Case Notes in
Sponsor
Category
- Access
- Alterations
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- Third-Party Liability
- Transfers
- Trespassing
- Trial Practice
- Violations
- Warranty of Habitability
- Yellowstone Injunction
- Zoning
First published: Mar 2013
The Board of Managers of the Lore Condominium v. Steven Gaetano and Lore GaetanoThis case is significant because it addresses many of the issues typically raised in a case where a plaintiff claims construction defects, and does so in a circumstance where the Gaetano family played many roles in the conversion, something that is, in our experience, not the norm. The court discussed the impact and import of Mr. Gaetano signing certifications that are required by the Office of the Attorney General – both in his capacity as sponsor and in his capacity as architect. Consistent with other cases we have seen, the court found that the architect’s certification did not expose Mr. Gaetano to liability for fraud in his capacity as an architect and determined that only the attorney general had the right to sue him for fraud, in accordance with the Martin Act. However, when Mr. Gaetano signed a certification in his capacity as a principal of sponsor, it did expose him to potential liability for breach of contract, consistent with other case law. Here, the court not only held that there was potential personal liability relating to alleged construction defects, but also to the sponsor’s failure to pay common charges. These claims were not precluded by the Martin Act. As to the fraud claims, they were duplicative of the breach of contract claims and were dismissed for that reason.
Read full articleFirst published: Apr 2011
The Plaza PH2001 LLC v. Plaza Residential Owner LPThe lower courts have not always been consistent in their interpretation of no-representation clauses similar to the one at issue in this case. Here, plaintiff was shown a mock-up and a virtual computer rendering of the apartment. Yet, because this was done before plaintiff entered into its purchase agreements, and because the purchase agreements contained the “no representation” language, the court determined that plaintiff had no right to rely on the mock-up. Had the mock-up been made an exhibit to the contract, or had the terms of the contract included the specific representations plaintiff claimed the sponsor had made, we believe the decision might have been different. In addition, plaintiff failed to allege all potential causes of action in the 2008 action. Because of the legal principle of “res judicata,” plaintiff could not take a second bite of the apple and relitigate the same facts through different causes of action. Indeed, the claims plaintiff made in the second action included alleged violations of the Martin Act and the Interstate Land Sales Full Disclosure Act, neither of which had been argued in the 2008 action. However, because the factual basis of these claims had been litigated and fully and finally decided, the court refused to consider them in the 2010 action. We do not know how the court would have considered these specific claims had they been brought in the 2008 action. We understand that the decision from the 2008 action has been appealed to the appellate division. We will wait to see whether that court agrees with the lower court that the no-representation language in the purchase agreements precludes plaintiff from maintaining an action for a return of the down payments. Further, if the 2010 decision is similarly appealed, we await the appellate court’s advice on whether any of the new claim can survive notwithstanding the decision in the 2008 case. This case cautions buyers. If purchasing an apartment that is not yet built, and if you are purchasing because of representations made concerning the layout, size, number of windows, number of skylights, etc. – make sure it is in writing and is attached and incorporated into the purchase agreement. It is also a caution to all litigants that all claims be asserted at the time of the initial action so that they are not precluded by the doctrine of res judicata.
Read full articleFirst published: Apr 2011
The Plaza PH2001 LLC v. Plaza Residential Owner LPThe lower courts have not always been consistent in their interpretation of no-representation clauses similar to the one at issue in this case. Here, plaintiff was shown a mock-up and a virtual computer rendering of the apartment. Yet, because this was done before plaintiff entered into its purchase agreements, and because the purchase agreements contained the “no representation” language, the court determined that plaintiff had no right to rely on the mock-up. Had the mock-up been made an exhibit to the contract, or had the terms of the contract included the specific representations plaintiff claimed the sponsor had made, we believe the decision might have been different. In addition, plaintiff failed to allege all potential causes of action in the 2008 action. Because of the legal principle of “res judicata,” plaintiff could not take a second bite of the apple and relitigate the same facts through different causes of action. Indeed, the claims plaintiff made in the second action included alleged violations of the Martin Act and the Interstate Land Sales Full Disclosure Act, neither of which had been argued in the 2008 action. However, because the factual basis of these claims had been litigated and fully and finally decided, the court refused to consider them in the 2010 action. We do not know how the court would have considered these specific claims had they been brought in the 2008 action. We understand that the decision from the 2008 action has been appealed to the appellate division. We will wait to see whether that court agrees with the lower court that the no-representation language in the purchase agreements precludes plaintiff from maintaining an action for a return of the down payments. Further, if the 2010 decision is similarly appealed, we await the appellate court’s advice on whether any of the new claim can survive notwithstanding the decision in the 2008 case. This case cautions buyers. If purchasing an apartment that is not yet built, and if you are purchasing because of representations made concerning the layout, size, number of windows, number of skylights, etc. – make sure it is in writing and is attached and incorporated into the purchase agreement. It is also a caution to all litigants that all claims be asserted at the time of the initial action so that they are not precluded by the doctrine of res judicata.
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: Jan 2002
The Residential Board of Managers of the 99 Jane Street Condominium v. Rockrose Development Corp.This case left the board with a cause of action against the sponsor of the condominium plan for the building. However, the sponsor might be without assets or insolvent. Even if the sponsor could be induced to instigate a legal proceeding to place ultimate liability on the various designers and contractors, this might still result in substantial delays for the board to press its claim.
Read full article