When Flooding and Other Problems Occur, Developer and Residents Point Fingers

Back in September the resident-run condo board of 432 Park Avenue in Manhattan sued the developer of the building for $125 million to repair 1,500 alleged defects to the luxury condo building. According to the lawsuit, multiple residents experienced flooding in their units and noise as a result of alleged building defects. They also reported elevators that would get stuck and trap residents for hours.

The lawsuit further alleges that the construction issues have affected the building’s management, causing common charges to go up by 39% and insurance premiums to go up 300%.

The building’s developer denies the allegations made in the September lawsuit, arguing the allegations of safety defects were exaggerated, and that many of the problems it acknowledged were either caused and/or exacerbated by the residents themselves. According to the developer, it tried to address some of the issues listed in the residents’ lawsuit, but it claims the condo association either cancelled appointments or blocked access to the building when repairs were scheduled to be made.

As a result, the developer has filed a counter lawsuit against the condo board for defamation. According to the developer’s lawsuit, 90% of the building’s units were sold at the time the condo association filed its lawsuit, but sales dropped dramatically after the residents started making their allegations against the building’s developer. To back up its point, the developer pointed out that, overall, 2019 was a strong year for luxury condo sales, suggesting the lag in sales at the 432 Park Avenue building was most likely due at least in part to resident complaints. The developer has not specified the amount of damages it is seeking in its lawsuit against its residents, but it’s likely to be tens of millions of dollars.

The president of the condo board denies all the allegations made in the developer’s defamation lawsuit.

At almost 1,400 feet, the luxury condo building, which was built in 2015, held the record for tallest residential building in New York City for a short time and is still one of the slenderest towers. Residents seeking additional work from a developer after a building has been completed is not unusual, and is especially to be expected in a building whose construction is so complicated. According to the developer, the issues experienced by the residents of 432 Park Avenue were nothing out of the ordinary for a new building.

The residents disagreed, and they also complained that their fees for a private restaurant in the building went up from $1,200 per year to $15,000 per year. The developer argued that it had been paying for the losses the restaurant experienced as a result of the fact that the restaurant was used less than had been anticipated. The developer maintains that it went above and beyond its legal obligation in covering the financial losses of the restaurant for as long as it did, and now that the building has been occupied for several years, the added costs of the restaurant should shift to the residents of the building.

At Lubin Austermuehle, we help clients navigate the complex laws and emotionally charged pathways to a court victory or settlement in slander and libel cases, as well as a vast range of other disputes from class action suits to breach of contract. We serve clients throughout Chicagoland from Waukegan, to Skokie and beyond. and the Chicagoland area. You can contact us online here or call us on our toll-free number at 833-306-4933 or locally at 630-333-0333. Take advantage of our FREE consultation, where we can discuss your specific needs and wishes and our ability to meet them.

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