Case Notes by
Thomas P. Higgins, Higgins & Trippett LLP
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: May 2024
The Four-Year LeakThe plaintiff, a corporation, sued the board of managers of 580 Carroll Street for breach of fiduciary duty, negligence, and breach of bylaws, and the court found that the board was liable for breach of contract for failing to "promptly" repair the façade.
Read full articleFirst published: Feb 2024
In Guaranties We TrustTAKEAWAY Based on a change in federal law back in 1986, many cooperative shareholders have sought to transfer their shares to a trust, for tax or estate purposes. When a board is faced with such a request, there is much to be said for simply refusing it, as well as all similar requests. Cooperative living has always contemplated ownership by, and a community of, individuals, not trusts and their beneficiaries. Trusts are actually not legal entities per se, like LLCs or corporations, and a trust might better be described as a legal arrangement by which a trustee holds title to property and administers it for the benefit of beneficiaries. The complications that can arise from dealing with an apartment that is held by a trust are not insignificant, and since there is no upside to the cooperative itself if the shares are held by a trust, denial of the request outright may be the cleanest and best option for a board. Still, if a board were inclined to allow ownership of apartments by trusts, they would be wise to follow the path chosen by the plaintiff in this case. Here, the cooperative demanded and got a solid, well-crafted, and unconditional guaranty of payment by a solvent individual. As this case demonstrates, the courts will hold a guarantor liable for unpaid maintenance plus attorneys’ fees, and the cooperative does not have to wait around to get paid until trust and estate issues are resolved in Surrogate’s Court.
Read full articleFirst published: Aug 2023
What You Buy May Not Be What You GetTAKEAWAY The issues resolved by the court may wander a bit into the legal weeds—third-party complaints, common law indemnification, distinction between contract and professional malpractice claims—yet practitioners in the field, as well as board members, might take away at least two pointers. First, the responsibility for problems that unit owners might experience, especially in newly constructed or newly renovated buildings, may not be so easy to isolate or define. This lawsuit shows the many levels of legal responsibility that might exist for leakage and noise issues, such as professional design, construction, remediation, or maintenance. Second, the lawsuit shows that no matter how glossy the brochure, how exclusive the street address or how expensive the apartment, a residence is only as good as the level of care that went into its design, construction and maintenance. Your building may be a small walk-up in Brooklyn, but don’t hesitate to keep it well maintained by professionals. Also, take some comfort that you’re not swaying in the wind in a noisy and leaky apartment, several hundred feet above the street.
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: Dec 2022
The Well-Documented Process WinsThe famous Pullman case, decided by New York’s Court of Appeals in 2003, confirmed a co-op’s right, as contained in most proprietary leases, to terminate a shareholder for objectionable conduct. Termination sometimes requires a vote by shareholders but other times only the vote of the board, as occurred here. Provided that all necessary steps in the process are followed, that there are facts showing objectionable conduct, and that there are no other indications of chicanery (a board motivated by personal gain, or acting in a legally discriminatory manner such as racial bias), the business judgment rule will insulate from judicial review the termination of a shareholder’s lease. Here, the plaintiff tried to get the court to stop the process from moving forward, which was denied. The hallmark of co-operative living is that all members of the community have agreed, by binding contract, to follow the rules or suffer the consequences, one of which is removal from the community. Whether the co-op’s termination of the lease is upheld remains to be seen, but things are not looking good for this shareholder.
Read full articleFirst published: Jun 2022
A Dog Fight: Commercial Board vs Residential BoardOuch, two big lessons. One, do not ignore a lawsuit. Your first call upon learning of a lawsuit must be to an attorney, there will be time to try to settle it later. Two, don’t present the court with a story that can be refuted by your own emails. The court’s decision bristles with umbrage at the demonstrably misleading statements of the defendant, and the individual is lucky the court was satisfied with denying the motion. The court might have issued sanctions.
Read full articleFirst published: Feb 2022
Water LeakUnlike a co-op shareholder, a condo owner is not a lessee under a proprietary lease, and is not protected by the statutory warranty of habitability. Under this protection, a co-op shareholder can withhold rent if his or her apartment becomes unlivable due to damage, but a condo owner does not have that right. The condo owner can't withhold common charges, even if there is a damage claim for alleged water leaks. But note that the Judge, by holding the money judgment in abeyance, essentially gave the unit-owner a reprieve on paying common charges while the lawsuit was pending, undercutting the principle that was supposedly being exalted. It is a curious decision, one that properly states and applies the law but then, in a twist of fate worthy of M. Night Shyamalan, undoes it all in the penultimate sentence.
Read full articleFirst published: Feb 2022
Nelson V. Board Of Managers Of The 32 East 1st Street CondominiumWHAT YOU NEED TO KNOW Unlike a co-op shareholder, a condo owner is not a lessee under a proprietary lease, and is not protected by the statutory warranty of habitability. Under this protection, a co-op shareholder can withhold rent if his or her apartment becomes unlivable due to damage, but a condo owner does not have that right. The condo owner can't withhold common charges, even if there is a damage claim for alleged water leaks. But note that the Judge, by holding the money judgment in abeyance, essentially gave the unit-owner a reprieve on paying common charges while the lawsuit was pending, undercutting the principle that was supposedly being exalted. It is a curious decision, one that properly states and applies the law but then, in a twist of fate worthy of M. Night Shyamalan, undoes it all in the penultimate sentence.
Read full article