Landlord Represented by Insurer Can Get Attorney's Fees

Tenant-shareholder, who held proprietary leases to 19 apartments in a cooperative building, sued landlord co-op corporation, several board members, and the co-op's managing agent. The court dismissed the case, and landlord asked for attorney's fees totaling over $175,000. Landlord had been represented by its insurance carrier in the case, and the total fees actually paid to a law firm by landlord's insurer were $95,000. Tenant claimed that landlord shouldn't get attorney's fees because this expense was covered by insurance. The court ruled for landlord. Landlord was entitled to attorney's fees under the fee-shifting provision in tenant's proprietary lease, even though it was represented by its insurer under a liability policy. But the amount of fees was limited to the amount billed to the insurer by the law firm it used to defend the case, including any deductible paid by landlord.

515 Avenue I Corp. v. 515 Avenue I Tenants Corp.: Index No. 65/2005, NYLJ No. 1202475831581 (Sup. Ct. Kings; 12/1/10; Battaglia, J)