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
- Appeals
- Arbitration
- Assessment
- Attorney Fees
- Attorney-Client
- Authority to Sue
- Balcony/Terrace Rights
- Bike Lane
- Board of Directors
- 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
- Negligence
- 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: Nov 2004
Northeast Restoration Corp. v. K&J Construction Co. L.P.In this case, the contractor was engaged by a developer for roofing work in the construction of a condominium development. Because of a dispute with the developer, the contractor was not paid. It failed to file a mechanics lien before the property was converted to condominium ownership. When the contractor filed under the Condominium Act to recover from the common charges paid to the association by unit-owners, the court disallowed the lien on the ground that the unit-owners bought their units expecting that the developer had already paid for the improvements. The contractor was stuck.
Read full articleFirst published: Nov 2004
Board of Managers of Lido Beach Towers Condominium v. GamielThe motion court failed to actually decide both the immunity of the board and whether the “pet carry” rule discriminated against a unit-owner with a medical necessity. It required a trial to ascertain the facts giving rise to each issue. However, from the views expressed by the court, it seems likely that the board’s immunity will be upheld and that an exception to the rule will be granted if a discriminatory motive on the board’s part can be shown.
Read full articleFirst published: Oct 2004
13315 Owners Corp. v. KennedyThe court’s great caution in adhering to the Pullman doctrine is apparent throughout this carefully decided case. Here, the lease termination was the result of board action without a shareholder vote unlike the case in Pullman, which involved shareholder action. Since the court expresses concern about arbitrary action by a few shareholders who also happen to be board members, when there is evidence of some irregularity in the actions taken by the board to evict Kennedy, the court concludes that it, not the board, must determine if the actions complained of by the board constituted objectionable conduct. This result is presumably the way a court would have acted before Pullman. Several further decisions can be anticipated as New York courts try to flesh out the parameters of the Pullman decision.
Read full articleFirst published: Sep 2004
Rouette v. One West 126th Street Housing Development Fund Corp.This case illustrates a co-op board’s misuse of the business judgment rule standard of review from the Levandusky case to justify its action. The rule only protects board decisions within the scope of the board’s authority taken in good faith for legitimate business purposes of the co-op. It does not permit the co-op to breach its contractual obligations to buy and sell a co-op apartment with one of its shareholders.
Read full articleFirst published: Sep 2004
360 East 72nd Street Owners Incorporated v. RutterAlthough this case was decided in favor of the co-op, the board may have merely won the first battle in a protracted war over the use of the terrace. From the list of counterclaims asserted by the shareholders, there are other issues to be resolved by the courts. While the court stopped the ball-playing for the moment, it is likely that this decision will be challenged in the future.
Read full articleFirst published: Jul 2004
129 East 69th Street Corp. v. Estate of Louise M. AndersonBecause the defendant here was not properly identified, the co-op's action to recover possession was dismissed. Service on the executor of the estate of a deceased shareholder was not only ambiguous, but also defective under state law. As a result, the action was delayed and additional legal effort was required.
Read full articleFirst 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 article