Esposito v Barr

[*1] Esposito v Barr 2015 NY Slip Op 51267(U) Decided on August 20, 2015 Civil Court of The City of New York, Richmond County Straniere, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on August 20, 2015
Civil Court of the City of New York, Richmond County

Lejla Esposito, Claimant,

against

John Barr d/b/a Woodbrooke Estates Section 2B, Defendant.


Lejla Esposito, Claimant,

against

Florence Dennehy, Defendant.


Lejla Esposito, Claimant,

against

Woodbrooke Estates Section 2B, Defendant.





SCR 20016/15



Claimant- Self Represented

Defendant —Michael Swaaley, 4459 Amboy Road, Staten Island, NY 10312
Philip S. Straniere, J.

Claimant, Lejla Esposito, commenced this day small claims action against the defendants, John Barr, Florence Dennehy, and Woodbrooke Estates Condominium Section 2B, alleging that the defendants improperly imposed fines upon her and denied her the use of the community pool. A trial was held on July 31, 2015. Claimant represented herself. Defendants were represented by counsel.

The name of Florence Dennehy sued herein as Florence Hennehy, was amended to reflect the correct spelling. There is also an entity called, "Woodbrooke Estates Home Owners Association, Inc.", which is not named as party.

Claimant stated that she is the owner of 44 Cypress Loop, Staten Island, New York a unit in the development known as Woodbrooke Estates Condominium Section 2B. She testified that she is up to date with her monthly assessments and that the current dispute arose because she failed to timely provide proof to the Board of Managers that she had had her dryer vent and duct work cleaned. Claimant asserted that because of a fire in another unit caused by that owner not cleaning the dryer vent, the Board of Managers required all other unit owners to provide proof of cleaning their respective duct work. The initial completion date was January 31, 2015. The Board extended the date for all home owners until February 15, 2015 because of the harsh winter weather.

Claimant admits that because of health issues she initially requested an extension to clean the venting and provide proof which the Board granted. The documents she submitted indicate that her health issues all arose after the extension date of February 15, 2015 as her doctor's note only has one visit prior to that date. She contends that she completed the cleaning but that she did not submit the required documentation because of her health problems. The receipt she produced was dated March 25, 2015. As a result claimant not timely providing proof, the Board imposed a fine of $100.00 and an additional $5.00 a day penalty. Because she had the work completed in a timely manner, she refused to pay the fine and per diem penalty. As a result the claimant was denied use of the community pool for as long as the levy remained unpaid which has become for the entire summer.

Defendants do not dispute any of the testimony of the claimant. They stated that had the claimant either sent in the proof of compliance with the cleaning requirement or requested additional time to do so, she would not have incurred either the fine or the penalty.

At the close of claimant's case, defendants moved to dismiss the claims against the two individuals as they are board members acting in that capacity and have no personal liability. Defendants also moved to dismiss claimant's entire complaint on the merits because the claimant [*2]is not asking for money damages in this action but is really seeking to have the court declare the Board's action improper.

Defendants' motion to dismiss as to the two individual defendants must be granted. It is clear that they are officers of the condominium association and were acting in that capacity at all times. They have no personal liability.

Defendants' motion to dismiss as to Woodbrooke Condominium, as the remaining defendant, must also be granted. The small claims part of the Civil Court may only grant the relief in regard to causes of action for money only not in excess of five thousand dollars [New York City Civil Court Act (NYCCCA) §1801]. The testimony of the claimant is that she never paid the fine and the penalties. Therefore she has no claim for money damages. Had she paid the fine and penalties and then came to court seeking a refund alleging that the imposition of them by the Condominium violated the declaration and by-laws, she would have had a cognizable claim on its face. In effect because she has not paid those charges, she is asking the small claims court to declare the action of the defendant a nullity and issue an order canceling the obligation. The small claims court lacks such power.

In fact, it is doubtful that the Civil Court has the jurisdiction to grant the relief the claimant is seeking. NYCCCA §212-a gives the court authority grant declaratory relief only in two limited situations. Neither of which applies to the current fact pattern. Claimant's relief may be in the Supreme Court with an action brought pursuant to Civil Practice Law and Rules (CPLR) §3001.

On the other hand, had the court had to decide this case on the merits, that is had the claimant actually made the payments and sought to recover those monies, it is clear that the defendant would have some evidentiary issues.

One problem is whether unit owner's privileges may be suspended for failure to pay either a "fine" and a "penalty" or only for nonpayment of an "assessment." The By-Laws of the Woodbrooke Estates Home Owners Association, Inc. in Article VI provides:

Section 5. Suspension of Membership. The rights of membership are subject to the payment of periodic assessments levied by the Board of Directors, the obligation of which assessment is imposed against each Member and becomes a lien upon the property of any Owner against which such assessments are made as provided by Article VI of the Declaration. During any period in which a Member shall be in default in the payment of any assessment levied by the Association, the voting rights, if any, of such Member and the Member's right to the use of the Common Properties may suspended until such assessment has been paid. Such rights of a Member may also be suspended, after notice and a hearing, for a period not to exceed thirty (30) days, for violation of any rules and regulations established by the Board of Directors governing the use of the Common Areas.

The language of the above section makes it clear that suspension of membership rights [*3]can be triggered by the nonpayment of an assessment. Therefore how the governing documents define "assessment" is a key question.

Article IV of the Declaration of Covenants, Restrictions, Easements, Charges & Liens For Woodbrooke Estates provides:

Section 3. Extent of Members' Easements. The rights and easements of enjoyment created hereby shall be subject to the following:(a) The right of the Association, as provided in its By-Laws to suspend the enjoyment rights of any Member for any period during which any assessment remains unpaid, and for any period not to exceed thirty (30) days for any infraction of its published rules and regulations;

Article VI of the Declaration states: Section 2. Purpose of the Assessment. The assessments levied by the Association shall be used exclusively for the improvement and maintenance and the use and enjoyment of the Common Properties, including without limiting the foregoing, the taxes and insurance thereon and repair, replacement, and additions thereto, and the cost of labor, equipment, materials, services, management and supervision thereof.Section 4. Assessments. The Association's Board of Directors shall from time to time, but at least annually, fix and determine the budget...and shall send a copy of the budget to each Member prior to assessing the Members thereon. The Board shall determine the total amount required, including the operational items such as insurance, repairs, reserves, maintenance and other operating expenses, as well as charges to cover any deficits from prior years and capital improvements approved by the Board.Section 6. Effect of Non-Payment of Assessment; The Personal Obligation of the Member; The Lien, Remedies of the Association.If an assessment is not paid on the date when due,...then such assessment shall become delinquent and shall together which such interest thereon, any late fees imposed by the Board and cost of collection thereof as hereinafter provided, thereupon become a continuing lien on the Member,...

Based on these sections, the imposition of late fees and penalties do not qualify as an "assessment." An assessment is an obligation levied against all of the unit owners based on the budgetary needs of the condominium and are not a charge imposed on an individual unit owner. Therefore the defendants must establish a separate basis for imposing them against the claimant.

The By-Laws of Woodbrooke Estates Condominium -Section II-B provides:

Article III. Board of Managers.

Section 5. Powers.

1. To determine and levy monthly assessments ("common charges") to cover the cost of common expenses, payable in advance. The Board of Managers may increase the monthly assessments or vote a special assessment of that amount, if required, to meet any additional necessary expenses,..;

Article VI. Finances.

Section 2. Assessments.

The Board of Managers shall, from time to time, but at least annually, fix and determine the budget representing the sum or sums necessary and adequate for the continued operation of the Condominium and shall send a copy of the budget and any supplement to the budget to every Home Owner and mortgagee....Special assessments, should such be required, shall be levied and paid in the same manner as hereinabove provided for regular assessments...In the event of a default in payment of monthly charge assessments by any Home Owner, the Board, at its sole option may declare the common charge assessment on said Home Owner's Home for the balance of the fiscal year immediately due and payable....The Board may charge the delinquent Home Owner a fee of not more than twenty dollars to cover the additional burden of the Board occasioned by the lack of timely payment. Interest at the rate of 15% per annum, but in no event greater than the highest legal rate, may also be collected by the Board on the common charge assessment from its due date to the date payment is actually received from the Home Owner. Special assessments, should such be required, shall be levied and paid in the same manner as hereinabove provided for regular assessments.

Article IX. Default.

In the event a Home Owner does not pay any sums, charges or assessments required to be paid when due, the Board of Managers, acting in behalf of the Board shall notify the Home Owner and the mortgagee, if any, of such Home. If such sum, charge or assessment shall remain unpaid for 90 days after giving of such notice, the Board may foreclose the lien encumbering the Home as a result of the non-payment of the required monies as set forth in the Declaration..., in the same manner as the foreclosure of a mortgage. In the event the owner of a Home does not pay the assessment required to be paid by him within thirty (30) days of its due date, said sum shall bear interest at the maximum amount permitted by the State of New York from its due date and said Home Owner shall be liable for the Condominium's reasonable costs and a reasonable attorney's fee incurred by it incident to the collection or enforcement of such lien.

Based on the foregoing it is apparent that "fines" and "penalties" are not "assessments." The defendants cannot use the procedure for enforcement of an assessment against this claimant home owner. However, it is axiomatic that the Board in its management functions and using its best business judgment can impose reasonable rules and regulations governing home owners as well as levying fines and penalties for violation of them.

Therefore in order to levy the fine and penalty on the claimant, the defendant needed to provide proof that the Board, in compliance with the Declaration and By-laws, passed resolutions requiring the certification of the cleaning of the dryer vent, providing for a fine for the failure to do so, and a penalty in the event the unit owner failed to pay the fine. The defendant has submitted documentation that the fine and penalty were levied and that pool privileges would be denied for nonpayment, but no proof when such resolutions and procedures were put into place.

Judgment for defendants. Claimant has failed to prove her prima facie case. The small claims part cannot grant the relief she is seeking. Her other contentions that the Board members "harass" her and give certain home owners more privileges than others are not sustainable. If claimant is dissatisfied with how the Condominium is being run, the declaration and by-laws provide avenues to address those situations and provide a basis for an action in the Supreme Court if all delineated avenues are exhausted.

Judgment for defendants. Claimant's cause of action is dismissed on the merits.

Exhibits, if any, will be available at the office of the clerk of the court thirty days after receipt of a copy of this decision.

The foregoing constitutes the decision and order of the court.

Dated: August 20, 2015

Staten Island, NY

____________________________________

HON. PHILIP S. STRANIERE

Judge, Civil Court