Adam Leitman Bailey, P.C. Obtains Quick Repair Order for Proprietary Lessee Against Cooperative Through Housing Part Action After Taking Over as Counsel In Delayed Supreme Court Action
It is a common story in New York real estate: a shareholder in a New York City cooperative apartment building is the victim of an unresponsive Board that refuses to make necessary repairs to common elements or damage cause by its own inaction and turns to legal counsel for justice. Unfortunately, when those attorneys are not regularly deep “in the dirt” of real estate law, their advice can regularly cost the shareholder tens of thousands of dollars in unnecessary fees and years of unwanted delays, all while their apartment often remains uninhabitable. However, Adam Leitman Bailey, P.C. handles such cases on a daily basis and has the experience, skills, and knowledge of the New York court system to greatly reduce costs, in both time and money, and force cooperative boards to make necessary repairs at their own expense by utilizing a multi-pronged approach in multiple New York courts.
Recently, Adam Leitman Bailey, P.C. had the privilege of helping a savvy shareholder in a New York City cooperative building address precisely these sorts of issues: the shareholder’s apartment was suffering a heavy mold infestation and severe physical damage after repeated and dramatic flooding from an adjoining terrace owned by the cooperative that resulted from the cooperative’s failure to maintain the terrace over multiple decades. Indeed, even a cursory inspection of the terrace showed severe cracks in the terrace surface, degradation in pitch forcing water towards the unit, and failure of waterproofing that allowed active penetration of water from the terrace into the shareholder’s apartment at any rainfall. The situation was so dramatic that the shareholder’s dog could literally swim on the terrace after a heavy rainfall. As a result of this continuous water infiltration, the shareholder’s apartment was uninhabitable, with extreme degradation of her flooring and plaster, and documented dangerous mold levels.
Over the course of many years, the shareholder attempted to convince the cooperative board to do its fiduciary and contractual duties and fix the problem. However, the board was at best non-responsive, and at worst contemptuous, refusing to accept any responsibility; and, instead accusing the shareholder of causing the water damage by leaving a door ajar, while all the evidence indicated infiltration through the wall and floor of the unit directly from the adjacent terrace surface. The cooperative also refused to commence any repairs unless the shareholder agreed to front expenses for all repair costs.
The shareholder hired well-regarded litigation counsel who, as often is the case, approached the claim as a standard contractual dispute, filing a supreme court complaint for breach of the proprietary lease, among other things, in an attempt to force the cooperative to repair the negotiate damages. However, absent any petition for emergency relief, building violations, or court orders, the cooperative board reacted as they typically do: with delays, inaction, and accusations against the shareholder, rather than any attempt to mitigate the situation, which grew more dire every day.
Forced to abandon the apartment for health reasons, and facing the cooperative board’s increasingly aggressive demands that the shareholder pay maintenance fees on the uninhabitable unit (which the shareholder had been withholding during the period of uninhabitability), the shareholder reached out to Adam Leitman Bailey, P.C. for guidance. At first working with prior counsel, and then on its own, Adam Leitman Bailey, P.C. developed a three-prong attack: (1) develop a strong evidentiary record supporting the damage to the apartment, (2) move through New York’s housing part to have the apartment inspected by city agencies and then have any violations presented to a judge, which (3) would force the cooperative to make all repairs at its own initial costs in a timely manner.
Adam Leitman Bailey, P.C. first leveraged its contact and experience to quickly pressure the board to allow the shareholder to conduct a water test on the terrace – which it had refused to permit before that point. With the damning results of the water testing and a similarly devastating mold report documenting the source of the leakage from the terrace and its impact on the apartment and its habitability, Adam Leitman Bailey, P.C. approached board counsel with an opportunity to avoid further litigation. However, the board doubled down, threatening the shareholder with ever more severe repercussions and refusing to consider shouldering any of the repair cost even to the terrace that the cooperative owned.
Realizing that negotiation was fruitless, Adam Leitman Bailey, P.C. quickly moved into action, filing an exhaustive petition – which cited to the mold and water test reports – and order to show cause for expedited relief in New York City civil court’s specialized housing part. An “HP” action is a special mechanism that allows a tenant – including a cooperative shareholder – to ask the judge to force a landlord to make necessary repairs quickly and at its own costs without any up-front expenses by the tenant (even if the tenant is later found responsible for a share of such expenses). As part of the HP petition, ALBPC – knowing, of course, that the water and mold infiltration were clear violations of housing and building code – requested that New York City housing and building inspectors visit the apartment in order to assess any potential violations, which the court immediately endorsed. Unsurprisingly, both inspections resulted in numerous, and severe, code violations including that the cooperative had failed to adequately maintain the terrace and its pitch resulting in water infiltration to the shareholder’s apartment; and within days of the inspections, and based on these violations, the Court promptly ordered that the cooperative repair and remediate the cause of the infiltration and all resulting damage, at its own up-front cost, or risk contempt of court.
As a result, the cooperative promptly engaged engineers and has agreed to undertake, at its own up-front cost, to repair all of the conditions cited in the numerous violations. The HP order further enables the shareholder to now seek all of its attorneys’ fees related to the HP Action – meaning that the cooperative will, in essence, pay a majority of Adam Leitman Bailey, P.C.’s fees as a result of its own intransigence. Finally, the HP order and violations provide strong evidence that the shareholder can use to support its damages claim in the related Supreme Court action, which now has far more teeth.
Eric S. Askanase and Dov Treiman, and Charles W. McMellon, represented the shareholder landlord in this successful proceeding.