Members' derivative action
- Statute:
- New York §623 · Law NPC (Not-for-Profit Corporation Law)
- Topic:
- Dispute Resolution · Derivative suits
- Applies to:
- Nonprofit associations
A member may bring a derivative action on behalf of the corporation after written demand on the board. Court may require security for expenses if certain conditions exist.
📄 Read the official text at nysenate.gov →
How SoShiny helps with Members' derivative action
SoShiny logs every member complaint, compliment, or formal grievance with an audit trail — submitter, date, response, resolution. Anonymous filing optional. The documentation that pre-suit mediation and arbitration require is captured by default.
See the feature → Start freeFrequently asked
- What does New York §623 require?
- A member may bring a derivative action on behalf of the corporation after written demand on the board. Court may require security for expenses if certain conditions exist.
- Who does New York §623 apply to?
- New York §623 applies to Nonprofit associations in New York.
- What happens if our co-op or condo doesn't comply with §623?
- Non-compliance with this New York statute can expose the association and its officers to private civil suit, and (for offering-plan / sponsor matters under GBS) to enforcement action by the New York Attorney General's Real Estate Finance Bureau. SoShiny's audit trail and documented workflows are designed to demonstrate good-faith compliance.
- Where can I read the official text of New York §623?
- The official text is published by the New York State Legislature at nysenate.gov. The summary on this page is for plain-English reference only and is not legal advice.
- How does SoShiny help with Members' derivative action?
- SoShiny logs every member complaint, compliment, or formal grievance with an audit trail — submitter, date, response, resolution. Anonymous filing optional. The documentation that pre-suit mediation and arbitration require is captured by default. Learn more →
Not legal advice. This page is a plain-English summary of New York §623 prepared by SoShiny for board members and managers. For binding legal advice or interpretation, consult a New York-licensed attorney. For the official statutory text, see the link above.
Stay current on New York association law.
Get the free quick-reference guide plus a heads-up when the statutes that govern your community change.
Don’t run your co-op or condo on spreadsheets.
Start your community free →