There are over 30,000 registered sex offenders living in New York state. New York State Division of Criminal Justice Services, Registered Sex Offenders by County (July 5, 2018). The law provides a framework for assimilating convicted sex offenders back into society, although it is not without criticism. See, e.g., Kelly K. Bonnar-Kidd, Sexual offender laws and prevention of sexual violence or recidivism, American Journal of Public Health, vol. 100,3, 412-19 (2010); Kate Hynes, The Cost of Fear: An Analysis of Sex Offender Registration, Community Notification, and Civil Commitment Laws in the United States and the United Kingdom, 2 Penn. St. J.L. & Int'l Aff. 351 (2013).

But what, if anything, is the obligation of a board of a condominium or cooperative when a convicted sex offender moves in?

Background

Convicted sex offenders are required to register in national and state registries under federal law (the Sex Offender Registration and Notification Act (SORNA), 18 U.S.C. §2250) and state law (in New York, the Sex Offender Registration Act (SORA), Correction Law Article 6, §168 enacted in 1996). Both SORNA—which sets the baseline that all states must follow—and SORA provide guidelines for how information provided by convicted sex offenders will be disseminated, if at all, to the public.

The goals of these registries are several: to deter offenders from committing future crimes, to provide law enforcement with an additional investigative tool, and to inform members of the community to, in theory, protect them. U.S. Department of Justice, Sex Offender Registration and Notification Act (March 6, 2018).

Under SORA, convicted sex offenders are classified in three separate “risk” levels by the sentencing court. Offenders in all three levels must register, and provide a multitude of information, including their name, aliases, date of birth, identifying physical features (e.g., scars, tattoos, etc.), home and employment addresses, Internet accounts, an up-to-date photograph, a description of their offense, and the sex of their victim. Correction Law Article 6, §168-f. Level 1 offenders (deemed to pose the lowest risk of a repeat offense) must only register for 20 years, while Level 2 and 3 offenders must register for life. Correction Law Article 6, §168-h. Information regarding Level 1 offenders is not provided online and is only available by telephone from the New York State Division of Criminal Justice Services, and then only if the person making the inquiry provides the offender's name and date of birth or address. Offenders in all three levels may file petitions to have their designation levels lowered—and if they are lowered to a Level 1, they will be removed from online registries. Correction Law Article 6, §168-o.

In New York state, sex offenders are not obligated to inform anyone of their past. Rather, the onus is on local law enforcement to release information, where necessary, to the community and/or particularly vulnerable populations, including schools, nursing homes, day care centers, etc. Correction Law Article 6, §168-l.

Unless a sex offender is on parole or probation, there are no restrictions in New York state as to where he or she can live. This rule was first adopted by the Court of Appeals in 2015, in People v. Diack, 24 N.Y.3d 674 (2015), where the court held that state law preempts local law on the issue of sex offender residency restrictions. The court invalidated one such municipal law in Nassau County that prohibited convicted sex offenders from residing within 1,000 feet of a school. Nassau County Administrative Code §8-130.6 (Local Law 4). This municipal law imposed residency restrictions stricter than state law, as the latter only prohibited convicted sex offenders who were on probation from residing within 1,000 feet of a school. The court ruled that the state's enactment of comprehensive legislation on the identification and monitoring of registered sex offenders was meant to “occupy the entire field … so as to prohibit local governments from doing so.” Id. at 680 (internal quotations omitted).

The ruling in People v. Diack led to the invalidation of over 100 other similar local and municipal laws across New York state. Jon Campbell, N.Y. Court Tosses Local Limits on Sex Offenders' Homes, USA Today (July 2015); Barbara Goldberg, Tide Turns Against US Residency Restrictions on Sex Offenders, Reuters (November 2015). This decision, like other similar ones across the country, is believed to have been fueled by mounting research, including a report issued by the U.S. Department of Justice in 2015, that such laws are not effective in reducing the rate of recidivism for sex offenders. C. Lobanoc-Rostovsky, Adult Sex Offender Management, SOMAPI Research Brief (July 2015)..

A Board's Obligations

The prevention of crime is generally a job for law enforcement and politicians, but that does not mean that boards of condominiums and cooperatives can or should sit idly by and relinquish any and all preventative action to the authorities. At the very least, boards must be aware of the sources of potential legal obligations to act.

A board's obligation in this regard starts right at the beginning—when a prospective purchaser comes knocking at a cooperative or condominium's door. In general, cooperative boards, like other landlords, have the benefit of screening and interviewing potential new shareholders and tenants (for some cooperative boards, such screening includes criminal background checks), while condominium boards typically only have a right of first refusal. Thus, cooperative boards may decide to reject a prospective purchaser or lessee who is a convicted sex offender (or an otherwise convicted criminal), and their decision to do so is generally unfettered and should be protected by the business judgment rule. See Levandusky v. One Fifth Ave. Apt., 75 N.Y.2d 530, 538 (1990) (“the business judgment rule prohibits judicial inquiry into actions of corporate directors 'taken in good faith and in the exercise of honest judgment in the lawful and legitimate furtherance of corporate purposes' … So long as the corporation's directors have not breached their fiduciary obligation to the corporation, 'the exercise of [their powers] for the common and general interests of the corporation may not be questioned …'” (internal citations omitted)).

Although the business judgment rule will not shield a cooperative or condominium board's decision if it is discriminatory (Jones v. Surrey Coop. Apts., 263 A.D.2d 33 (1st Dept. 1999)), under fair housing laws (42 U.S.C. §3604) individuals with criminal backgrounds are typically not considered protected classes. (Because minorities are protected classes and “criminal history-based restrictions on housing” statistically disproportionately impact minorities, the U.S. Department of Housing and Urban Development has cautioned against “blanket, arbitrary, or overbroad policies” which could be considered violations of the Fair Housing Act. See U.S. Department of Housing and Urban Development, Office of General Counsel Guidance on Application of Fair Housing Act Standards to the Use of Criminal Records By Providers of Housing and Real Estate-Related Transactions (April 4, 2016)).

A board may also have a legal obligation to prevent crime—or, more precisely, to take reasonable measures to prevent foreseeable criminal conduct. Indeed, New York courts have extended to condominiums and cooperatives the general rule that landlords, property owners, and possessors of real property have a duty to take reasonable measures to protect against foreseeable criminal conduct by third parties. See Mason v. U.E.S.S. Leasing, 96 N.Y.2d 875 (2002) (landlord has a duty to prevent foreseeable criminal conduct); Nallan v. Helmsley-Spear, 50 N.Y.S.2d 507 (1980) (business owner had obligation to take reasonable precautionary measures to minimize the risk of criminal acts and make premises safe for the visiting public); Miller v. State of New York, 62 N.Y.2d 506 (1984) (owner or possessor of land has a duty to maintain minimal security measures in the face of foreseeable criminal intrusion upon tenants); see also Chang v. Bd. of Mgrs. of 325 Fifth Ave. Condo., 2010 NY Misc. Lexis 2435, 2010 NY Slip Op 31345[U] (Sup. Ct. NY Co. 2010) (applying same rule of law to condominium board); Novikova v. Greenbrier Owners, 258 A.D.2d 149 (2d Dept. 1999) (applying same rule of law to cooperative board); Warfel v. Edgewater Park Owners, 13 Misc.3d 1219[A], 831 N.Y.S.2d 351, ****4 (Sup. Ct. Bronx Co 2006) (same).

In a cooperative and/or where there is otherwise a landlord/tenant relationship, the warranty of habitability may also obligate a board or landlord to take action to prevent crime. See Knudsen v. Lax, 17 Misc.3d 350, 842 N.Y.2d 341 (Co. Ct. Jefferson Co. 2007). In Knudsen, the court held that a landlord has obligation under the warranty of habitability to protect tenants from threats of foreseeable crimes posed by a Level 3 registered sex offender in the building. Id. at 345 (citing Park W. Mgt. v. Mitchell, 47 N.Y.2d 316, 328 (1979) (the “reach of the warranty of habitability” is determined by the “threats to the health and safety of the tenant”)); Raghu v. 24 Realty Co., 7 A.D.3d 455 (1st Dept. 2004) (“it is well established that a landlord has a common-law duty to take minimal precautions to protect tenants from foreseeable harm, which duty encompasses a third party's foreseeable criminal conduct” (internal citations omitted)).

In fact, the court held that but for the fact that Real Property Law §235-f bars a landlord from evicting a tenant solely for being a sex offender, the warranty of habitability would obligate a landlord to force a sex offender-tenant to move elsewhere. Id. at 345 (citing Cohen v. Werner, 82 Misc.2d 295 (Civ. Ct, Kings Co. 1975) (by not taking action where landlord “could have taken steps” to make the premises habitable, it violated the warranty of habitability)).

Recommendation 

Aside from preventing a sex offender from moving in to a building in the first place, there are a variety of factors a board should consider in deciding how to handle such a scenario.

Each and every situation is unique—all sex crimes are not the same, and neither are all buildings. Some residents may be more willing than others to welcome (or tolerate) convicted sex offenders in the building. It is always important that a board, like any other governing group, have its “finger on the pulse” of its constituents and their various points of view, to the extent possible.

Once a board learns that an applicant or resident is a sex offender, it should not immediately sound the alarms, but instead should determine if the person poses a “foreseeable” risk to others. If a board has a serial offender on its hands, for example, the action it chooses to take should be more aggressive than if it is dealing with a one-time, non-violent sex offender. Some situations may warrant the dissemination of a building-wide notice advising residents of the offender's presence (there are no laws prohibiting a board from informing its residents of public facts, so long as they are true); some may warrant only notifying residents with children that may be at risk; others may warrant enhancing the building's security; and still others may not warrant any action at all. If residents are particularly outraged, a board may consider obtaining the consent of shareholders or unit owners to attempt to purchase the offender's apartment (assuming the governing cooperative or condominium documents authorize such action) and get him or her out of the building. Notifying residents of a sex offender's presence could, by itself, compel the sex offender to leave, but it could also result in other residents needlessly harassing the sex offender. A board must be alert to the fact that any action it takes—or fails to take—could result in hysteria, which in turn could also negatively impact the value of units in the building. No board wants to allow its building to become a safe haven for sex offenders and criminals, but neither does any board want to hastily take action that will cause more harm than good in the building.

Finally, if a board decides to inform residents of the presence of a sex offender, it should make sure to strongly warn in advance against any harassment or objectionable behavior toward the offender—and, should any resident engage in such conduct, the board should not hesitate to denounce and take action against it to the fullest extent permitted under the building's governing documents.

In the end, while there is no simple answer to this issue, a board's obligation to act in any particular situation, should be guided by its fiduciary duty to all shareholders or unit owners.

Steven Sladkus is a partner and Milad Boddoohi is an associate at Schwartz Sladkus Reich Greenberg Atlas.