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Council of New York Cooperatives & Condominiums
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Legal Issues

Published: Spring 1998

CNYC thanks Marc J. Luxemburg, Esq., for this column. A partner in the law firm of Snow Becker Krauss, Mr. Luxemburg was a founder of CNYC and serves as its president. His workshop discussing legal decisions of the prior year is featured at each year's Cooperative Housing Conference.


Courts Find in Favor of Co-ops and Condos
on a Variety of Common Issues
Every once in a while, a series of cases comes along in which cooperative and condominium boards emerge victorious. In the following decisions, courts found in favor of co-ops and condos on a variety of fairly common issues.

UNIT OWNER MUST SHARE COURTYARD
In Mirandi v. The 210 West 19th Street Condominium, N.Y.L.J., 3/16/98, p.26, c.3 (App. Div. 1st Dept), the plaintiff had purchased a duplex consisting of two condominium units, the lower one of which opened onto the 20-foot square rear courtyard of the building. Access to the courtyard could also be had from the rear fire escape of the building, and from an alleyway leading to the street into which the door to the building's laundry room opened. The plaintiff?s predecessors had erected an interior fence separating the courtyard from the alleyway, and placed outdoor furniture in the courtyard.

After he moved in, the managing agent informed plaintiff that the fence would have to be removed and the courtyard would have to be cleaned, even though his predecessor had been given a letter from the managing agent reflecting that the board had granted the predecessor the exclusive right to use the area. The plaintiff claimed that before he purchased the apartment he had been advised that he would enjoy exclusive use of the courtyard. However, the condominium bylaws permitted exclusive use of a common area only if it exclusively served the unit owner.

After the board voted to require the plaintiff to remove his property from the courtyard, he brought an action to enjoin the condominium from interfering with his use of the courtyard, or in the alternative to rescind the contract from his seller.

The court found that in view of the access to the courtyard from the fire escape and the laundry room, the rear courtyard did not serve the plaintiff exclusively. The court found that the letter to the predecessor in title was merely a personal convenience and not binding upon the condominium as against purchasers of the premises, and further found that since the contract of sale was silent as to the right of the plaintiff to obtain exclusive use of the rear yard, statements allegedly made by the brokers, or the seller, not incorporated into the contract were not binding. The court found that there was no likelihood of success on the merits against the condominium and dismissed the action against the seller.

FEAR OF LEAKS ISN'T GROUNDS FOR SUIT
In Silverman v. 145 Tenants Corp. N.Y.L.J., 3/23/98, p.26, c.4 (App. Div. 1st Dept), the plaintiff had sued the upstairs shareholder and the cooperative, alleging that his apartment had been damaged by a series of leaks caused by the overflowing of the upstairs neighbor's bathtub. In a prior decision, the lower court had dismissed the action against the upstairs neighbor, but allowed it to continue against the cooperative.

On this appeal, the court found that the leaks had not rendered plaintiff?s apartment uninhabitable, and found that there had not been any leaks after 1992. The only continuing damage alleged by plaintiff was his fear of using a particular light switch, which was not demonstrated to be in need of repair. His fear and anxiety that another flood would occur, and his unsupported claim that the upstairs neighbor's sinks and bathtub had inadequate drains, were found insufficient to establish a claim for injunctive or declaratory relief, and did not demonstrate any defect in the building?s plumbing. Accordingly, the Appellate Division directed that the complaint be dismissed.

DIRECTORS CAN DENY "LOW" PURCHASE PRICE
In Levine v. Yokell, N.Y.L.J., 1/14/98, p. 26, c. 5, (Sup. Ct. N.Y. Co.) plaintiff, a prospective purchaser of a cooperative apartment, sued the cooperative, its individual directors, and the managing agent claiming that the defendants wrongfully denied plaintiff's application to purchase, on the alleged ground that they believed that the purchase price was too low, and would devalue their own apartments. In a previous decision the court had dismissed the action as against the cooperative and its managing agent.

The present motion concerned the claims against the individual directors. Several causes of action alleged tortuous interference with the contract to purchase on the theory that the board members were acting in self-interest because the low purchase price would negatively affect their own apartments.

The court held that this did not state a basis for tortuous interference. Assuming that the economic considerations alleged were the basis for the rejection, tortuous interference requires an unjustified intent to harm, and an economic motive was inconsistent with such requirement. In addition, since the plaintiff was never a shareholder, the individual defendants did not owe any duty to act in good faith. Accordingly, the complaint was dismissed as against the directors.

 
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