Cooperator News: The Year in Co-op, Condo, & HOA Law
Herrick partners Deborah Koplovitz and Andrew B. Freedland's New York Law Journal article discussing a recent ruling in a case involving Brooklyn co-op Trump Village Section No. 4 and a shareholder it claims made misrepresentations on his purchase application that caused the co-op to waive its right of first refusal and thus incur monetary damages was featured in a courts and legislation round-up by Cooperator News New York for Summer 2022.
Cooperator News notes that, "Koplovitz and Freedland point out that the substance and procedure of the claims that the co-op proffered might have played a role in the April 20, 2022 judgment for the defendant in the matter of Trump Village Section No. 4 v. Gene Vilensky a/k/a Gene Vilenskiy by Justice Ingrid Joseph of the Supreme Court, Kings County. The case alleges that the defendant listed himself as the only occupant of the apartment he was applying to purchase in 2014, agreeing that any false information or omission of material information in the application could result in its rejection, revocation of its approval or termination of the proprietary lease after closing. After approving the application, thereby waiving its right of first refusal, the co-op discovered that the defendant (having since closed title on the shares) was renting his unit out on Airbnb, both in violation of the proprietary lease and in refutation of his application representations."
"Rather than seeking to terminate the proprietary lease and recover possession of the defendant’s apartment in a landlord-tenant proceeding, the co-op sought monetary damages and rescission of its waiver to right of first refusal." The article continues, "Even though lower courts denied the defendant’s motion to dismiss, citing the misrepresentations the defendant made in his purchase application that caused the co-op to waive its right of first refusal, Justice Joseph found for the defendant, concluding that the co-op didn’t show sufficient proof of damages relative to its waiver of its right of first refusal, and that the rescission claim was not legally viable."
Read the full round-up in Cooperator News here.
This is discussed in the full analysis that originally appeared in the May 13, 2022 publication of the New York Law Journal. Access may require a subscription.