Shareholder Tenant Claims Co-op Board Improperly Denied Him a Second Parking Space

The co-op shareholder tenant of two apartments in a building sued landlord cooperative corporation and its board of directors, claiming breach of contract and breach of fiduciary duties. Tenant claimed that the co-op wrongfully refused to let him participate on an equal basis with other shareholder tenants in obtaining parking privileges in the building's garage. Tenant sought money damages and an order compelling the co-op to rent him the next available parking space. Landlord asked the court to dismiss the case without trial, and argued that it properly exercised the business judgment rule and followed House Rules that were consistent with the co-op's bylaws.

The court ruled against landlord. In 2007, tenant had purchased shares to his first apartment and received a parking space. When tenant bought a second apartment in 2015, the co-op refused to give him a second parking space. House Rules at that time provided that garage spaces were provided to shareholder tenants on an alternating lottery/seniority basis and only assigned to shareholders that lived at the building as their primary residence. On that basis landlord refused to give tenant a second parking space. Tenant argued that parking rules only required that the building be tenant's primary residence and there was no requirement that his second apartment be his primary residence. And landlord didn't show that, when tenant requested the second parking space in 2017 the House Rules restricted the allocation of parking spaces to shareholders that used any specific apartment as their primary residence, or that a resident could have only one space. The fact that the House Rules may have been validly amended after tenant made his request didn't provide a valid basis for denying tenant's request.

Turekian v. 9201 Shore Tenants Corp.: Index No. 520132/2018, 2023 NY Slip Op 30089(U)(Sup. Ct. Kings; 1/11/23; Saitta, J)