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.

296 results
First published: Sep 2003
Amalgamated Dwellings Inc. v. Szold & Brandwen, P.C.

The message here is to review invoices for legal services promptly when submitted after the services are rendered or disbursements incurred. The court was not sympathetic to the co-op's efforts to question the appropriateness of legal fees paid many years ago before there was some estrangement in the attorney-client relationship.

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First published: Sep 2003
445/86 Owners Corp. v. Charles Haydon

It appears that the co-op pursued the wrong remedy. Instead of seeking to collect a sublet fee for the sole occupancy of an apartment by the shareholder's mother-in-law, it should have brought an action to end the unauthorized use of an apartment by a family member where the shareholder of record was absent, a violation of most proprietary leases.

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First published: Aug 2003
Saxon Garage Corp. v. Regency East Apartment Corp.

What triggered this action for trespass after a long established practice is uncertain. It may have been that the garage was seeking to exact money from its co-op landlord. Perhaps business was in the doldrums and the garage was trying to persuade its landlord to reduce the rent. Certainly, the effort was unsuccessful.

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First published: Jul 2003
Lesal Associates v. Board of Managers, Downing Court Condominium

This is not an unusual case where a board of managers, dominated by the interests of residential unit-owners and controlling a substantial majority on the board, seeks to reallocate common charges to lessen the burden on the residential unit-owners. Here, the effort failed and the court refused to sanction the reallocation. The question is can efforts to achieve this goal elsewhere succeed because the non-residential unit-owners are loathe to challenge the board?

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First published: Jun 2003
Rahman v. Board of Managers of Yardarm Condominium

This case is somewhat surprising because the insurance was inadequate. It seems that the board got poor advice about the appropriate amount of coverage that was available even if it required payment of an additional premium. It is a good lesson about the need for a co-op or condo board to obtain and follow first-rate advice from competent professional advisers when obtaining property and liability insurance coverage, even in this time of significant increases in insurance premiums.

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First published: May 2003
Feld v. 710 Park Avenue Corp.

This foiled attempt to bar Feld from board service for being at odds with the current board must be viewed as outrageous. The case illustrates the difficulties a co-op or condo board faces when it seeks to bar a dissident from service, especially where cumulative voting is provided in the entity's bylaws.

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First published: Apr 2003
Gramercy Park Residence Corp. v. Ellman

This was a victory for the co-op, which obtained all the relief it sought in light of the shareholder's intransigence to allow needed repairs. One must wonder what impelled this shareholder to resist legitimate board action. Perhaps poor legal advice?

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First published: Mar 2003
Barbour v. Knecht

A lower court decision that board consent was not required for this transfer was reversed. The co-op documents and the history of prior transfers, all of which mandated board approval, were the controlling factors, despite a shareholders' agreement and the fact that the purchaser was already a shareholder. This decision reinforces the standard co-op requirement of the need for board approval of apartment transfers.

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First published: Jan 2003
Amato v. Hird

Real estate contracts in the New York metropolitan area including co-op purchase and sale agreements normally provide for a 10 percent deposit on account of the purchase price. Invariably, this deposit is held in escrow until the closing when it is paid to the seller. If the sale fails to take place because some contingency in the contract does not occur, the purchaser would normally have his deposit returned. If the sale fails to occur because of the seller's breach, the normal remedy is an action for specific performance to compel the conveyance of a unique piece of real estate. If the sale fails to occur because of the purchaser's breach, the deposit is virtually always retained by the seller as liquidated damages. This case holds that a 10 percent deposit qualified as liquidated damages and not a penalty. If, in another contract for the purchase and sale of a co-op, there was a provision for a 20 percent deposit, could this also serve as liquidated damages and not a penalty if so specified in the contract? The answer is maybe, as the decision would depend on all of the facts and circumstances that justified an increase in the standard deposit from 10 to 20 percent.

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First published: Dec 2002
Teitelbaum v. Woodbury Village Condo-minium II

The result in this case is somewhat surprising. The "irrevocably restricted" common element is normally called a "limited" common element meaning that its use is restricted to a single unit, although traditionally the cost of maintenance of the space is a common expense. Here, the cost of maintenance was held to be the responsibility of the unit owner. The result suggests the importance of reading the condominium documents carefully and realizing that specific provisions govern which may produce a result at odds with expectations.

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