Cooperatives & Condominiums

Condominium's Assessments For Capital Improvements

Rogan LLC v. YHD Bowery Commercial Unit LLC

NYLJ 7/16/14, p. 21, col. 1

Supreme Ct., N.Y. Cty.

(Bannon, J.)

In a declaratory judgment action brought by commercial tenant against owner of the leased condominium space, both parties sought summary judgment. The court granted tenant's partial summary judgment motion, holding that the lease did not obligate tenant to pay any portion of the condominium's assessment for capital improvements.

In 2008, tenant leased retail space on the first floor of a building for a seven-year term. Landlord subsequently converted the building to condominium ownership, and sold the retail unit. Purchaser of the retail unit took subject to tenant's lease. In 2013, the condominium's board approved a fa'ade restoration capital improvement assessment of nearly $3 million, and assessed the commercial space $858,169.15 as its share of the assessment. Owner of the retail unit demanded that commercial tenant pay 51.62% of that amount, but tenant refused. Tenant ultimately vacated the premises pursuant to a written stipulation reserving all rights and remedies. Tenant then brought this action for a declaration that it was not liable for any portion of the fa'ade restoration assessment.

In granting partial summary judgment to commercial tenant, the court emphasized language in the lease exempting tenant from contributing to costs for capital improvements, and in particular for costs incurred in connection with renovation projects underway and planned for the condominium project. Based on this language, the court concluded that commercial tenant was not liable for any or the renovation assessment.

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Condominium's Assessments For Capital Improvements

Rogan LLC v. YHD Bowery Commercial Unit LLC

NYLJ 7/16/14, p. 21, col. 1

Supreme Ct., N.Y. Cty.

(Bannon, J.)

In a declaratory judgment action brought by commercial tenant against owner of the leased condominium space, both parties sought summary judgment. The court granted tenant's partial summary judgment motion, holding that the lease did not obligate tenant to pay any portion of the condominium's assessment for capital improvements.

In 2008, tenant leased retail space on the first floor of a building for a seven-year term. Landlord subsequently converted the building to condominium ownership, and sold the retail unit. Purchaser of the retail unit took subject to tenant's lease. In 2013, the condominium's board approved a fa'ade restoration capital improvement assessment of nearly $3 million, and assessed the commercial space $858,169.15 as its share of the assessment. Owner of the retail unit demanded that commercial tenant pay 51.62% of that amount, but tenant refused. Tenant ultimately vacated the premises pursuant to a written stipulation reserving all rights and remedies. Tenant then brought this action for a declaration that it was not liable for any portion of the fa'ade restoration assessment.

In granting partial summary judgment to commercial tenant, the court emphasized language in the lease exempting tenant from contributing to costs for capital improvements, and in particular for costs incurred in connection with renovation projects underway and planned for the condominium project. Based on this language, the court concluded that commercial tenant was not liable for any or the renovation assessment.

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