Over the past few months there have been several interesting and insightful court decisions. Here are a few legal cases that provide some helpful lessons.
Vassi v. Salem House Condo Bd.
Lesson: Condo boards need to make sure they have authority to enter into rooftop antenna contracts without unit owner approval before doing so.
The board of managers of a condominium located in New York County, entered into a contract for T-Mobile to place a cellular antenna on the roof of the condominium building. The board entered the agreement and T-Mobile proceeded with $270,000 in construction work on the common element roof. The board did not seek prior unit owner approval and the plaintiff unit owners sued to stop the completion of the work. The Supreme Court granted a restraining order temporarily stopping the work, but after a full briefing and argument, decided that there were no grounds to stop the work.
There were several interesting points made by the court in the decision, but the most significant was that the board did not have to go to the unit owners first for approval. If the plaintiffs had prevailed, however, the board would have been exposed to a breach of contract claim by T-Mobile which could have resulted in a recovery of at least $270,000 in damages. Before entering into these types of contracts, boards need to make absolutely sure that they have authority to lease out common element roof without first seeking unit owner approval. Otherwise the condo can be exposed to suit such as this one and possible significant damage exposure.
The Salem House Condo’s Declaration states that “No person shall use or enjoy the general common elements except in accordance with the reasonable purposes for which they are intended and without encroaching on the rights of other persons to do so.” The declaration also provides that the roof is a common element. The court held that the declaration language did not “state with enough specificity what type of uses interfere with use and enjoyment. Is it a slight use which does not substantially interfere with plaintiffs’ use and enjoyment or does it bar complete or near complete activities on the roof? Such restrictions on the use of land must be supported by clear and convincing evidence.” Further, the Salem House condo’s bylaws provide that the “board or managing agent may curtail or relocate any portion of the common elements devoted to storage, recreation or service purposes in the building.” The court held that by their terms, the bylaws supersede the declaration provision. If the declaration and bylaws provided otherwise or if the facts presented by plaintiffs were different, the court may have decided the case differently.