Case Notes in

Proprietary Lease

First published: Jun 2023
Much Ado About A Leak

While 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.

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First published: May 2023
Ground Lease Tsuris

This 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.

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First published: Feb 2022
Washing Machine

Boards should consult their governing documents and ensure sufficient notice is given, and even add a day or two as a cushion. Courts will not dismiss a case if too much notice is given instead of not enough. Boards should also make every effort to resolve disputes with their shareholders so that harmonious and mutually beneficial relationships cay be maintained.

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