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Adam Leitman Bailey, P.C. Appellate Victory: Successor Sponsors No Longer Responsible for Repairing Building

In a decision of first impression, the Brooklyn Supreme Court held that a successor condominium sponsor is not liable for building defects caused by the original sponsor’s construction of the condominium. Justice Lawrence Knipel threw out a condominium board’s claim seeking to impose construction defect liability on a developer who purchased the interest of the condominium’s bankrupt original sponsor under a Chapter 11 Plan.

The Bayard Views Condominium, a 62-unit luxury building overlooking McCarren Park in Brooklyn, was completed just before the 2008 recession, which forced the original sponsor into Chapter 11 bankruptcy after it could sell only 25 apartments. In 2011, a subsidiary of the property group of the successor sponsor, a Brooklyn developer who was uninvolved with the building’s construction, was able to purchase the remaining 37 apartments under the sponsor’s Chapter 11 Plan.

  • Adam Leitman Bailey, P.C. Appellate Victory: Successor Sponsors No Longer Responsible for Repairing Building

    Adam Leitman Bailey, P.C. Appellate Victory: Successor Sponsors No Longer Responsible for Repairing Building

    Adam Leitman Bailey, P.C. successfully defended purchasers of units in a condominium following the original sponsor’s  bankruptcy against claims of individual units’ owners for breach of contract The original sponsor of a condominium conversion declared bankruptcy after it was sued by individual unit owners for design and construction defects. In the bankruptcy proceeding, the firm’s client purchased almost 40 unsold units and unsold parking spaces  “free and clear” of the defective pre-bankruptcy design and construction defects of the original sponsor....

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  • Photo of 20 Bayard Street
    Court Lets Sponsor Off the Hook for Condo Defects

    Court Lets Sponsor Off the Hook for Condo Defects

    Habitat Magazine

    April 27, 2017 — Sponsor not responsible for $2 million in construction flaws. Condo boards and unit-owners have several options when they move into a new building with shoddy construction. To avoid litigation, they can hire an engineer to document construction defects, then negotiate with the sponsor to correct them. If the unit-owners are unhappy with the repairs, both sides can agree to name a so-called “designated neutral” to arbitrate their disputes. If all else fails, there’s always the last...

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  • Photo of The Real Deal logo next to buildings
    Fortis not responsible for $2M in defects caused by prior developer, Judge says in ruling against 20 Bayard Street residents

    Fortis not responsible for $2M in defects caused by prior developer, Judge says in ruling against 20 Bayard Street residents

    The Real Deal

    By Will Parker April 26, 2017 The company bought the condo building’s unsold units in 2011 after Isaac Hager took the project into bankruptcy. UPDATED, April 26, 4:00 p.m.: A court decision in Brooklyn last week will let Fortis Property Group  get away with selling allegedly faulty condominiums in Williamsburg, for the simple reason that Fortis wasn’t the one that built them in the first place. When developer Isaac Hager’s company went into bankruptcy at the 62-unit Bayard Views Condominium at 20 Bayard Street on...

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  • Photo of a New York City condominium building
    Adam Leitman Bailey, P.C. Makes New Law, Defeating Successor Sponsor Construction Defect Claim Against Developer Who Bought Units From Bankrupt Sponsor

    Adam Leitman Bailey, P.C. Makes New Law, Defeating Successor Sponsor Construction Defect Claim Against Developer Who Bought Units From Bankrupt Sponsor

    In a decision of first impression, the Brooklyn Supreme Court held that a successor condominium sponsor is not liable for building defects caused by the original sponsor’s construction of the condominium. Justice Lawrence Knipel threw out a condominium board’s claim seeking to impose construction defect liability on a developer who purchased the interest of the condominium’s bankrupt original sponsor under a Chapter 11 Plan. The Bayard Views Condominium, a 62-unit luxury building overlooking McCarren Park in Brooklyn, was completed just...

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  • Bayard Condos Brooklyn Preview Image
    BOARD OF MANAGERS OF THE BAYARD VIEWS CONDOMINIUM v. FPG BAYARD, LLC, Fortis Property Group, LLC

    BOARD OF MANAGERS OF THE BAYARD VIEWS CONDOMINIUM v. FPG BAYARD, LLC, Fortis Property Group, LLC

    2017 WL 1435430 (N.Y.Sup.) (Trial Order)Supreme Court of New York.IAS Term, Commercial Part 4Kings CountyBOARD OF MANAGERS OF THE BAYARD VIEWS CONDOMINIUM, on behalf of individual unit owners, Plaintiff,v.FPG BAYARD, LLC, Fortis Property Group, LLC, Joel Kestenbaum, and Jonathan Landau, Defendants.No. 502885/14.April 21, 2017.Decision and OrderLawrence Knipel, J.S.C.*1 Mot. Seq. #1 The following e-filed papers read herein: NYSCEF#: Notice of Motion, Affirmation, Memorandum of Law, and Exhibits Annexed 23, 24, 25-43 Affidavit in Opposition, Memorandum of Law, and Exhibits Annexed...

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  • Photo of 20 Bayard Street
    Bd. of Managers of the Bayard Views Condominium v. FPG Bayard, LLC

    Bd. of Managers of the Bayard Views Condominium v. FPG Bayard, LLC

    Thomson Reuters

    2017 WL 1435430 (N.Y.Sup.) (Trial Order) Supreme Court of New York. IAS Term, Commercial Part 4 Kings County BOARD OF MANAGERS OF THE BAYARD VIEWS CONDOMINIUM, on behalf of individual unit owners, Plaintiff, v. FPG BAYARD, LLC, Fortis Property Group, LLC, Joel Kestenbaum, and Jonathan Landau, Defendants. No. 502885/14. April 21, 2017. Decision and Order Lawrence Knipel, J.S.C. *1 Mot. Seq. #1 The following e-filed papers read herein: Notice of Motion, Affirmation, Memorandum of Law, and Exhibits Annexed NYSCEF#: 23,...

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  • Photo of New York City condo buildings
    Ruling has big implications for condo developer liability, makes it harder for condo boards to sue individual developers for construction defects

    Ruling has big implications for condo developer liability, makes it harder for condo boards to sue individual developers for construction defects

    The Real Deal

    Attention, Brooklyn condo buyers: Good luck trying to hold your developer personally accountable By Will Parker The LLC veil used by condo developers in Brooklyn just became Kevlar. A new appellate court ruling will make it harder for condominium boards in the borough to sue individual developers of apartment buildings for construction defects. Over the years, a number of Brooklyn condo buyers filed lawsuits in New York Supreme Court against the actual developers behind the projects they lived in, alleging...

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