New York Real Estate Lawyer Blog

That is the question in a recent lawsuit filed in Rockland County Supreme Court.

Most real estate attorneys would say that closing with out a certificate of occupancy on a newly constructed house is not a good idea, even a departure from accepted standards.

A certificate of occupancy is the legal notice by the municipality that the house is habitable and constructed in accordance with the building permit. Accordingly, when purchasing a residential piece of real property to be occupied as a dwelling, the attorney should recommend a certificate of occupancy. The failure to have a c/o means that occupancy of the premises "illegal," and the failure to have that document means that any occupancy violates the law.

Although we cannot comment on pending lawsuits, here are the contentions of the parties.

Did you know that there is a way to avoid mortgage taxes that increase the cost of re-finances? The technique known as a “consolidation, modification and extension agreement” (CEMA), and helps a refinancer to pay only the cost of the "new money" being borrowed.

To accomplish a CEMA, the borrower, the borrower's attorney, and the lender prepare new documents which consolidate the old mortgage with the new mortgage. In the process, the old mortgage is assigned to the new lender, and the borrower pays mortgage tax on the "new money." The original mortgage is not “discharged of record,” because the borrower arranges to keep the existing mortgage on the books and then assigns it to the new lender.

The new lender requires a new mortgage for the closing costs and new money, while the new lender and the old lender execute an agreement assigning the old mortgage to the new lender; and all of the debt is consolidated.

Beware, however, the process is complex and sometimes causes considerable time and expense to complete. Consult your local real estate attorney before undertaking a CEMA.

As we reference on our web-site (above), the New York State Property Condition Disclosure Act requires sellers to complete the state mandated form or offer the buyers a $500.00 credit at closing for failure to complete and provide such form in the real estate transaction. Many sellers attorneys recommend that sellers simply provide the credit because you risk litigation over "latent defects" after the real esate closing.

For example, in one recent case the Seller-Defendants answered “No” to certain questions on the New York State Form, and the Plaintiff-Buyer’s home inspector did not report that the property had any material defects. After closing, however, the Buyer allegedly discovered material defects in the property, and commenced suit against the old sellers. The litigation asserted causes of action in fraud and for breach of contract stemming from the allegedly defective conditions

The Supreme Court (trial court) permitted the suit to proceed on the issue of breach of contract and fraud. The Appellate Division, Second Department (appeals court) reversed in part, and dismissed the cause of action for breach of contract because the contract provided that the premises had been inspected and was being sold “as is”.

The appeals court, however, permitted the cause of action alleging fraudulent concealment to proceed against the sellers,

the alleged false representations in the Disclosure Statement support a cause of action alleging fraudulent misrepresentation in that such false representations may be proof of active concealment”.

See Simone v. Homecheck Real Estate Services, Inc., decided July 24, 2007, is reported at 2007 WL2127261.Real

The attorney representing you in the sale will have an opinion as to the property disclosure statement, ask the attorney.

A "closing" is a "closing." When people say they are going to their real estate closing, they are talking about accepting their most expensive investment, fleas and all. If you have a problem with the home before the closing, you should bring it up before the closing, otherwise you are fore-closed from complaining.

This is illustrated by a recent case where the contract of sale provided that the property “will be delivered vacant and clean” at closing. The Seller failed to deliver the property clean, and the Purchaser had to spend $17,000 to remove storage bins, a container and other items, which should have been removed at closing.

To recover his costs, the Purchaser commenced action claiming that the contract required the Seller to deliver the property clean. The Supreme Court, Queens County, did not immediately dismiss the contract claim, but the appeals court (Second Department) reversed and dismissed the contract cause of action. Under the law of New York, the seller’s obligation to deliver the premises “vacant and clean” did not survive the closing of title because it was "merged" in the deed. By accepting the deed, the purchaser forfeited his right to enforce the contract provision--an elementary rule of law. The collateral obligation to deliver the property clean was "extraneous" to the sale of real estate and did not "survive" the delivery of title. Novelty Crystal Corp. v. PSA International Partners, L.P., decided January 15, 2008, is reported at 2008 WL 141502.

The moral of the story-- communicate with your New York real estate lawyer or other professional, especially the closing attorney because you are the ears and eyes of the transaction. Your real estate atttorney does not know the condition of the property unless you discuss it with them ahead of the Closing.

Well, that really depends upon where your "stoop" is sitatuated and whether the police officer thinks you have an open container.

In Brooklyn New York a Prospect Heights man was issued a ticket for drinking beer on his front "stoop," which was several feet from the public sidewalk and not enclosed by a fence. The man was checking his email and drinking a beer at 11:52 pm when a police officer drove up and handed him a summons for drinking in public.

The issue for the court will be whether the "stoop" in front of his four (4) story, twenty (20) unit cooperative building is "public" or "private" property? The man stated that he and his fellow apartment dwellers had been doing this for years without incident, but that's for the court to decide.

In areas like Brooklyn, where apartment dwellers do not necessarily have their own private outdoor spaces, congregating on the stoop is a way to enjoy the outdoors and to watch the goings on of their own neighborhood. Whether a police officer can issue a summons for drinking in public under such circumstances will be decided shortly. In the meantime, the man plans to contest the ticket.

The moral of the story-- be careful where you drink your Brooklyn Lager, or be sure to enjoy one with your friendly New York real estate litigator!!