Justia Real Estate & Property Law Opinion Summaries

The case pertains to a dispute between the Department of Finance of the City of New York and Brookdale Physicians' Dialysis Associates, Inc. over the revocation of a real property tax exemption. The property in question was owned by Samuel and Bertha Schulman Institute for Nursing and Rehabilitation Fund, Inc., a not-for-profit entity, and was leased to Brookdale Dialysis, a for-profit corporation. The Department of Finance retroactively revoked the property's tax-exempt status in 2013, citing the fact that the property had been leased to a for-profit entity.The Supreme Court initially annulled the Department's determination, arguing that it failed to consider whether Brookdale Dialysis' services were reasonably incidental to the exemption purpose. The Department of Finance reassessed the property for the 2014-2015 tax year and again revoked the exemption after finding that the income from the lease exceeded the expenses for the property. The decision to revoke the exemption was subsequently affirmed by the Appellate Division.However, the Court of Appeals reversed these decisions, holding that the property was not exempt under New York Real Property Tax Law § 420-a. The court noted that the law mandatorily exempts from taxation any real property owned by certain not-for-profit entities and used exclusively for beneficial purposes without financial gain. The law does not apply to property leased by a for-profit corporation. Therefore, the court concluded that the property in this case was not exempt under this law, and the Department of Finance's decision to revoke the exemption was justified. View "Matter of Brookdale Physicians' Dialysis Assoc., Inc. v Department of Fin. of the City of N.Y." on Justia Law

In this case, the appellant, Tax Equity Now NY LLC (TENNY), challenged the property-tax system of New York City, arguing that it imposes substantially unequal tax bills on similarly valued properties that bear little relationship to the properties' fair market value. TENNY further alleged that multi-million-dollar properties are taxed at similar or lower rates than less valuable properties and that real property in majority-people-of-color districts are overassessed and subjected to higher taxes compared to properties in majority-white districts. The plaintiff sought relief against City and State defendants for alleged constitutional and statutory violations caused by the City's tax scheme.The Court of Appeals of New York concluded that although TENNY's complaint failed to state claims against the State defendants, the complaint sufficiently alleges causes of action against the City defendants under section 305 (2) of Real Property Tax Law (RPTL) and the federal Fair Housing Act (FHA) on the basis that the system is unfair, inequitable and has a discriminatory disparate impact on certain protected classes of New York City property owners. The court therefore modified the Appellate Division's order with respect to these causes of action. The court also affirmed the dismissal of the remaining causes of action against the City and all claims against the State for failure to state a claim. View "Tax Equity Now NY LLC v City of New York" on Justia Law

This case revolves around the tragic drowning of a 14-year-old boy at a dam on Buffalo Creek in Erie County. The victim's mother brought a negligence and wrongful death lawsuit against the Joint Board of Directors of Erie-Wyoming County Soil Conservation District (the Joint Board), alleging that they owned the dam and were responsible for its maintenance and safety. The dam was initially constructed as part of a federal project under the Flood Control Act of 1944, after which the Joint Board was created as the local "sponsor" of the project. Two agreements between the Joint Board and the National Resources Conservation Service (NRCS) in 1959 and 1984 stipulated that the Joint Board had ongoing duties to inspect and maintain the dams. The case proceeded to a jury trial on the singular question of whether the Joint Board owned the dams at the time of the accident. Both the plaintiff and the Joint Board moved for directed verdicts. The trial court granted the plaintiff's motion, concluding that the Joint Board owned the dams. However, the Appellate Division reversed this decision and granted the Joint Board's motion for a directed verdict, ruling that the dams were fixtures that ran with the land and could not have been owned by the Joint Board since the NRCS did not own the underlying land. The Court of Appeals disagreed with both lower courts, stating that neither the plaintiff nor the Joint Board should have been granted a directed verdict as the evidence was not conclusive enough to establish ownership of the dams as a matter of law. The Court of Appeals ordered that the case be remitted to the Supreme Court for further proceedings, and affirmed the dismissal of claims against other parties, including the Districts, County, and Town. View "Suzanne P. v Joint Bd. of Directors of Erie-Wyoming County Soil Conservation Dist." on Justia Law

The Court of Appeals reversed the decision of the appellate division affirming the judgment of Supreme Court granting Respondents' motions to dismiss Petitioners' amended N.Y. C.P.L.R. 78 petition as time-barred, holding that the relation back doctrine applied.In 2012, Petitioners secured an injunction barring Respondents from using part of their property for nonresidential purposes. Thereafter, Respondents sought a variance from the Village of Hancock Board of Appeals (ZBA), which was granted. Petitioners later commenced a CPLR article 78 proceeding seeking annulment of the use variation. The appellate division granted the request and reversed. In 2016, Respondents sought a variance, which the ZBA granted. Petitioners subsequently commenced this CPLR article 78 proceeding seeking annulment of the ZBA's decision. This time, however, Petitioners omitted Respondent Rosa Kuehn. Supreme Court granted Respondents' motion to dismiss, concluding that the petition was time-barred against Rosa and that the claims against the remaining respondents must be dismissed for lack of a necessary party. The appellate division affirmed. The Court of Appeals reversed, holding that the relation back doctrine is not limited to cases where the amending party's omission results from doubts regarding the omitted party's identity or status. View "Nemeth v. K-Tooling" on Justia Law

The Court of Appeals affirmed the judgment of the appellate division affirming the judgment of Supreme Court denying the County of St. Lawrence's action seeking a declaratory judgment that Local Law No. 2-2021 of the City of Ogdensburg was inconsistent with N.Y. Real. Prop. Tax Law (RPTL) 1150 or otherwise unconstitutional under the home rule article of the New York State Constitution, holding that there was no error.The law at issue in this case repealed a prior local law validly opting out of the application of RPTL article 11. The County commenced this proceeding arguing that the law was not in accord with state law and impaired the rights of the County and the County Treasurer. Supreme Court denied the petition and declared the law to be valid and enforceable. The appellate division affirmed. The Court of Appeals affirmed, holding that the law did not violate the statutory and constitutional protections at issue in this case but effectuated a power granted by the legislature to cities wishing to revoke their opt-out from article 11. View "St. Lawrence County v. City of Ogdensburg" on Justia Law

The Court of Appeals reversed the order of the Appellate Division affirming the decision of Supreme Court granting summary judgment against Plaintiff and dismissing its complaint alleging that Saratoga County erroneously failed to serve upon it a tax foreclosure petition, holding that Plaintiff was permitted to raise a question of fact regarding whether the taxing authority complied with the statutory notice requirements contained in N.Y. Real Prop. Law (RPTL) 1125(1)(b).The County allegedly mailed, via certified and first class mail, a notice of foreclosure and notice of commencement of the tax foreclosure proceeding to Plaintiff's address. Later, a default judgment entered in favor of the County. The County sold the property at auction. Plaintiff brought this action seeking vacatur of the default judgment and the deeds conveying the property, alleging that the County failed to serve upon it the tax foreclosure petition, in violation of RPTL 1125. Supreme Court granted summary judgment for the County, and the Appellate Division affirmed. The Court of Appeals reversed, holding that an interested party is permitted to establish that a taxing authority failed to comply with the notice requirements set forth in RPTL 1125(1)(b) even when proof is submitted that notice that was allegedly sent by both certified and first class mail is not returned. View "James B. Nutter & Co. v. County of Saratoga" on Justia Law

The Court of Appeals held that the inclusion of concise and relevant additional information does not void an otherwise proper notice to borrowers sent pursuant to N.Y. Real. Prop. Acts. Law (RPAPL) 1304 and thus does not bar a subsequently filed foreclosure action.Borrower obtained a loan secured by a mortgage on his home and later defaulted on the loan. Bank sent Borrower notice of default pursuant to RPAPL 1304 and then brought this foreclosure action. Borrower filed a motion to dismiss, arguing that the inclusion of two paragraphs in his notice not found in RPAPL 1304 violated the statute. Supreme Court agreed and granted the motion to dismiss. The appellate division affirmed, determining that including in the envelop sent to the borrower any language not required by the statute violates the statute's separate envelope provision. The Court of Appeals reversed, holding (1) section 1304 does not prohibit the inclusion of additional information that may help borrowers avoid foreclosure and is not false or misleading; and (2) the additional information in this case was not false or misleading and should not render the notice void. View "Bank of America, N.A. v. Kessler" on Justia Law

The Court of Appeals held that, for purposes of New York's Uniform Commercial Code (UCC) 9-406, an "assignee" includes the holder of a presently exercisable security interest in an assignor's receivables.New Style Contractors, Inc. engaged Checkmate Communications LLC as a subcontractor. Pursuant to a promissory note and security agreement, Checkmate could borrow up to $3 million from Worthy Lending LLC. Checkmate granted Worthy a security interest in its assets, and Worthy filed a UCC-1 financing statement against Checkmate perfecting its secured position regarding Checkmate's assets. Worthy then sent New Style a notice of its security interest and collateral assignment in the New Style accounts. When Checkmate defaulted on the note and filed for bankruptcy. Worthy brought this action against New Style pursuant to UCC 9-607, alleging that Worthy was entitled to recover all amounts New Style owed to Checkmate after New Style's receipt of the notice of assignment. Supreme Court dismissed the complaint. The Appellate Division affirmed, concluding that Worthy did not have an independent cause of action against New Style pursuant to UCC 9-607 because the statute does not authorized a secured creditor as distinct from an assigned, to recover from a nonparty debtor like New Style. The Court of Appeals reversed, holding that the language of the statute required reversal. View "Worthy Lending LLC v. New Style Contractors, Inc." on Justia Law

The Court of Appeals held that a grievance complaint filed with the assessor or board of assessment review at the administrative level by a net lessee who is contractually obligated to pay real estate taxes on the property at issue satisfies N.Y. Real Prop. Law (RPTL) 524(3) such that the net lessee may properly commence an article 7 proceeding upon rejection of its grievance.DCH Auto leased a parcel of property in the Town of Mamaroneck upon which it operated a car dealership. DCH's lease with the owner was a net lease requiring DCH to pay the real estate taxes associated with the property, in addition to the rent. DCH challenged certain tax assessments by filing grievance complaints with the town's board of review. The board denied the challenges, after which DCH petitioned for judicial review. Supreme Court dismissed the petitions on the ground that only an owner may file the initial grievance complaints under RPTL 524(3). The Court of Appeals reversed, holding that DCH was included within the meaning of "the person whose property is assessed" under RPTL 524(3). View "DCH Auto v. Town of Mamaroneck" on Justia Law

The Court of Appeals affirmed the judgment of the Appellate Division affirming Supreme Court's judgment dismissing HSBC Bank USA, National Association's claim against the sponsor of an underlying transaction seeking to "revive" an earlier action filed by two certificateholders pursuant to N.Y. C.P.L.R. 205(a), holding that there was no error.Defendant, as sponsor of a residential mortgage-backed securities trust transaction, purchased thousands of mortgage loans and sold them to ACE Securities Corp. pursuant to an agreement in which the sponsor made various representations and warranties. ACE Securities deposited the loans in the trust, and the loans served as collateral for $500 million in certificates issued by the trust. Those certificates paid principal and interest to certificateholders based on funds generated by the mortgages. After two certificateholders brought an action against the sponsor HSBC filed a complaint on behalf of the trust purporting to substitute as plaintiff for the certificateholders. Supreme Court denied sponsor's motion to dismiss the complaint as untimely. The Appellate Division reversed, concluding that the action was time-barred. The Court of Appeals affirmed, holding that HSBC could not invoke C.P.L.R. 205(a) to avoid dismissal of this time-barred claim. View "ACE Securities Corp. v. DB Structured Products, Inc." on Justia Law