purposes of obtaining the Board’s consent. If, however, the Board does not provide its consent by the adjourned closing date, then either party may cancel the Contract (provided that the Board does not issue its consent before such notice of cancellation is given). Therefore, if 30 business days have elapsed since the scheduled closing date, and your purchaser has still not been granted an interview, then your purchaser could cancel the Contract.
Important Tip: Every contract, and the facts and circumstances of each individual case, is different. Accordingly, your purchaser should always consult with their respective attorney prior to exercising any of the foregoing rights.
Neil B. Garfinkel
REBNY Broker Counsel
Partner-in-charge of real estate and banking practices at Abrams Garfinkel Margolis Bergson, LLP