Management companies are reluctant to sue their clients, and for understandable reasons — the industry is small, boards talk to each other, and nobody wants a reputation for litigating. So invoices go unpaid for months, the relationship ends, and the agent writes off money it plainly earned.
That reluctance is worth reconsidering when a board has simply stopped paying. Fee claims under a written management agreement, supported by invoices the building accepted without objection, are among the more straightforward commercial claims there are. The difficulty is almost never proving the debt — it is that the agent waited two years and by then the board had constructed a narrative about why it did not pay.
We represent management companies in claims against the boards they served. Call 212-233-1233 or email [email protected].
What You Can Recover
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Unpaid management fees
Fees earned and invoiced under the agreement. Where invoices were sent regularly and the building never objected to them, the claim can often be framed as an account stated, which shifts the practical burden onto the board to explain why it sat on invoices it now says were wrong.
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Fees for the notice period
If the agreement required sixty or ninety days' notice and the board terminated immediately, the fees for that period are generally still owed. Boards often treat a termination as ending the fee obligation the same day, which the agreement usually does not support.
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Expenses advanced
Costs you paid on the building's behalf and were never reimbursed — vendor payments, filing fees, supplies, payroll funded out of your own accounts. These are usually recoverable and usually under-claimed, because nobody compiles them.
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Damages for early termination
Where a fixed-term agreement was ended early without cause, the remaining fees may be recoverable as contract damages, subject to your obligation to mitigate.
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Enforcement of the indemnity
If a resident or vendor sued you over something arising from your management of the building, and the agreement obligated the building to defend and indemnify you, your defense costs are a claim against the building.
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Interest, late charges and legal fees
If the agreement provides for them. A fee-shifting clause changes the economics entirely and is worth locating before deciding how to proceed.
Who You Are Actually Suing
The defendant is the cooperative corporation or the condominium's board of managers as an entity, not the individuals on the board. Directors acting within their role are generally protected, and naming them personally without a proper basis makes a clean fee claim look like a grievance.
This matters practically as well as legally. Buildings are collectible defendants — they have reserves, they collect maintenance and common charges every month, and they cannot easily become judgment-proof. A judgment against a building is worth considerably more than most commercial judgments.
What the Board Will Say
Expect the fee claim to be met with a counterclaim about your performance. This is standard, and it is usually why the fees went unpaid in the first place.
- That the services were deficient, so the fees were not earned
- That the termination was for cause, excusing the notice period
- That you exceeded your authority on specific expenditures
- That the books and records were never properly turned over
- That there are accounting discrepancies requiring explanation
Anticipating this changes how the claim should be prepared. The file you assemble before filing should cover not only what you are owed but what you did: the recommendations you made, the board's decisions, the reports you delivered, the turnover you completed. See defending claims brought by the board.
Before You File
- Check the management agreement for an arbitration clause or a required notice-and-cure step — filing in the wrong forum wastes months
- Compile the invoices, the payment history, and proof that invoices were delivered and not objected to
- Compile every advanced expense with backup
- Assemble the turnover record, including the signed receipt if you obtained one
- Pull the board minutes and your written recommendations from the period in dispute
- Confirm the applicable limitations period — older invoices can fall out of reach
- Send a demand that is specific, documented and short on adjectives; a surprising number of these resolve at that stage
Speak With Our Firm
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Collect what you earned
We pursue fee and expense claims for management companies, and we handle them with an eye to the counterclaim that is usually coming. In many cases a properly documented demand from counsel resolves the matter without a filing, because the board's position depends on the agent not taking it seriously.
Call 212-233-1233 or email [email protected]. See also leaving a building.
