Proven Results: On and Off the Court
“Inspections” as referenced in a REBNY standard form Condo Contract of Sale does NOT include testing for Asbestos.
SKH HEIBERGER LLP’s recent Supreme Court success highlights the added value that the Firm brings to our Client's. From the outset, we conduct the Due Diligence, handle the Purchase(s), draft lease(s), commence and defend Court actions, and effectuate the Sale(s). So whether our customer is the Owner, Management firm, Seller, Purchaser, Landlord, Tenant, developer, Coop /Condo Board, or an Investor, our Teams’ deep understanding of both the legal and practical nuances of New York Real Estate combined with decades of experience allows us to handle the wide array of ancillary issues that can arise during the course of Litigation or a Transaction.
The Firm’s Closing Team, led by Partner Jamie Heiberger Harrison, had represented a NYC Condo Owner in the negotiation and execution of an “All Cash, Non-Contingent sale,” drafted on the current REBNY form which contained standard terms including the Buyers’ right to access the premises between Contract and Closing for Purposes of “inspecting and measurements." Thereafter, Purchaser scheduled an inspection, but appeared with a Contractor seeking to do an ACP5 test (a/k/a as an asbestos test), which is required when applying for a demolition permit through the Department of buildings. While such tests are mandated in order to commence construction, they are {generally} performed on behalf of an Owner, as opposed to a Buyer, due to the invasive nature of the test as well as the legal requirements if there is a positive finding. As such, the Seller would not all allow the test unless the Buyer, through her Attorney, agreed to proceed to close irrespective of the test results. Buyer refused and instead sought to void the Contract and demanded the return of the Contract deposit. As the Contract that the firm negotiated and drafted was clear on its face that access was for “inspecting and measurements,” we were able to quickly provide assurances to our client that they had the right to deny testing. Thereafter, litigation ensued at which point the file was transferred from our Transactional Division to the Firm’s Litigation Division led by Partner, Steven Sperber with the written presentation of Partner Jacqueline Handel- Harbour.
On January 15, 2021, by the Hon. Arlene P. Bluth of the Supreme Court – New York County, in the case of Fisher v. Mor, Index No.: 654802/2020, the Court unequivocally held that a party cannot demand upon provisions to a Contract of Sale that are otherwise not there. The Buyer, after executing the Contract of Sale tried to do just that. When denied by the Seller, Purchaser refused to close, and sued for the return of the Contract Deposit. The Seller confident in their position, moved for summary judgment at the infant stages of litigation. Attempting to persuade the Court of the Buyer’s position that she was justified in refusing to close on the sale without the asbestos inspection, Buyer’s attorney cherry picked provisions from the Contract of Sale, that referenced conducting inspections and/or otherwise offering a tortured interpretation of each provision, that made no mention of asbestos testing. The Seller through representation by the Firms' Litigation Department was granted summary judgment with the Buyer forfeiting any right to the return of the down payment. Specifically, the Court found that there was “no reasonable interpretation” of the paragraphs in the Contract that pointed to, that would “permit the intrusive testing Plaintiff demanded.”
Parties should be very clear in the terms stated within a negotiated Contract of Sale. “A generalized provision about an inspection and taking measurements is demonstrably different than allowing a Plaintiff to potentially damage the property by doing intrusive testing and chiseling around to look for asbestos prior to closing,” held the Court Fisher v. Mor.
As a result of the Buyers’ improper demand and refusal to close without such inspection, she forfeited her down payment and is now subjected to reimbursing the Seller for their legal fees based upon the contractual obligations of the parties, as successfully negotiated by our firm.
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On and off the “Court” - this Firm shines!
Steven, Jamie, Eric and the entire SKH Heiberger LLP team
