Case Notes

Case Notes provides insight on one particularly relevant co-op or condo case—clearly explaining what happened, why it’s important, and what lessons can be learned within.

289 results
First published: Jul 2007
Sassi-Lehner vs. Chariton Tenants Corp.

This decision undercuts the ruling of New York’s highest court in the recent Kralik case, which recognized the broad contractual rights of holders of unsold shares in the face of regulations of the attorney general that sought to limit them. Here, the co-op’s offering plan had been amended in 1990 to require a holder of unsold shares to be designated by the sponsor – a requirement derived solely from the attorney general’s regulations – and this expanded definition in that plan was seized upon by the court to invalidate the claim of holders of unsold shares.

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First published: Jun 2007
1050 Tenants Corp. vs. Lapidus

This appears to be the last in a long series of decisions involving the co-op at 1050 Fifth and the Lapiduses over a variety of issues related to the defendants’ occupancy and conduct in the co-op. Prior decisions have been the subject of earlier “Case Notes.” Here, the co-op’s patience with the Lapiduses’ repeated objectionable conduct was at an end, and it invoked the Pullman decision to validate its lease termination. This case is the latest progeny of Pullman and is further evidence of what a potent weapon this decision has become for co-op boards when faced with seriously objectionable conduct.

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First published: Jun 2007
Estate of Angela Schiller

If the amounts sought in this case were not disputed, or at the least easily calculable under some specific provision of the co-op’s bylaws or proprietary lease which give the co-op the right to impose a specific item, for example, a late fee, a sublet fee, or a transfer fee, the court would have upheld such payment as a precondition to the transfer. However, in this case, where the amounts were unliquidated, speculative, and disputed, the court refused to give the co-op an advantage by requiring the requested payment. This will require further legal action. The issue might be changed in the future by a proprietary lease amendment giving the board specific authority to charge amounts in certain disputes with shareholders.

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First published: Apr 2007
Lisenenkov v. Kaszirer

This is another example of a board seeking to exceed its authority. Here, a condominium board was trying to impose requirements on a prospective apartment purchaser because it was uncertain about the ability of such purchaser to pay his shares of the common charges for the building. The only problem was that the board’s solution – an advance payout of two years of common charges – was beyond the board’s powers. So, when challenged, the court determined that the requirement was invalid and this condo board was forced to realize that it was not a co-op board, which usually has the power to require a purchaser to provide a security deposit.

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First published: Mar 2007
Poyck v. Bryant

This is a case of first impression and may signal the first of many cases that could lead to severe restraints on the ability of co-op owners to smoke in their apartments, especially when neighbors complain of tobacco odors. While secondhand tobacco odors have long been viewed as a nuisance, they are now being treated as a health hazard that may be regulated. Boards must be vigilant to this hazard and act to remedy what may now be viewed as a breach of the warranty of habitability. That switch carries real consequences for a board.

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First published: Jan 2007
Colin Fraser v. 301-52 Township Corp.

This decision is helpful for owners of residential property in New York, including cooperative and condominium boards. It firmly establishes the view that mold concerns in apartment buildings – the latest environmental issue of the past 30 years – are unlikely to have the same impact as have such prior environmental issues as asbestos and lead-based paint. Mold is not as serious a health hazard as has been suggested elsewhere. Of course, the presence of mold in water-damaged environments still must be remediated expeditiously to mitigate property-damage claims. Nonetheless, until there is an appellate decision on personal injury from mold, it would be wise to view this decision cautiously. It is not the last word.

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First published: Dec 2006
Blumberg vs. Albicocco

This case is consistent with a number of prior co-op and condo decisions holding that a board’s power to fine a cooperative or condominium unit-owner for not paying or other objectionable conduct must be expressed in the governing documents of the entity – usually the proprietary lease or bylaws –- and will not be implied by the court. The solution is to amend the governing documents by the requisite vote of unit-owners to give a board the power to fine in specific instances.

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First published: Nov 2006
Forest Hills Realty Inc. v. Austin Sheppard Realty Inc.

Despite the number of prior cases cited by the court, this case appears to be one of first impression involving the brokerage of co-op apartments. The decision is surprising because it is clearly anti-competitive and at variance with current practice in New York to encourage competition among real estate brokers to secure the best prices. Perhaps the broker sought relief on the wrong theory. Would the result be the same if a co-op shareholder brought an action against the board for restraining trade by allowing only one broker for the building? Doubtful.

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First published: Nov 2006
Silverman v. 875 Tenant Corp.

This was initially an action brought by a shareholder against the co-op that was unsuccessful. As a result of the shareholder’s failure, the co-op sought to have the shareholder reimburse the co-op for its legal expenses as provided in the proprietary lease. The co-op succeeded and the case should be a warning to a shareholder who sues his or her co-op that, if the shareholder does not prevail, there is a good chance that he or she may end up paying the legal fees both for the shareholder and the co-op. Such fees may be quite substantial.

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First published: Jul 2006
1050 Tenants Corp. v. Lapidus

The objectionable and undesirable characteristics of Lapidus appear self-evident. His dispute with the co-op has become a cause celebre in the co-op legal community. Here, the co-op properly followed the Court of Appeals-mandated requirements under both the seminal Levandusky case and its Pullman progeny, leaving the court little choice but to approve the co-op’s termination of the Lapidus tenancy for objectionable conduct. Increasingly, Pullman should be seen as a real wake-up call for any co-op shareholder who acts in an outrageous anti-social manner.

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