Op filed for Chapter 11 bankruptcy reorganization in May 1992.
Worst-Case Scenario: Foreclosure Foreclosure is the worst thing that can happen when a co-op files for bankruptcy.
In the event that a co-op files for bankruptcy as a result of defaulting on its mortgage, the lender has the power to foreclose on the building and evict the shareholders.
Unable to pay the $435,000 in damages and legal fees or to refinance its existing loan, the co-op filed for bankruptcy protection.
The city eventually moved to retake control of the space; in 2007, the co-op filed a lawsuit disputing the boundaries of the area to which the city was entitled.
A coalition of neighbors, both individuals and boards of co-ops, filed suit against the developer, which had bought air rights -- permission to transfer authorized but unused floor space -- from the owner of the house, and against the Landmarks Preservation Commission.
He is not involved in a lawsuit the co-op filed against the Federal Transit Administration and the M.T.A. On each of the corners cited by Mr. Bass, the developers could have sought development rights, known as air rights, from smaller adjacent residential buildings, Mr. Bass said.
Finally, Mr. Zuckerman said, while it is possible for the letter writer to withhold maintenance payments until the noise problem is abated, that strategy is usually risky since it could lead to the co-op filing an action to terminate the letter writer's proprietary lease.
That can sometimes be accomplished, Ms. Donoghue said, by purchasers or their lawyers reviewing the minutes of board meetings and checking the co-op's files for letters of complaint.
The loss of the legal challenge in 2000 pushed the co-op to file for bankruptcy protection that year.
In November, the co-op board filed to evict her, saying that by appearing "disoriented and confused" on several occasions, she had violated her co-op agreement.
