Structural Vs. Non-Structural Repairs Who Pays the Repair Bill?

 A leaking pool, a wall in need of repair, a faulty exhaust system, chimney and  furnace repairs… Who’s responsible for fixing them? Generally, most leases provide that “structural” repairs are the landlord’s responsibility and that “nonstructural” repairs are the tenant’s. However, what constitutes “structural” versus “non-structural” repairs or alterations are frequently disputed issues with potentially  far-reaching financial ramifications for cooperative corporations and  commercial tenants.  

 A recent decision of note, Excel Associates v. Excelsior 57th Corp., 2011 N.Y.  Slip Op. 32117[U], 2011 WL 3471228 (Sup. Ct. N.Y. County, Aug. 11, 2011),  decided by the New York Supreme Court in August 2011 (Hon. Judith J. Gische),  illustrates how complex these issues can be. While the court’s holding that the repairs at issue were “non-structural” is consistent with legal precedent, the court also noted that the definition of  a structural repair is a “flexible” one, which is determined on a “case-by-case basis.”  

 The repairs in question were of a leaking pool in the health club on the fifth  floor of the Excelsior, a co-op building at 303 East 57th Street. Both Excel, the master commercial lessee of five floors of commercial space at  the building, and Excelsior 57th Corporation, the cooperative  corporation/landlord, had sought declarations stating that the other party was  financially responsible for the repairs to the pool. Pursuant to a provision in  its long-term commercial lease with Excelsior, Excel was obligated, at its sole  cost, to make all “non-structural repairs” to the premises and to make all “structural repairs” which were caused by its own negligence or the negligence of its subtenants and  their respective employees or agents.  

 All into the Pool

 In June 1984, Excel sublet the health club to Megafit Corporation, which assumed  certain responsibility for the pool. In 1986, Megafit installed a new pool within the existing pool and subsequently  made some patchwork repairs after the pool developed severe leaks, flooding the  floor below. When the repairs performed by Megafit proved insufficient, the pool was drained  to determine the cause of the leaks. In 2010, Excel performed repairs to the pool, which involved the replacement of  components of the pool’s gutter system, including the filtration and drainage systems, and the  installation of a new waterproof membrane at a cost of approximately $50,000.  

Read More...

Related Articles

Liability Issues Your Board Should Know

It Pays to Be Aware

So You Want to be a Board Member?

What's Involved, and What It Means

Hot-Button Legal Issues

What's on the Horizon?

Q&A: Do I Have to Remove My Tree?

Q&A: Do I Have to Remove My Tree?

So You've Been Sued...Now What?

First Steps to Take

Who Goes There?

Accessing Units Without Owners