Co-ops and Condominiums

In an action by former co-op shareholders alleging that the co-op corporation had engaged in housing discrimination and had acted outside the scope of its authority, the co-op corporation appealed from Supreme Court's denial of its motion to dismiss. The Appellate Division reversed and dismissed holding that shareholders' conclusory allegations were insufficient to survive a motion to dismiss.

Plaintiff shareholders had been engaged in noise disputes with occupants of a neighboring apartment. After unsuccessful attempts to mediate the dispute, the co-op board voted to terminate plaintiff shareholder's lease and brought eviction proceedings. Shareholders moved out, sold their shares, and brought this action alleging discrimination against them for having children, acting in bad faith, and exceeding the scope of their authority. Supreme Court denied the co-op corporation's motion to dismiss, and the corporation appealed.