Section 32. Supervision and regulation

The commissioner or the supervising
  agency as the case may be, may:
    1. Examine a company and keep informed as to  its  general  condition,
  its  capitalization and the manner in which its property is constructed,
  acquired,  rehabilitated,  leased,  operated  or  managed,  and  to  its
  compliance  with all provisions of law and orders of the commissioner or
  the supervising agency.
    2. Require every company to file with  him  or  it  an  annual  report
  setting  forth  such  information as the commissioner or the supervising
  agency may require, verified by the oath of any officer, general manager
  or other person in control of the company. Such report  shall  be  in  a
  form,  cover  a  period,  and  be  filed  at a time as prescribed by the
  commissioner or the supervising agency.
    3. From time to time make, amend and repeal  supplementary  rules  and
  regulations  for  carrying  into  effect  the provisions of this article
  provided, however, that such supplementary rules and  regulations  shall
  be  strictly  limited  in  their application to the means and methods of
  compliance with the provisions of  this  article  to  which  such  power
  relates.
    4. Make such agreements with bondholders, mortgagees or creditors of a
  company  to do or refrain from doing any act, not inconsistent with law,
  to protect the investment rights of the state of New York, the New  York
  state  housing  finance  agency,  the  New York city housing development
  corporation or of the municipality.
    5 (a) Administer oaths, take affidavits, hear testimony and take proof
  under oath at public or private hearings; (b) subpoena and  require  the
  attendance   of  witnesses  and  the  production  of  books  and  papers
  pertaining to  any  investigations  and  inquiries  authorized  by  this
  article  and examine them in relation to any matter concerning which the
  power  to  investigate  is  granted;  (c)  issue  commissions  for   the
  examination of witnesses who are out of the state or unable to attend or
  are  excused  from  attendance;  (d)  investigate  into the affairs of a
  company and into the dealings, transactions  or  relationships  of  such
  company  with  third  persons  and into the affairs of any person, firm,
  corporation or other entity having a financial interest, whether  direct
  or  indirect,  in the design, construction, acquisition, reconstruction,
  rehabilitation, improvement,  financing  or  operation  of  any  project
  undertaken  by  a  company;  (e) intervene, as a matter of right, in any
  action or proceeding of  which  notice  shall  be  given  affecting  the
  project  of  a company; (f) take such steps in such action or proceeding
  as may be necessary to protect the public interest.
    With regard to duties and liabilities arising out of this article  the
  state,  the  commissioner  or  the supervising agency may be sued in the
  same manner as a private person. No costs shall be awarded  against  the
  commissioner,  the state, or the supervising agency, as the case may be,
  in any such litigation.
    6. In the event of a violation by a company  of  a  provision  of  the
  certificate  of  incorporation  or  of  law  or  of the loan or mortgage
  contract or of any rules and regulations duly  promulgated  pursuant  to
  the  provisions  of  this  article,  the commissioner or the supervising
  agency, as the case may be, may  remove  any  or  all  of  the  existing
  directors  of  the  company  and  appoint such person or persons who the
  commissioner or the supervising agency, as the case may be,  in  his  or
  its  sole discretion deems advisable, including officers or employees of
  the division of housing and community renewal or the supervising agency,
  as new directors to serve in the places of those removed.  Directors  so
  appointed  need  not  be shareholders or meet other qualifications which
  may be prescribed by the certificate of incorporation or by-laws. In the

  absence of fraud or bad faith,  directors  so  appointed  shall  not  be
  personally   liable   for  debts,  obligations  or  liabilities  of  the
  corporation. Directors so  appointed  shall  serve  only  for  a  period
  coexistent with the duration of such violation or until the commissioner
  or  the  supervising  agency, as the case may be, is assured in a manner
  satisfactory to him or  it  against  violations  of  a  similar  nature.
  Officers  or  employees of the division of housing and community renewal
  or of the supervising agency who are so  appointed  as  directors  shall
  serve  in  such  capacity without compensation. No such removal may take
  place without  written  notice  and  an  opportunity  for  the  affected
  directors  to appear and be heard before the agency or commissioner with
  respect to any alleged violation  and  the  respective  parties  may  be
  represented  by  counsel.  Notwithstanding any inconsistent provision of
  any general, special or local law or any  limitation  contained  in  the
  provisions  of  any  city charter, the state or a municipality acting by
  and through the commissioner or the supervising agency, as the case  may
  be,  shall  save  harmless  and indemnify any officer or employee of the
  division of housing and community renewal or the supervising  agency  so
  appointed  as  a director, from financial loss arising out of any claim,
  demand, suit or judgment by reason of alleged negligence or other act by
  such director, provided that such director was acting in  the  discharge
  of  his duties and within the scope of his employment and that such loss
  did not result from the willful and wrongful act or gross negligence  of
  such   director  and  provided  further  that  this  save  harmless  and
  indemnification provision shall not in any way impair, limit  or  modify
  the  rights and obligations of any insurer under any policy of insurance
  and shall inure only to directors so appointed and shall not enlarge  or
  diminish  the rights of any other party. No action or special proceeding
  based on or arising out of alleged  negligence  or  other  act  by  such
  director  may  be  commenced  against such director, municipality or the
  state unless a notice of claim shall have first been served in a  manner
  consistent  with  service  upon a municipality or the state, as the case
  may be.
    7. Whenever the commissioner, in the case of a company undertaking  or
  otherwise operating a state-aided project, or the supervising agency, in
  the   case   of   a   company   undertaking  or  otherwise  operating  a
  municipally-aided project, shall be of the opinion that such company  is
  failing or omitting, or is about to fail or omit to do anything required
  of  it by law or by order of the commissioner or is doing or is about to
  do anything, or permitting anything, or is about to permit  anything  to
  be done, contrary to and in violation of law or of any order, regulation
  or  directive of the commissioner or the supervising agency, as the case
  may be, or which is improvident or prejudicial to the  interest  of  the
  public,   the   lienholders,  the  stockholders,  or  the  tenants,  the
  commissioner or the supervising agency, as the  case  may  be,  may,  in
  addition  to such other remedies as may be available, commence an action
  or proceeding in the supreme court of the state of New York in the  name
  of  the  commissioner or the supervising agency, as the case may be, for
  the purpose of having such violations or threatened  violations  stopped
  and  prevented, and in such action or proceeding the court may appoint a
  temporary or permanent receiver or both. Such action or proceeding shall
  be commenced by a petition to the supreme court, alleging the  violation
  complained  of and praying for appropriate relief. It shall thereupon be
  the duty of the court to specify the time,  not  exceeding  twenty  days
  after  service  of  a  copy  of  the  petition, within which the company
  complained of must answer the petition. In case of any default or  after
  answer   the   court  shall  immediately  inquire  into  the  facts  and
  circumstances in such manner as the court shall direct without other  or

  formal  pleadings,  and  without  respect to any technical requirements.
  Such other persons or  corporations  as  it  shall  seem  to  the  court
  necessary  or  proper  to  join as parties in order to make its order or
  judgment  effective, may be joined as parties. The final judgment in any
  such action or proceeding shall either dismiss the action or  proceeding
  or direct that an order or an injunction, or both, issue, or provide for
  the  appointment  of a receiver as prayed for in the petition, and grant
  such other relief as the court may deem appropriate.
    8. The commissioner or supervising agency may modify supervision of  a
  company  upon  finding that duplicative supervisory functions may impose
  an  undue  regulatory  burden  or  unnecessary  expenditure  of   agency
  resources,  by  taking such actions as are deemed appropriate, including
  consolidating supervisory functions associated with different  programs,
  and entering into memoranda of understanding with other agencies for the
  allocation of supervisory functions.