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The Use of Probation and Conditional Occupancy Agreements in Resolving Litigation

When a cooperative elects to initiate eviction proceedings against a member whose conduct has violated the governing documents - for whatever the reason may be, not every case in a court of law is guaranteed win.  Sometimes key witnesses' testimony will change, sometimes witnesses will refuse to testify (even after issued a subpoena), or unfavorable facts may be unearthed during discovery.  Even if the cooperative has dotted every "i" dotted and crossed every "t," sometimes judges and juries will side with the resident member in an eviction case despite what the law and facts may show.  This is why most civil lawsuits settle. 

 

Most civil lawsuits settle before ever reaching a judge or jury.  A settlement should never be considered a bad outcome, even if it appears that the Member is "winning" by allowing them to have continued occupancy.  However, there are certain ways to settle cases using Probation or Conditional Occupancy Agreements that can actually place the cooperative in a more advantageous position, despite allowing the defendant to retain possession. Although each case is inherently different, there are several pros and cons to Probationary or Conditional Occupancy as a means to settle an eviction or nonpayment case. 

 

Of course, the most obvious con of a probationary or conditional occupancy agreement is that the defaulting member would remain in their unit, perhaps indefinitely or until a subsequent violation.  In severe cases of material violations, settlement is not an option at all.  Additionally, the cooperative's attorneys may have spent considerable time and costs preparing the eviction case as though it was going to proceed to trial.  Furthermore, if a probation period is granted, the cooperative will have to wait and see if the member/defendant commits a violation, and if so, will likely have to file notice with the court and attend another hearing.  Moreover, a violating member may also discuss the contents of a probationary or settlement agreement with other members.  However, this concern can easily be protected by the use of a confidentiality clause, prohibiting the offending member from discussing any term of a settlement with other persons.

 

Despite these cons or concessions, settling an uncertain case by use of a Probation or Conditional Occupancy Agreement benefit the cooperative in the event that any further conduct of the member that violates a Settlement, may result in the ability for the cooperative to regain possession of the unit in an easier fashion.  There are several pros to a well-crafted probationary or conditional occupancy agreement:

 

·      The length and term is negotiable. It can be for months, a year or even more.

·      Their scope can be as broad. It can account for and prohibit more than what the initial eviction action is based on.  For example, if the eviction was based on repeated violations for loud music at night, a well-crafted agreement can also require the member refrain from any other violation of the cooperative's Occupancy Agreement or Rules and Regulations.

·      If the member violates the agreement, the cooperative may be able to get an eviction order, and at times, the order can often be obtained immediately or the same day of the hearing.

·      It can limit the issues for the judge if there is a violation.  If the member violates the probation or conditional occupancy agreement, that can be the only issue for the judge to decide.

·      It can include a waiver of a jury trial or of defenses if violated by the member.  Enforcement and be similar to strict liability.

·      If the case was never about money or payment of carrying charges, a clause requiring the member to continue making timely payments can be included.  Thus, even if the case is about unbecoming behavior, and the member corrects their behavior, the conditional agreement can be enforced if carrying charges are unpaid.

·      It can incorporate all of the cooperative's governing documents, not only the one that the defendant or member violated.

·      Probation agreements have a certain degree of deterrent effect, so it may be all the cooperative needs to stop the unwanted behavior.

·      If problems occur after the probationary period expires, and the member commits a violation warranting eviction, the cooperative will have already attempted to resolve the issues with the member.  This may result in getting a judgment of possession quicker than the initial case.

·      Repayment of some or all of the fines and/or attorney fees can be a condition to the defaulting member's conditional occupancy.

 

Either way, there are numerous ways to place the cooperative in as advantageous position as possible when negotiating terms of a settlement with a probationary or conditional occupancy agreement.  By no means is this a suggestion that they should be used whenever there is some degree of uncertainty on going to trial or if the member and their attorney gives considerable legal resistance to the action.  However, when appropriate, a well-crafted conditional occupancy agreement can place the cooperative in an advantageous position.  After all, what is the goal?  It is to put the defaulting member in compliance, and if they are unwilling or incapable of doing so, they need to find another place to live.

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