1050 Tenants Corp. v. Lapidus

39 A.D.3d 379, 835 N.Y.S.2d 68
CourtAppellate Division of the Supreme Court of the State of New York
DecidedApril 24, 2007
StatusPublished
Cited by13 cases

This text of 39 A.D.3d 379 (1050 Tenants Corp. v. Lapidus) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
1050 Tenants Corp. v. Lapidus, 39 A.D.3d 379, 835 N.Y.S.2d 68 (N.Y. Ct. App. 2007).

Opinion

Order and judgment (one paper), Supreme Court, New York County (Marylin G. Diamond, J.), entered June 19, 2006, which, inter aha, granted plaintiffs motion for summary judgment on its cause of action for ejectment, unanimously affirmed, with costs.

[380]*380In 1983, defendants Steven and Iris Lapidus purchased the shares allocated to the proprietary lease for apartment 4B in plaintiff cooperative’s building. Beginning in 1992, defendants, claiming unremedied conditions in their apartment, withheld payments for maintenance, electricity and special assessments, repeatedly and for extended periods of time. The cooperative brought multiple nonpayment proceedings, which, either by court order or settlement stipulation, resulted in the defendants’ payment of over $170,000 in arrears and more than $400,000 in attorneys’ fees.

Litigation History

In a 1992 nonpayment proceeding, the Housing Court (Marilyn Shafer, J.) awarded the cooperative $43,834.24 in arrears and denied the Lapiduses any abatement, after discrediting their testimony that “they would allow themselves to live in fear and with terrible conditions for years on end without taking any affirmative steps to correct the problems,” and finding their other assertions either unsubstantiated or pertaining to purely cosmetic appearances in the common areas. The court found defendants’ arguments particularly incredible in light of the fact that Mr. Lapidus is an experienced real estate and landlord-tenant lawyer. After a protracted hearing on attorneys’ fees for that case, the Civil Court (Martin Shulman, J.) commented on defendants’ “obduracy,” “needless and groundless pre-trial motion practice,” attempts to “delay or derail the underlying proceeding . . . , implicitly designed to economically force the Coop to its ‘knees,’ ” and the cooperative’s “total victory”; following an appeal, defendants stipulated to pay $328,655.84 in attorneys’ fees, plus interest.

Before the issue of attorneys’ fees in the first action was resolved, the cooperative commenced a second nonpayment proceeding, in 1995, as a result of which the Housing Court (Howard Malatzky, J.) directed defendants to pay $55,681.81 in arrears, offset by $3,340.91 as a rent abatement, thereby totaling $52,340.90. In addition, the court awarded the cooperative $115,000 in attorneys’ fees and over $15,000 in prejudgment interest, later reduced by stipulation to $75,000 in fees and $6,000 in interest.

Another nonpayment proceeding, brought in 1999, was settled by stipulation, so ordered by the court (Bruce Kramer, J.), in which defendants paid $16,098.29 in arrears, and the cooperative credited their account $10,000 to replaster walls and ceilings, hang new wallpaper, and clean a carpet. Defendants further agreed that “under no circumstances” would they withhold payment of electric charges, and that they would not withhold [381]*381maintenance or additional assessments unless they first sent written notice to the cooperative’s managing agent, superintendent and attorneys; allowed the cooperative 10 business days from the date of notice to cure; commenced a Housing Part proceeding if the cooperative failed to cure; and substantially prevailed in the Housing Part proceeding.

Notwithstanding that stipulation, defendants thereafter withheld payments for maintenance and additional assessments without complying with the agreed-upon procedures, and withheld payments for electricity. In a subsequent nonpayment proceeding, the Housing Court (Gerald Lebovits, J.) found incredible Mr. Lapidus’s testimony that he never knew about the stipulation, “even though he was a partner of a law firm, he specialized in real estate law, an associate of his firm signed the stipulation, he received a $10,000 abatement, he was involved in a great deal of litigation with his cooperative, and he knew that his case ended the day his associate appeared in court.” The court also rejected the Lapiduses’ argument that their tendering maintenance for a single month constituted a defense to withholding payments for many months. The court issued a judgment in favor of the cooperative in the amount of $59,270.69, plus interest.

Not only did defendants disregard their obligations under the stipulation, but they also installed, without permission of the cooperative, a water-cooled air conditioning system, which caused substantial water damage to the apartment and personal property of the shareholder-tenant below. The Lapiduses ignored the protestations of their neighbor and denied the cooperative access to inspect the system, compelling the cooperative and the neighbor to bring separate actions, later consolidated, against them.

By stipulation dated September 30, 2002, so ordered by Supreme Court (Marylin G. Diamond, J.), defendants agreed to disconnect their water-cooled air conditioning units from the building’s water supply and drain lines and to cap those lines. They further agreed to pay $7,345.94 in arrears of maintenance and electric charges through October 2002. The cooperative placed $15,000 in escrow to reimburse defendants for the costs of removing the system and replacing it with an air-cooled one.

Even though the cooperative deposited the funds in escrow to underwrite the replacement of the air conditioning system, the Lapiduses refused to honor their obligations under the stipulation, and on February 4, 2003, Justice Diamond found them in contempt for failure to abide by the terms of the stipulation and directed them to disconnect their water-cooled air conditioning [382]*382system. By order and judgment entered October 29, 2004, Justice Diamond adjudged them in contempt a second time, vacated the stipulation, directed that the funds in escrow be returned to the cooperative, permitted the cooperative to retain the Lapiduses’ payment of arrears of $7,345.94, and issued a permanent injunction that the Lapiduses remove their water-cooled air conditioning system.

Thereafter, the cooperative’s board of directors sent defendants written notice of a special meeting of the board to consider a resolution to terminate their proprietary lease, pursuant to section 34 (e) of the lease, “on the grounds that the tenancy of the [Lapiduses] is undesirable,” due to their chronic withholding of maintenance and other payments, the nuisance of installing and refusing to dismantle a water-cooled air conditioning system that caused damage to their downstairs neighbor, and the protracted litigation in which defendants’ arguments were repeatedly found to be meritless and in bad faith. At the special meeting, where counsel appeared on defendants’ behalf, the board unanimously adopted the resolution.

Defendants threatened to sue any shareholder who voted to terminate their tenancy, and therefore the board enacted a resolution to indemnify and hold harmless the shareholders. At the special shareholders’ meeting to consider the resolution to terminate defendants’ proprietary lease, defendants’ counsel warned the shareholders of “the serious legal consequences” and “substantial liability” that would befall them should they “choose to evict the Lapiduses.” Nevertheless, 98% of the shares voted in favor of the resolution.

Defendants refused to vacate their apartment, and the cooperative commenced this action for, inter alia, ejectment and attorneys’ fees. Justice Diamond, well acquainted with the history of the case, granted the cooperative summary judgment on the ejectment cause of action and referred the issue of attorneys’ fees to a special referee.

Discussion

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Rivercross Tenants' Corp. v. Kovach
2023 NY Slip Op 00285 (Appellate Division of the Supreme Court of New York, 2023)
111-15 75th Ave. Owners Corp. v. Min Fan
72 Misc. 3d 139(A) (Appellate Terms of the Supreme Court of New York, 2021)
800 Grand Concourse Owners, Inc. v. Thompson
72 Misc. 3d 129(A) (Appellate Terms of the Supreme Court of New York, 2021)
811 Walton Tenants Corp. v. 811 Walton Rescue LLC
Appellate Terms of the Supreme Court of New York, 2018
Lapidus v. 1050 Tenants Corp.
138 A.D.3d 783 (Appellate Division of the Supreme Court of New York, 2016)
Gordon v. 476 Broadway Realty Corp.
129 A.D.3d 547 (Appellate Division of the Supreme Court of New York, 2015)
U.S. Bank National Ass'n v. APP International Finance Co.
100 A.D.3d 179 (Appellate Division of the Supreme Court of New York, 2012)
Hirschmann v. Hassapoyannes
52 A.D.3d 221 (Appellate Division of the Supreme Court of New York, 2008)
1050 Tenants Corp. v. Lapidus
16 Misc. 3d 70 (Appellate Terms of the Supreme Court of New York, 2007)
Breezy Point Cooperative, Inc. v. Young
16 Misc. 3d 101 (Appellate Terms of the Supreme Court of New York, 2007)

Cite This Page — Counsel Stack

Bluebook (online)
39 A.D.3d 379, 835 N.Y.S.2d 68, Counsel Stack Legal Research, https://law.counselstack.com/opinion/1050-tenants-corp-v-lapidus-nyappdiv-2007.