Lamentable Leaks Big Damages Serve as a Warning to Boards

A Brooklyn condominium board learned a painful lesson recently when a jury awarded $55,000 in punitive damages to a unit owner who lived with a leaking roof for 11 years.

The verdict in the case

Board of Managers of Sterling Condominium v. Samuel N. Wordie is a significant victory for apartment owners and should serve as a warning to co-op and condo boards to attend to complaints from residents. The jury awarded punitive damages because it saw the board's refusal to repair the roof and stop the leaks into the unit owner's apartment as wanton and reckless. In light of that decision, boards that refuse to attend to shareholder/ owner complaints will be held accountable in court.

The case was tried in New York City Civil Court in Brooklyn in July and August of 2003. I represented the unit owner at trial and from July 2000 to date. The case involved a longstanding dispute between my client and the board of managers. The jury awarded my client $15,800 in compensatory damages for property damage in addition to the $55,000 in punitive damages.

Worse yet for the board, punitive damages are not covered by directors and officers (D&O) insurance in New York State. After the trial judge denied the board's motion to set aside or reduce the amount of the punitive damage award, the board - with the approval of unit owners - imposed a special assessment on all unit owners to pay the verdict, and the verdict was paid by the board in April 2004 - with interest. Thus, all unit owners had to pay for the board's failure to address the leaks.

The Litigation

The dispute began in 1992 when my client purchased a duplex unit with a rooftop terrace in a new 36-unit condominium building in Brooklyn. Roof leaks occurred regularly from 1992 through 1997. After consultants confirmed that the roof was poorly constructed, the board called a special assessment on unit owners in 1997 and the roof was completely reconstructed. However, leaks continued into my client's unit.

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3 Comments

  • It is interesting to note that the B/M/Directors have a responsibiity to all owners. I have a particular problem regarding a "noise" complaint which cannot be substantiated and "reasonable modifications" made to the apt. by a handicap individual above. The Board insists on installation of carepting over hardwood flooring and the handicap individual is in danager of falling on the carpeting surface. Any advice?
  • Jon, great article. Are you my colleague from the Rome Sentinel? This is your old friend Dave.
  • My problem is with the proprietory lease which isn't specific about my apartment space. I own a duplex and the driveway. The yard is attached to my apartment and isn't written in any documents although I am the only one with access. Maintained and lived here for 30years.