Tenants Can't Challenge Landlord's Condo Conversion Plan

Rent-stabilized tenants of Manhattan House apartment building sued the New York State Attorney General (AG) to challenge the AG's decision to accept landlord's condominium conversion plan. They claimed that there were conflicts of interest because the landlord-sponsor's attorney would act as escrow agent for apartment buyers' deposits, and because the sponsor's managing agent would also serve as sales broker. They also claimed that landlord made premature disclosures of financial details of the plan, that landlord harassed tenants, and that there were leaks, flooding, heat and hot water problems, and asbestos and fire code violations. The court ruled against tenants. Tenants didn't have standing to challenge the AG's decision to accept the plan because they weren't "aggrieved" parties. The plan was a noneviction plan, and tenants who didn't purchase would be entitled to renew their leases indefinitely. Sponsors' attorneys typically served as escrow agents for purchase deposits, and a single real estate firm usually certifies the common charges, while acting as broker. There were no conflicts of interest shown. The AG investigated tenants' claims of harassment and building violations and his decision, and found no basis to reject the plan.

Urquia v. Cuomo: NYLJ, 1/11/08, p. 26, col. 1 (Sup. Ct. NY; Stone, J)