Justia Real Estate & Property Law Opinion Summaries

A property owner sought to develop a parcel of land in a town, which required rezoning and environmental review. In 2017, while preparing its zoning petition, the owner and the town entered into a memorandum of understanding (MOU) that purported to bind the town and its successors to continue reviewing the zoning petition until a final determination was reached, based on empirical data. The owner submitted its petition and participated in the environmental review process, investing significant resources. After local elections in 2019, a new town supervisor and board, who opposed the project, voted to terminate review of the zoning petition and the related environmental process.The property owner filed suit against the town, its board, and the supervisor, alleging breach of contract and breach of the implied covenant of good faith and fair dealing, based on the town’s termination of the review process. The defendants moved to dismiss, arguing that the MOU was unenforceable under the term limits doctrine and contract zoning doctrine. The Supreme Court, Dutchess County, dismissed the complaint, holding the MOU invalid. The Appellate Division, Second Department, affirmed that decision.The New York Court of Appeals reviewed the case after granting leave to appeal. The Court held that the MOU was invalid and unenforceable under the term limits doctrine because it impermissibly bound successor town boards in the exercise of their legislative discretion over zoning matters. The Court found that such an agreement was not specifically authorized by statute or charter, and did not fall within an exception for proprietary acts. As a result, the property owner’s contractual claims failed as a matter of law. The Court affirmed the Appellate Division’s order. View "Hudson View Park Co. v Town of Fishkill" on Justia Law

The case involves an individual who left his Florida residence in August 2018 to care for his terminally ill brother, a tenant in a New York City Mitchell-Lama apartment. After the brother’s death in March 2020, the petitioner sought succession rights to the apartment, which required him to prove that the apartment was his primary residence for at least one year prior to his brother’s death. The petitioner submitted various documents, including income certifications, power of attorney forms, and certain public assistance records. However, some materials listed his Florida address, and much of his supporting documentation either fell outside the relevant one-year period or was not addressed to the apartment in question.The housing company denied his application, concluding that he failed to establish primary residency during the required time. The New York City Department of Housing Preservation and Development (HPD) upheld this decision after an administrative appeal, finding the evidence insufficient. The petitioner then challenged the agency’s determination through a CPLR article 78 proceeding. The Supreme Court annulled the agency’s decision and granted succession rights, ruling the denial irrational. On appeal, the Appellate Division reversed, holding that the agency’s denial had a rational basis, especially given the petitioner’s failure to supply certain key documents such as New York State tax returns or proof of exemption.The New York Court of Appeals affirmed the Appellate Division’s decision. The Court held that, under the applicable regulations, the agency’s determination that the petitioner failed to prove the apartment was his primary residence for the required period was supported by a rational basis. The Court emphasized that the agency’s decision was neither arbitrary nor capricious, and the evidence provided by the petitioner did not meet the burden required to establish primary residency for succession rights. The order dismissing the petition was affirmed. View "Matter of Mantilla v New York City Dept. of Hous. Preserv. & Dev." on Justia Law

A carpenter employed by a subcontractor was injured after falling from a ladder owned by another subcontractor, DAL Electrical Corporation, while working on a renovation project at an office building. The injured worker was using his own employer’s equipment in the morning but, after lunch, returned to the worksite without his equipment and used an unattended DAL ladder, which was defective and marked with blue tape. He was injured when the ladder wobbled and he fell, impaling himself on a tool in his belt. The worker brought claims under New York Labor Law and for common-law negligence against the project’s general contractor, premises owner, and DAL, asserting the defective ladder caused his injuries. The general contractor and owner sought indemnification from DAL under their subcontract.The Supreme Court of Bronx County granted the worker’s motion for partial summary judgment on one Labor Law claim and denied DAL’s motion to dismiss other claims and cross-claims by the general contractor and owner. The court also granted the general contractor and owner summary judgment on their contractual indemnification claim against DAL. The Appellate Division, First Department, modified this order by denying summary judgment on contractual indemnification and granting summary judgment for DAL on all claims and cross-claims against it. The general contractor and owner appealed to the New York Court of Appeals.The New York Court of Appeals affirmed the Appellate Division’s decision. The Court held that none of the indemnification provisions in the subcontract required DAL to indemnify the general contractor or owner for the worker’s injuries because the injuries did not arise from DAL’s performance of its contractually defined work. The Court also found that DAL did not owe a duty of care in tort to the injured worker, as the facts did not fit within any recognized exception to the general rule against extending contractual duties to non-contracting third parties. The certified question was answered in the affirmative. View "Dibrino v Rockefeller Ctr. N., Inc." on Justia Law

A company that owns and operates the only landfill in a particular town challenged a local law that required the landfill’s closure by a specified date. The law was enacted after community complaints regarding odors. When the law was first passed, the town’s attorney acknowledged that a State Environmental Quality Review Act (SEQRA) review was required, but the Board adopted the law and related SEQRA documents without substantive discussion. After a subsequent law rescinded and then court action reinstated the original law, the landfill owner again brought a proceeding, claiming, among other things, that the Board failed to comply with SEQRA by not taking a “hard look” at environmental impacts.The Supreme Court initially dismissed the action on statute of limitations grounds, but the Appellate Division, Fourth Department, reversed that decision, holding the claim was timely. After the parties resolved all non-SEQRA claims, Supreme Court granted summary judgment to the landfill owner, finding it had standing and that the Board did not properly comply with SEQRA. The Appellate Division reversed, concluding the owner lacked standing because it had not shown it suffered or would suffer an environmental injury. The dissent argued that under Matter of Har Enterprises v Town of Brookhaven and Gernatt Asphalt Products v Town of Sardinia, property owners directly affected by a government action do not need to allege environmental harm to have standing under SEQRA.The New York Court of Appeals held that the landfill owner has standing to challenge the Board’s SEQRA compliance simply by virtue of owning property directly affected by the local law, following the holdings in Har Enterprises and Gernatt Asphalt Products. The Court further declined to review the statute of limitations argument at this stage, as that issue had already been resolved and was not properly before it. The Court of Appeals reversed the Appellate Division’s order and remitted the case for further proceedings. View "Seneca Meadows, Inc. v. Town of Seneca Falls" on Justia Law

The case concerns a borrower who executed a promissory note and mortgage in 2007, defaulted on the loan in 2009, and faced a foreclosure action that same year by the lender's predecessor. The 2009 foreclosure action included an explicit acceleration of the loan, but the lender’s standing was disputed due to the timing of the assignment of the note and mortgage. The foreclosure case lingered for over a decade, during which the mortgage and note changed hands and were eventually assigned to the current lender. In 2022, the foreclosure action was voluntarily discontinued without prejudice. Shortly thereafter, the borrower brought a quiet title action, contending that the six-year statute of limitations had expired, making further foreclosure unenforceable. The lender then initiated a new foreclosure action, which was also pending.In the Supreme Court of New York County, the lender argued that the loan was never validly accelerated due to lack of standing in the original case. The borrower sought summary judgment, asserting that under the recently enacted Foreclosure Abuse Prevention Act (FAPA), the limitations period had expired. While the motions were pending, FAPA took effect. The Supreme Court found that FAPA applied retroactively, estopped the lender from challenging the validity of the 2009 acceleration, and granted judgment for the borrower, cancelling the mortgage. The Appellate Division unanimously affirmed this decision.The New York Court of Appeals reviewed the case. It held that FAPA’s relevant provisions (sections 4, 7, and 8) apply retroactively to pending actions and do not violate the federal Due Process or Contract Clauses. The Court found that FAPA validly estops the lender from disputing the prior acceleration and that the limitations period had expired, supporting quiet title relief for the borrower. The order of the Appellate Division was affirmed. View "Van Dyke v U.S. Bank, Natl. Assn." on Justia Law

In this case, the dispute centered on a Brooklyn property subject to both senior and junior mortgages. After the original borrower defaulted on the senior mortgage, a loan servicer (Central Mortgage Company) commenced a foreclosure action in 2007 but later discontinued it without prejudice in 2017. Subsequently, Article 13 LLC acquired the junior mortgage and, in 2020, filed a quiet title action in federal court seeking to have the senior mortgage canceled as time-barred under New York’s statute of limitations.The United States District Court for the Eastern District of New York initially found that there were material factual disputes regarding whether the servicer actually held the note at the time it commenced the 2007 foreclosure, denying both parties’ motions for summary judgment. Shortly thereafter, the New York Legislature enacted the Foreclosure Abuse Prevention Act (FAPA), which clarified the statute of limitations for mortgage foreclosures and addressed abusive litigation practices. Article 13 LLC moved for reconsideration, arguing the new law applied retroactively. The district court agreed, concluding that FAPA retroactively applied and precluded the senior mortgage holder from contesting the validity of the prior foreclosure acceleration, and further held that this retroactive effect did not violate due process rights.On appeal, the United States Court of Appeals for the Second Circuit certified two questions to the New York Court of Appeals regarding the retroactive application of FAPA and its consistency with the New York Constitution’s due process protections. The New York Court of Appeals held that FAPA applies to all foreclosure actions in which a final judgment of foreclosure and sale had not been enforced before its effective date, including those pending at the time of enactment. The court further held that FAPA’s retroactive application does not violate substantive or procedural due process under the New York Constitution. View "Article 13 LLC v Ponce De Leon Fed. Bank" on Justia Law

A nonprofit religious organization based in Queens purchased a 73-acre parcel in the Town of Callicoon, Sullivan County, in 2018. Although the organization originally intended to use the property as a retreat center, testimony established that its actual use involved farming vegetables on about one cleared acre for charitable distribution to low-income residents in Queens. Occasional overnight stays involved religious activities, but there was no evidence of regular organized religious services or use as a retreat center. The Town Supervisor, who lived nearby and farmed part of the property without a formal agreement, confirmed the farming use but did not observe overnight retreats.After the Town Assessor denied a religious use tax exemption for the property for the 2021 tax year, the organization filed a grievance complaint, which was denied by the Town’s Board of Assessment Review. The organization then initiated an RPTL article 7 proceeding in Supreme Court, challenging the denial. A similar process occurred for the 2022 tax year, and both proceedings were joined. Supreme Court held a nonjury trial, found all witnesses credible, credited the organization’s testimony about actual use, and granted the petitions for both tax years, concluding the property was exempt. The Appellate Division affirmed this decision, with one Justice dissenting.The New York Court of Appeals reviewed the case. It held that the lower courts applied the correct legal standards: the burden to prove entitlement to exemption rests with the party seeking it, while the burden to prove a zoning violation rests with the municipality. The Court of Appeals found record support for Supreme Court’s factual findings and concluded that the Town failed to prove a zoning violation sufficient to defeat the exemption for both years. The order of the Appellate Division was affirmed, with costs. View "Matter of First United Methodist Church in Flushing v Assessor, Town of Callicoon" on Justia Law

A commercial landlord and tenant entered into a lease for office space, which was later amended to include a limited personal guaranty by an officer of the tenant. The guaranty, often referred to as a "good guy" guaranty, stated that the guarantor would be liable for the tenant’s monetary obligations under the lease up to the date the tenant and its affiliates had completely vacated and surrendered the premises, provided the landlord was given at least thirty days’ notice. The tenant stopped paying rent and utilities in 2020, notified the landlord of its intent to vacate, and surrendered the premises at the end of November 2020.The landlord sued both the tenant and the guarantor in the Supreme Court, New York County, seeking unpaid rent and expenses from before and after the surrender, as well as attorneys’ fees. The Supreme Court initially granted summary judgment to the landlord for pre-vacatur damages but denied summary judgment for post-vacatur damages pending further discovery. Upon reargument, the Supreme Court granted summary judgment for post-vacatur damages as well, holding both the tenant and guarantor jointly and severally liable. The Appellate Division, First Department, affirmed, reasoning that the guaranty required the landlord’s written acceptance of the surrender for the guarantor’s liability to end.The New York Court of Appeals reviewed the case and reversed the lower courts’ decisions. The Court of Appeals held that, under the terms of the guaranty, the guarantor’s liability ended when the tenant vacated and surrendered the premises, and that liability was not conditioned on the landlord’s acceptance of the surrender. The court found that the language of the guaranty was clear and did not require the landlord’s written acceptance, and that interpreting it otherwise would render key provisions superfluous. The court denied the landlord’s motions for summary judgment on post-vacatur damages. View "1995 CAM LLC v. West Side Advisors, LLC" on Justia Law

In 2019, the New York Legislature enacted the Housing Stability and Tenant Protection Act (HSTPA), expanding rent stabilization to all municipalities in the state. The City of Kingston declared a housing emergency on August 1, 2022, opting into the Emergency Tenant Protection Act (ETPA). Petitioners, a group of landlords, sought to invalidate Kingston's opt-in and two guidelines set by the Kingston New York Rent Guidelines Board (KRGB).The Supreme Court upheld Kingston's emergency declaration, finding the city's survey methodology reasonable. However, it vacated the KRGB guidelines, ruling that the fair market rent guideline required a case-by-case determination and that the rent adjustment guideline lacked statutory authority.The Appellate Division modified the Supreme Court's order, reinstating the KRGB guidelines. It held that the emergency declaration was based on a good faith study and that the fair market rent guideline did not require a case-by-case assessment. The rent adjustment guideline was also upheld, as the ETPA allows for rent adjustments without specifying that they must be upward.The New York Court of Appeals affirmed the Appellate Division's decision. It found that the City's 2022 survey was reasonably reliable and relevant, supporting the emergency declaration. The court also upheld the fair market rent guideline, noting that it did not have an impermissibly retroactive effect, as no refunds were issued for periods before August 1, 2020. The challenge to the rent adjustment guideline was deemed unpreserved and not properly before the court. View "Matter of Hudson Val. Prop. Owners Assn. Inc. v City of Kingston" on Justia Law

The petitioner, owner of an apartment building in Manhattan, filed an application with the Division of Housing and Community Renewal (DHCR) in 2019 to amend its 2016 and 2017 annual registration statements. The petitioner claimed that the registrations erroneously stated that unit 1B was temporarily exempt from rent stabilization due to owner/employee occupancy, while it should have been permanently exempt due to a high rent vacancy in 2002. The petitioner sought to withdraw the erroneous registrations and submit new ones removing unit 1B from the total of rent-stabilized units.The Rent Administrator denied the application, stating that registration amendments could only correct ministerial issues, not substantive changes like recalculating rental history or removing an apartment from rent-stabilized status. The Deputy Commissioner of DHCR upheld this decision, agreeing that the requested amendments went beyond the scope of an amendment application proceeding. The petitioner then commenced a CPLR article 78 proceeding to annul DHCR's determination.The Supreme Court denied the petition and dismissed the proceeding, reasoning that DHCR rationally determined the requested correction was substantive rather than ministerial. The Appellate Division unanimously affirmed, noting that DHCR's interpretation of the Rent Stabilization Code (RSC) as precluding the requested amendments was rational and reasonable.The Court of Appeals of New York reviewed the case and held that DHCR's interpretation of the RSC, which limits amendments to ministerial issues, was entitled to substantial deference. The court found that DHCR's decision to deny the petitioner's application was rational, as it aimed to protect tenants from fraud, preserve agency resources, and ensure rent stabilization disputes were litigated in the proper forum. The order of the Appellate Division was affirmed, with costs. View "Matter of LL 410 E. 78th St. LLC v Division of Hous. & Community Renewal" on Justia Law