Board Of Managers Was Not Authorized To Reallocate Expenses Of Parking Repair Project, Court Rules
At a multi-level condominium, plaintiff was the owner of five commercial units and sixteen parking spaces dedicated for commercial use, corresponding to 8% ownership of the common elements. The condominium undertook a $400,000 construction project to repair a parking deck, and assessed plaintiff’s units for 60% of the cost. Plaintiff sued to enjoin the “grossly disproportionate” assessment, and the Board of Managers counterclaimed to foreclose a common-charges lien.
In Board of Managers of Bayside Condominium v. Mittman, 2014 N.Y. Slip Op. 50547 (Sup. Ct. Queens Co. Apr. 7, 2014), the court denied the Board of Managers’ motion for summary judgment. The court observed that under standard language contained in the Condominium Declaration, each unit owner must contribute to common expenses in accordance with its percentage interest in the common elements. The Board relied on another provision of the Declaration authorizing the Board to allocate expenses “based on special or exclusive use, or availability or exclusive control, of facilities or services provided by the Condominium.” The Board contended that allocating 60% of the project cost to plaintiff was fair and consistent with the Declaration because the work would benefit plaintiff’s units to a greater extent than others. The court held that because the work would also substantially benefit other unit owners, the “special or exclusive use” provision did not apply and the Board was required to allocate the costs based on common interest ownership. Moreover, because the Board had gone outside its authority in assessing plaintiff for a greater share of the expenses than the Declaration permitted, the Business Judgment Rule did not apply.