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: Jun 2023
Much Ado About A LeakWhile it was probably worth the shot at moving to dismiss based on what seem to be fairly damning emails that there is no leak damage in Apt. 4E coming from 5E’s bathroom, ultimately courts are often hesitant to rely on emails in a motion to dismiss as documentary evidence. Here, maybe if a moisture expert, or even a plumber, had undertaken the same testing as the super and issued a report, it is possible such would have been more appropriately relied upon as documentary evidence on a motion to dismiss. Still, the shareholders of Apt. 5E face an uphill battle, as the proprietary lease plainly provides the co-op access to examine the pipes in apartments in order to find and fix leaks.
Read full articleFirst published: Jun 2023
Good FaithSo long as the Board of Managers acts in good faith and within its authority under the by-laws, the court will not second-guess the decisions of the board and its decisions are protected by the Business Judgment Rule. Unpopular decisions can be challenged in the courts, and every decision can be appealed (which is the case here). However, if residents of a condominium or co-op are that unhappy with the current board’s governance, they should seriously consider campaigning to elect a board that shares the same values as they do.
Read full articleFirst published: Jun 2023
Board of Managers of the Broad Exchange Building Condominium v. Nicole LambertIt is important that boards respond promptly to complaints from unit-owners to prevent nuisance situations from spiraling out of control and to avoid being sued by unit-owners for failure to enforce the rules. In this case, the board quickly mustered a barrage of complaints from unit-owners and neighbors from the adjacent building, including photos and videos documenting the offending conduct. But without seeking a temporary restraining order at the outset, the offending conduct was allowed to carry on from June 2022 until the issuance of the preliminary injunction in March 2023. Moreover, the court did not order that Ms. Lambert remove any dogs from her unit. Because the parties will now proceed to litigate the validity of Ms. Lambert’s discrimination claims, the dogs may remain in place for a long time before their final status is resolved. But if the board ultimately prevails on its claims that Ms. Lambert has violated the bylaws and house rules, it may be entitled to recover its reasonable attorneys’ fees from Ms. Lambert. Unit-owners who own noisy or vicious pets often argue that they are service animals or emotional support animals, and boards will typically need to consult with counsel to ascertain whether the applicable requirements have been met to avoid running afoul of anti-discrimination law.
Read full articleFirst published: May 2023
Ground Lease TsurisThis litigation dramatically illustrates some of the difficulties faced by ground lease co-ops and their shareholders. Most co-ops in New York City own the land on which their buildings are built, and most of those co-ops took title to the land at a time when property values were much lower than they are today. As a result, the equity in most co-ops resides in the individual apartments and are bought and sold among shareholders who can afford to pay premium prices for apartments. Ground lease co-ops, meanwhile, may include many shareholders who may not be able to pay the prices needed to acquire the land. It is no wonder that shareholders like the plaintiff are willing to go to court in hopes that a judge might relieve them of these difficult choices.
Read full articleFirst published: May 2023
Four-legged Identity CrisisIt is important that boards respond promptly to complaints from unit owners to prevent nuisance situations from spiraling out of control and to avoid being sued by unit owners for failure to enforce the rules. In this case, the board quickly mustered a barrage of complaints from unit owners and neighbors from the adjacent building, including photos and videos documenting the offending conduct. But without seeking a temporary restraining order at the outset, the offending conduct was allowed to carry on from June 2022 until the issuance of the preliminary injunction in March 2023. Moreover, the court did not order that Ms. Lambert remove any dogs from her unit. Because the parties will now proceed to litigate the validity of Ms. Lambert’s discrimination claims, the dogs may remain in place for a long time before their final status is resolved. But if the board ultimately prevails on its claims that Ms. Lambert has violated the by-laws and house rules, it may be entitled to recover its reasonable attorneys’ fees from Ms. Lambert. Unit owners who own noisy or vicious pets often argue that they are service animals or emotional support animals, and boards will typically need to consult with counsel to ascertain whether the applicable requirements have been met to avoid running afoul of anti-discrimination law.
Read full articleFirst published: May 2023
Spirollari v. Breukelen Owners Corp. and SMRC Mgmt LLCAn issue that is very common in co-ops and condos is the use of the handymen and other staff after hours by the shareholders and unit-owners. This litigation illustrates the danger when boards allow that. If there is an injury, might the board be held responsible? If there is damage caused during the job, who might be responsible? Is the super or the board still somehow supervising the work, even though they are not in the room? These are questions that one does not want to have to answer when disaster strikes. If a board allows its employees to work for residents after hours, a policy should be put in place and a waiver of liability signed by the shareholder or unit-owner, freeing the board from any responsibility. The resident should be made aware that the co-op or condo and its management are not responsible if anything goes wrong and that the burden of risk is shifted to the resident. Insurance issues should be reviewed by the board. And consultation with counsel is essential to make sure the board does not ignore or mishandle a very serious and sensitive issue.
Read full articleFirst published: Apr 2023
Turn Down That Noise!Noise complaints in New York City are common, yet not easy to win. Often the line is subjective, and courts are sensitive to the notion that Big City life is not country life. But here, the plaintiff backed up her claim with objective proof that the noise at issue was particularly bad, and exceeded the Noise Code. Armed with evidence that this was not the usual noise generated in a large, complicated, and heavily populated metropolis, she prevailed and got an injunction. No small feat, and the case is worth examining to see what distinguishes a winning hand from a losing hand.
Read full articleFirst published: Apr 2023
Arbitration Rather Than LitigationThis case can revolutionize condo litigation. The arbitration clause in this case has appeared on commonly copied forms of bylaws for the past 40 years and has not generally been interpreted as it has in this case. Until now, practitioners have been satisfied that if the provisions in traditional condominium documents specifically direct that disputes on the respective provisions be arbitrated, the general arbitration clause had no effect. This is no longer a safe practice. Arbitration may become the new norm. This case has not yet been cited in any reported decision. Nor has a timely notice of appeal been filed within 30 days from the date of entry of the decision.
Read full articleFirst published: Mar 2023
Access: How Much Are You Offering?When sidewalk bridging (or other protection or scaffolding) must be installed on adjacent property, the property owners must negotiate an access agreement. But if the parties cannot agree on the terms of the agreement, the law permits the party needing access to bring a special proceeding under RPAPL §881, and the court will then decide what is reasonable. In light of the fact that no one can predict what a judge might do, it is best for both sides to be reasonable and to work hard towards an agreement that is fair to both parties. This is especially true when the value of property is easily ascertained, as was the case here, and where the monthly rent received was certainly a good indication of the value of the property per month.
Read full articleFirst published: Feb 2023
Attorney Fees: Who Will Foot The Bill?The specific language relating to attorney’s fees in proprietary leases matters! If the language in the proprietary lease only provided for fees when prosecuting a shareholder default (and not, as here, defending a shareholder claim) or such fees were not explicitly categorized as additional rent, it is very possible this case could have gone the opposite way and the bank would have priority over the cooperative. If your board has not reviewed the attorney fee language in your co-op’s proprietary lease recently, it would be wise to have your attorney do so. You want to make sure it maximizes protection for the co-op.
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