Judge Declines to Extend Definition of “Tenement House” Used in 1867 Statute to Modern Day Luxury Apartment

In a city like New York, where a rich architectural tradition brushes up against the needs of  modern living on an almost daily basis, the question of when to allow the renovation of older buildings to make way for new luxury apartments is often a difficult one.  This was precisely the issue facing the New York Supreme Court in the recently decided East 62nd Street Assoc., Inc. v. 163-165 East 62nd Street Assoc., LLC.

In this case, the defendant, a developer, filed plans with the New York City Department of Buildings (DOB) to renovate existing adjacent four-story structures so that it could build a single story luxury condominium apartment building on East 62nd Street in Manhattan.  The plaintiff was a neighborhood historic preservation association, which commenced the action asserting three causes of action: (1) A judgment declaring that a restrictive covenant that applied to the property executed in 1869 prohibits the erection of the apartment building because it is a “tenement house” within the meaning of L 1867, ch 908, and the erection of a tenement house is expressly barred by the terms of the covenant, (2) A permanent injunction prohibiting the defendant from erecting the apartment building, and (3) A judgment declaring that the defendant’s application to the DOB contained material, intentional misrepresentations with respect to the specifics of the project.

As of 1869, New York State law defined a “tenement house” as “any house or building, or portion thereof, which is rented, leased let or hired out, to be occupied, or is occupied as the home or residence of three families or more living independently of each other, and doing their cooking upon the premises, or by more than two families upon any floor, so living and cooking, but having a right in the halls, stairways, yards, water-closets or privies, or some of them.” L 1867, ch 908.  The Court, citing the Court of Appeals case Kitiching v. Brown, held that a modern apartment building does not fall within the parameters of the 1867 statutory definition of the term “tenement house” since the concept of the modern apartment building was virtually unknown at that time.  Furthermore, at the time when the statute was enacted, the purpose of the covenant was to avoid the creation of noxious or unsafe conditions.  These conditions simply would not be present if a modern apartment building was built on the property.  Additionally, the defendant submitted evidence that the new apartment building would contain one three-story apartment and four single-story apartments, all of which were owned by their inhabitants.  Since L 1867, ch 908 specified that tenement houses had to be “rented or leased,” the Court reasoned that the new apartment building would not fall under the statutory definition of a “tenement house” for this reason as well.

The Court also held that the plaintiff could not succeed on its third cause of action, since the DOB has primary jurisdiction over allegations that a party made intentional and material misrepresentations about its proposed work.  The Court did clarify that DOB did not have exclusive jurisdiction over this issue, but that the plaintiff was required to exhaust its administrative options before it appealed any DOB ruling.

Lastly, the Court held that the plaintiff was not entitled to a permanent injunction.  Since plaintiff failed on its claim that the restrictive covenant should apply, it had no right that was presently occurring.  Additionally, since the plaintiff’s desired injunction didn’t seek to prevent the complete demolition of a structure, but rather the renovation and ultimate erection of a new structure that could be altered if the plaintiff were to prevail in later litigation, the plaintiff was not irreparably harmed, and the balance of equities did not weigh in its favor.

The Court’s decision in East 62nd Street Assoc., Inc. marks an important victory for developers, and a defeat for preservationists and similar organizations. Real estate attorney, Peter Moulinos, invites developers to contact him with legal inquiries regarding current projects.