Adam Leitman Bailey, P.C. Forces Sponsor to Fix Newly Constructed Building and Donate 10 Units to Settle Case
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OUTCOME:
In late 2006, purchasers were eager to buy units in a “luxury” new construction condominium being built in the heart of trendy Williamsburg. Purchasers closed on 19 of the 29 units (the condominium’s ...sponsor retained ownership of the last ten units). Shortly after closings began, unit owners began to realize that despite the fancy marketing, the building was rampant with construction defects.
Myriad calls and letters to the condominium’s sponsor, and its principal, resulted in no response to the board or unit owners. The board began sinking its operating funds into remediating the construction defects on its own. Unit owners grew weary and impatient, shelling out much more than anticipated in common charges and special assessments.
The board turned to Adam Leitman Bailey, P.C. for help.
We contacted local politicians, submitted a complaint on behalf of the board to the New York State Office of the Attorney General, and filed a Summons with Notice in State Supreme Court.
Finally, after months of negotiation and mediation before the Office of the Attorney General, the sponsor reluctantly signed a settlement agreement with the board. The settlement included transfer of the sponsor’s ten remaining units to the board and a cash settlement to offset the cost of remediation that the board had previously undertaken. And, as a further guarantee for the future cash payments, the settlement included a personal guaranty and confession of judgment for a balloon lump sum should sponsor fail to make timely payments pursuant to the agreement.
The building has now become the building that was promised in the offering plan and serves as a wonderful place for its residents to live.
Adam Leitman Bailey, John M. Desiderio, and Leni Morrison Cummins were on the legal team at Adam Leitman Bailey, P.C. representing the board.
Real estate
Adam Leitman Bailey P.C. Works with Attorney General’s Office to Enforce $11 Million Judgment
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OUTCOME:
The owners of 72 condominium units situated in four attached condominium buildings located in an up and coming section of Brooklyn came to us in late February, 2007, after having been represented by tw...o prior law firms. They had entered into a settlement agreement that eliminated any right to commence suit against the Sponsor of the four buildings. Investigation of this matter revealed that the buildings needed over 9 million dollars in remediation to the building exterior, interior and mechanicals. The Sponsor, represented by counsel, put up every road block imaginable to delay the remediation of the buildings. The scope and amount of the remediation and the process of the investigation was quite extensive. In order to apply maximum pressure against Sponsor, we involved the Office of the Attorney General, the Department of Buildings, and the Courts in our offense. After much effort by the Litigation Department of Adam Leitman Bailey P.C. led by Adam Leitman Bailey as overall supervising attorney, we negotiated an agreement with Sponsor that would ultimately lead to either a complete buyout of the units or a multimillion dollar judgment against Sponsor – a true win-win scenario for the unit owners. When Sponsor was unable to deliver under the terms of the buyout, the unit owners received an 11 million dollar judgment against the Sponsor, and circumvented a potentially lengthy litigation.
The second hurdle the condominiums faced was that the sponsor built the buildings too tall. The sponsor lied to the Department of Buildings in order to qualify for an exception that allows sponsors to build in excess of the air rights associated with a particular parcel of land. Once the buildings were erected and sold, the Department of Buildings became aware of this and ruled that the buildings would not be able to get a Permanent Certificate of Occupancy unless they literally removed the top stories of each building. Adam Leitman Bailey, P.Cc attended numerous meetings with the Department of Buildings and lobbied local politicians to encourage the Department of Buildings to reverse its decision. The Department of Buildings has now determined that if the condominiums make various repairs, it will award the buildings with Permanent Certificates of Occupancy. Having received settlement funds and a construction loan, the condominiums are only a few short steps away from obtaining their Certificates of Occupancy.
Adam Leitman Bailey, John Desiderio and Leni Morrison Cummins were the team at Adam Leitman Bailey, P.C. representing the boards of the four condominiums.
Real estate
Adam Leitman Bailey, P.C. Prevails in Non-Primary Residency Eviction Case
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OUTCOME:
Without concrete documentary evidence to rely on, Adam Leitman Bailey, P.C. faced an up-hill battle demonstrating that a shareholder failed to reside in his Mitchell-Lama Cooperative as his primary res...idence. With a relentless and methodical cross-examination, however, Adam Leitman Bailey, P.C. succeeded in exposing the shareholder’s numerous lies.
Initially, the management company referred the case to Adam Leitman Bailey, P.C. to recover the apartment after it suspected the shareholder was not actually residing in the apartment. Adam Leitman Bailey, P.C. began its prosecution of the case by providing the shareholder with an opportunity to submit documentation proving that he did, in fact, reside in the apartment as his primary residence. The shareholder submitted several letters with documentation to prove primary residence.
Adam Leitman Bailey, P.C. did not have extensive documentary evidence connecting the shareholder to an alternative residence. Although the shareholder jointly owned shares with his wife in another cooperative unit, the shareholder maintained that his wife resided there, and that they had been separated for over a decade but never legally divorced. The shareholder also had two vehicles registered at the alternative address, but explained that one vehicle was actually used by the shareholder’s son and the other was leased as a business car. A quick searching revealed that the shareholder did own a business registered to this alternate cooperative unit.
Unconvinced with shareholder’s submissions, Adam Leitman Bailey, P.C. commenced a case at the Department of Housing Preservation & Development (“HPD”). Because the apartment is subject to the Mitchell-Lama regulations, an evidentiary hearing on the question of primary residence must be held before an Administrative Hearing Officer.
In response, the shareholder retained counsel to represent him at the hearing. Without substantial documentary evidence, the success of the prosecution rested on the cross-examination. Adam Leitman Bailey, P.C. attorneys memorized every detail of the case to expose the shareholder’s contradictions and misrepresentations. Through extensive and methodical cross-examination, the shareholder’s lies were exposed one after another. First, the claim that the car being leased for “business purposes” contradicted a previous explanation from the shareholder that the car was actually used by the shareholder’s wife. When questioned, the shareholder had no credible explanation for this. Second, when pressed on cross-examination about the purported son’s use of the second vehicle, the shareholder could not give a credible explanation demonstrating that the son actually used the car and reimbursed his father (as the shareholder claimed).
Furthermore, Adam Leitman Bailey P.C. attorneys methodically broke down the shareholder’s claim that he was separated from his wife for over a decade and, therefore, did not reside in the alternate cooperative unit with her. It became obvious that the shareholder’s claims were not credible given his obfuscating answers on cross-examination. Adam Leitman Bailey, P.C. attorneys pressed on, destroying the shareholder’s credibility. By the end of the two day hearing there was no question the shareholder did not live in the Mitchell-Lama apartment as his primary residence.
This case is not only a victory for the Landlord and Adam Leitman Bailey, P.C., it is a victory for the people of New York. Mitchell-Lama Cooperatives are government subsidized and exist to provide low and middle income families with affordable housing. With this success, a family that actually intends to reside in the apartment can now have an affordable and well-maintained place to live.
Don Mitchell, Christopher Halligan and Leni Morrison Cummins from Adam Leitman Bailey, P.C. prevailed in the case
Real estate
Successful Eviction of a Mitchell Lama Occupant Despite Prior Issuance of Stock
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OUTCOME:
The Board of Directors of our client, a Mitchell Lama cooperative, faced a daunting problem: Based on a tip, they suspected that the current occupant of a unit in the cooperative was residing there i...llegally. However, all of the cooperative's documentation -- proprietary lease, application, and Household Income Affidavits -- indicated that the occupant was, in fact, the lawful successor to the apartment. And, to make matters even more difficult, the occupant of the unit in question was listed on the most recent stock certificate, a privilege reserved only for tenants. The Board turned to its general counsel Adam Leitman Bailey, P.C. for its assistance with this matter.
While many attorneys assume that stock certificates are dispositive of right to occupancy, we knew that the lease, not the stock, is dispositive of this right. Since the occupant's name was not on the proprietary lease, we knew that the burden fell on the occupant to prove her right to succeed to the tenancy.
We sent a letter to the occupant requesting documentary proof of her right to succeed to the apartment. Within one week we received a multitude of documents that at first review seemed to prove the occupant's right to the apartment by means of succession from the tenant of record. We knew we had to dig deeper.
Knowing that the purported successor must prove requisite family relationship and cohabitation with the tenant of record for the two years prior to the tenant's vacating the premises, we carefully studied the current tenant's Household Income Affidavits and examined the documents submitted by the occupant. While birth certificates proved the requisite family relationship, her proof of residency was weak. Bank accounts held in the tenant's name with the address of the premises had very low balances and the credit cards held in the tenant's name with the address of the premises had almost no activity. In addition, the occupant did not submit tax returns or W2s, both of which were specifically requested in our document request letter.
Once we determined that the occupant's succession claim was tenuous, we performed an investigative database search. We found that the tenant owned a unit in a condominium in Miami during the two years she claimed to be living in the cooperative unit with the occupant. In addition, we found out that the tenant's Miami condominium unit was homestead exempt, which meant that it was the tenant's primary residence for the two years in question. Since a person may maintain only one primary residence, the apartment in the Mitchell Lama cooperative could not have been maintained as her residence during the pertinent two-year time period.
We therefore knew that the tenant had staged documents with the intent of illegally transferring the apartment to the occupant. We immediately denied the succession rights of the occupant and sent the tenant a notice of intention to terminate the lease.
Several days after the service of our denial and notice, we were contacted by the occupant's attorney. We explained the breadth of our evidence and that pursuant to the Mitchell Lama Rules our attorneys' fees would be deducted from the tenant's equity investment in the apartment. Within hours, the occupant agreed to surrender the apartment.
By conducting an investigation instead of spending time litigating in Court we saved the cooperative thousands of dollars in legal fees and still recovered possession of the apartment.
Christopher Halligan and Leni P. Morrison represented the Board in this case on behalf of the cooperative corporation.
Real estate
Mitchell Lama Cooperative Board Successful In Cleaning Up Illegal Occupancy Mess
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OUTCOME:
Our client, a city-regulated Mitchell-Lama cooperative, was being charged by a city regulatory body (the Department of Housing Preservation and Development) with allowing over 60 illegal occupancies in... their 500-unit building. As a result, the Board of Directors for the cooperative faced stiff sanctions from the city regulators. Our client was frustrated because they were unable to prove that the occupancies in question were, in fact, illegal and were therefore unable to evict the tenants or occupants. They hired one law firm after another to help them with the evictions, but each firm failed to evict a single illegal occupant. Finally, the client turned to Adam Leitman Bailey, P.C., which quickly analyzed the problem and developed a solution. Within weeks, evictions were under way. Within months, half of the identified units were turned over to management for resale, with the evictions achieved by means of settlement. Most of the other unqualified tenants were required to appear before the Department of Housing Preservation and Development and/or Housing Court. In all cases where a final decision has been rendered, Adam Leitman Bailey, P.C. has achieved the Board's goals.
How we did we attain such positive results where no prior firm was able? We focused on fact finding and fraud detection.As soon as we were retained, we sent detailed document request letters to the tenants and occupants suspected of involvement in illegal occupancy or fraud. Our document request letters demanded that the tenant or occupant prove their right to the apartment by supplying a multitude of documentary evidence. In addition to our general fact finding, we also performed our own fraud detection. We searched investigative databases to determine whether the occupants'/tenants' proof was authentic. According to one attorney at the firm, "Knowledge of the data in investigative databases gives you the advantage of asking the right questions and requesting the right documents." We also hired private investigators to acquire evidence for hearings.
Once the fact finding and fraud detection had confirmed illegal occupancy, we immediately began the appropriate case: illegal sublet, non-primary residence, or breach of the lease by misrepresentation or fraud. Most of the illegal occupants claimed that they had succession rights, so success in our cases also depended on extinguishing their false claims. In addition, in bringing our cases, we had to be sure that we were following the Mitchell Lama Rules, a complex, detailed protocol. In the end, our thorough knowledge of the Mitchell Lama procedure was a key factor in our prompt success. .
Another problem facing our client's Board was how to handle those units identified as illegal occupancies by the city regulators where the Board believed that the tenants were, in fact, legitimate. In these situations, we worked hand-in-hand with the tenants and/or purported successors to produce documents necessary to prove their right to the apartment. Once sufficient documents were compiled, we prepared formal submissions to the Department of Housing Preservation and Development. All of the units in question were restored to good standing with the Department of Housing Preservation and Development, except for one instance where the Board was mistaken about the identity of a purported successor.
In addition to the illegal occupancy cases described above, Adam Leitman Bailey, P.C. also handled a number of nuisance and non-payment cases for which we aggressively commenced and pursued proceedings in the Department of Housing Preservation and Development and/or Housing Court.
Christopher Halligan and Leni Morrison represented the cooperative in these matters.
Real estate
Exhaustive Investigation and Negotiation Results in Cooperator Garnering Exclusive Penthouse Roof Terrace
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OUTCOME:
Our clients purchased one of the 250 luxury units in an upper west side landmarked cooperative. Prior to the purchase, a real estate broker hinted to our clients that although no proof existed, the Un...it may include an exclusive roof area bounded by a fence providing them with expansive city views and privacy from the main roof area. Upon moving in five years ago, the Board immediately denied our clients’ request to erect a fence and recognize the bounded area as exclusive to our clients. The Board claimed that the Unit did not include an exclusive roof area and relied on a provision of the Proprietary Lease, which clearly gave the right to outside space only to those units that had outside space at the time the cooperative was created. The Board claimed that our clients’ penthouse did not have an exclusive roof area at the time the cooperative was created. To make our clients’ situation worse, within the last two years the roof has been made open to use by the hundreds of residents of the building. The noise and lack of privacy renders the master bedroom and bathroom unusable. For years our clients have plead with and attempted to convince the Board of their right to an exclusive roof area. Our clients’ made one last appeal to the Board in late 2008.
When they were denied once again, they turned to Adam Leitman Bailey, P.C. for help. [...]
After years of fighting with the Board, within a few short months after retaining Adam Leitman Bailey, P.C., our clients gained exclusive roof space and privacy in their master bedroom and bathroom.
