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.
Category
- Access
- Alterations
- Arbitration
- Assessment
- Attorney Fees
- Attorney-Client
- Authority to Sue
- Balcony/Terrace Rights
- Bike Lane
- Books and Records
- Breach of Lease
- Business Judgment Rule
- Bylaws
- Bylaws/House Rules
- Certificate of Occupancy
- Charges/Fees
- Commercial Unit
- Common Element
- Common Elements
- Companion Animal
- Constitutionality
- Construction Defects
- Contracts
- Conversion
- Defamation
- Discovery
- Discrimination
- Due Diligence
- Easement
- Elections
- Estate
- Eviction
- Eviction/Termination
- Fiduciary Duty
- Fines
- Foreclosure
- Fraud
- Governance
- Gym
- House Rules
- Indemnification
- Indemnification/Subrogation
- Injunction
- Insurance
- Labor Law
- Liability of Directors
- Licenses
- Liens
- Maintenance
- Malpractice
- Management
- Mechanic's Lien
- Misrepresentations
- Motion Practice
- Motion Practive
- Notice of Pendency
- Nuisance
- Occupancy Agreement
- Ownership
- Parking
- Partnership
- Personal Injury
- Pets
- Property Damage
- Proprietary Lease
- Reasonableness
- Receivership
- Release
- Repairs
- Representations
- Sales
- Sponsor
- Statute of Limitations
- Stock/Shares
- Stocks/Shares
- Sublets
- Succession Rights
- Tax
- Third-Party Liability
- Transfers
- Trespassing
- Trial Practice
- Violations
- Warranty of Habitability
- Yellowstone Injunction
- Zoning
First published: Jul 2004
Ruth Mishkin v. The 155 CondominiumThe decision in this case is being appealed and caution is advisable in relying on its holding because there is recent appellate authority which holds to the contrary and would limit the sponsor's right to use its votes to elect a majority of the board after conversion. These appellate cases hold that where a sponsor has restricted its right to the deciding vote in the election of more than a minority of the board, that restriction will be enforced by the courts.
Read full articleFirst published: Jun 2004
Citipark II Associates, Ltd. and 44 West 62nd Garage LLC., v. Lincoln Plaza Tenants Corp.The case resulted from the requirements of Section 216 of the Internal Revenue Code, which provides substantial tax benefits for co-op shareholders. In order to get these benefits, in each year the co-op must derive more than 80 percent of its gross income from shareholders, the so called 80/20 test. Here, the co-op assessed its shareholders in order to collect more rent from the garage tenant without jeopardizing its tax benefits. The garage tenant objected, arguing that the assessment was improper. The court disagreed and said that the co-op was not restricted from doing so, since the garage lease did not preclude this action.
Read full articleFirst published: May 2004
Edith K. Spiegel v. 1065 Park Avenue CorporationThis case reinforces established law about treating some shareholders differently from others. Because of the Business Corporation Law dictates, this is not permissible. Special privileges, even if provided for in the proprietary lease, are unenforceable. However, rights of holders of unsold shares may still be protected.
Read full articleFirst published: May 2004
Fraken Builders Inc. v. Joanne M. CicconeThis case involved a sublease in a co-op apartment building. The co-op here was a proprietary lessee seeking to enforce its house rule about required floor coverings against a shareholder occupant of the apartment who was obviously the subject of complaints from adjacent occupants. Undoubtedly, the co-op encouraged this action by its shareholder. Because the sublease incorporated by reference the house rules from the proprietary lease, the shareholder was bound to observe those rules. The significance of this case is that the court sanctioned enforcement of required floor coverings and thus validated this common and widely used co-op house rule.
Read full articleFirst published: Apr 2004
Babeli v. East 13th Street Tenant Corp.Once a shareholder in a co-op embarks upon an apartment alteration with co-op approval, it is very difficult to stop such alteration without a clear and compelling reason as long as the work is proceeding as authorized. In other words, once an apartment alteration is approved, a co-op does not have the option of changing its mind and stopping the work.
Read full articleFirst published: Apr 2004
Robert Fleisig v. 75 East End Owners Inc.This is one of a long line of co-op cases establishing the principle that where there are building repairs to be done by the co-op, the co-op determines the scope of such repairs, including the nature and extent, even if an affected shareholder prefers a different methodology or aesthetic.
Read full articleFirst published: Mar 2004
178 E. 80th St. Owners, Inc. v. JenkinsThe result here was most unusual. In American jurisprudence, each party normally bears its own legal expenses. Occasionally, by contract, this rule can be varied so that either one party or another bears the expenses of both parties. Often, the proprietary lease so provides. In this case, the lease was not the basis. Rather, it was the combination of the federal court venue and the shareholder's contempt of court, a unique situation.
Read full articleFirst published: Mar 2004
Peck v. Lily LodgeThe facts of this case led the court to conclude that the defendant was operating a bed-and-breakfast establishment in a co-op, which is inimical to the underlying purpose of a co-op enterprise. Transient occupancy involves a commercial enterprise, which has no place in a building designed to provide housing for its shareholders. The courts invariably frown upon such operations and not even the so-called roommate law could be invoked to help the tenant's position.
Read full articleFirst published: Jan 2004
Trepel v. DiopBy Richard Siegler, Stroock & Stroock & Lavan This case reveals that a court will enforce a shareholder’s agreement given to induce a co-op to permit the transfer of shares and a proprietary lease to that person which in some manner restricts the use or occupancy of the apartment. Here, the court permitted only such access as was needed to sell the apartment, but without providing a key that would have afforded unlimited access to the apartment by the shareholder.
Read full articleFirst published: Dec 2003
Brodsky v. Board of Managers of Dag Hammarskjold Tower CondominiumWhile notarized proxies may be required in some instances, this is rarely done. This case makes clear that if it is to be done it should be done by amendment of the governing documents – usually the bylaws, which in the case of many co-ops and most condominiums requires a vote of the owners. What is less certain is the court’s decision to require a new election for the six incumbent board of managers. The court did not have to decide this issue, but was obviously troubled by the failure to elect any of these managers at meetings because there was never a quorum of unit-owners present.
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