Owners of real estate often need access to neighboring properties to make improvements or repairs. Access is sometimes neighborly and collegial; however, circumstances are often adversarial and lead to litigation.
In this regard, Section 881 of the Real Property Actions and Proceedings Law provides that:
When an owner or lessee seeks to make improvements or repairs to real property so situated that such improvements or repairs cannot be made by the owner or lessee without entering the premises of an adjoining owner or his lessee, and permission so to enter has been refused, the owner or lessee seeking to make such improvements or repairs may commence a special proceeding for a license so to enter pursuant to article four of the civil practice law and rules. The petition and affidavits, if any, shall state the facts making such entry necessary and the date or dates on which entry is sought. Such license shall be granted by the court in an appropriate case upon such terms as justice requires. The licensee shall be liable to the adjoining owner or his lessee for actual damages occurring as a result of the entry.
Needless to say, each and every element of Section 881 has been, and continues to be, a source of litigation.
DDG Warren LLC v. Assouline Ritz 1, LLC, 2016 NY Slip Op 02926 (App. Div. 1st Dept. April 19, 2016)
Supreme Court denied respondent’s request for a fee for the licenses granted to the petitioner pursuant to RPAPL § 881 and, as follows, granted the application for a contemporaneous license fee:
Although the determination of whether to award a license fee is discretionary, in that RPAPL 881 provides that a “license shall be granted by the court in an appropriate case upon such terms as justice requires” (emphasis added), the grant of licenses pursuant to RPAPL 881 often warrants the award of contemporaneous license fees…After all, “[t]he respondent to an 881 petition has not sought out the intrusion and does not derive any benefit from it . . . Equity requires that the owner compelled to grant access should not have to bear any costs resulting from the access”…In the circumstances presented here, where the granted license will entail substantial interference with the use and enjoyment of the neighboring property during the planned 30-month period, thus decreasing the value of the property during that time, it was an improvident exercise of discretion to postpone until the end of the three-year license period the matter of the fees to which respondents must be entitled.
With respect to the posting of a bond:
The court had the authority to order a bond…even though respondents were covered by petitioner’s insurance…It was particularly appropriate for the court to order a bond since it had postponed the issue of license fees. Since the bond secures both possible damages and the payment of the license fees, in view of our remand for the purpose of awarding license fees to respondent, it may be necessary for Supreme Court to revisit the amount of the bond.
And with respect to attorneys’ fees:
It was not an improvident exercise of discretion for the court to award attorneys’ fees to all three sets of respondents, each with its own counsel, instead of limiting them to one set of attorneys’ fees. Similarly, it was not an improvident exercise of discretion for the court to decline to set strict temporal limits on the attorneys’ fees[.]
Matter of AY Phase II Dev. Co. LLC v. 497 Dean St. Residences, LLC, 2016 NY Slip Op 32389(U) (Sup. Ct. K. Co. December 5, 2016)
Petitioner/Developer applied to the Supreme Court, pursuant to RPAPL § 881, for a license to access Respondent’s neighboring property; and Respondent cross-moved to dismiss the petition, or, in the alternative, for the granting of a license fee for the use of its property.
Supreme Court summarized the petition:
Developer owns a leasehold interest in property abutting 497 Dean, in which it plans to construct a new building consisting of a New York City public school on the lower floors and market-rate residential apartments on the upper floors (project is referred to as the “B15 Project”). The B 15 Project entails demolition of the existing structure and excavation to a depth lower than the foundations of 497 Dean for construction of a building that will rise higher than the roof of 497 Dean.
For the demolition, Developer states that an 8-feet high construction fence must be installed on 497 Dean to close off access to it from the structure being demolished. Developer further states that demolition will take approximately two weeks, at which time the construction fence will be removed.
To excavate to a depth lower than the foundations of 497 Dean, Developer states that the relevant Building Code sections require it to (1) inspect and document the currently existing conditions of 497 Dean; (2) prepare and implement a monitoring plan including, if necessary, the installation of vibration monitors, crack gauges, optical survey points, noise meters, etc., for 497 Dean; and (3) protect and provide vertical and lateral support for the footings and foundations of 497 Dean. Developer submits a copy of its “Code-compliant design for support of the excavation” produced by its engineer Mueser Rutledge Consulting Engineer which shows “a vertical ‘secant pile wall’ abutting and supporting [ 497 Dean], laterally supported by diagonal threaded bars (“tie backs”)” which are temporary supports that, once the project is completed, can be abandoned in place. Developer estimates that excavation and foundation construction will take approximately 12 months to complete.
In addition, because the B 15 Project will be constructed higher than 497 Dean, Developer states that it must install roof and other protections over 497 Dean. Developer also states that certain portions of 497 Dean’s foundation may require waterproofing because it may be exposed during excavation. Developer estimates that construction of the new building, after demolition and excavation, will take approximately 36 months to complete. Thus, Developer seeks an Order granting it entry to 497 Dean for a total period of 48 months.
According to Developer, it has offered to work jointly with Respondent to develop plans for the protection of 497 Dean during the process of constructing the B 15 Project but that Respondent has refused such access. Developer states that, upon obtaining an § 881 license to enter 497 Dean, it shall provide commercial general liability insurance with an aggregate limit of $20,000,000.00 listing Respondent as an additional insured and that it will agree to indemnify Respondent against any claim for personal injury, death or property damage arising from Developer’s access to and entry upon 497 Dean.
The motion to dismiss:
[R]espondent submits that it has been and remains willing to enter into a voluntary license agreement with Developer but that Developer has not adequately prepared for the dangerous excavation and foundation work that it wants to perform. In support, Respondent proffers the opinion of its engineer, Ira Beer, P.E., who identified alleged serious omissions in Developer’s Support of Excavation (“SOE”) drawings, gaps in their understanding of 497 Dean’s foundation, and misleading statements in their petition wherein they claim to have Department of Buildings’ approval to begin excavation but with drawings submitted as incomplete and labeled “preliminary.” Respondent states that both Developer’s first SOE drawings dated October 9, 2015, which called for underpinning 497 Deans foundation, and the second SOE drawings dated January 4, 2016, assume knowledge of 497 Dean’s foundation and therefore lack critical information. Respondent contends that Developer has yet to utilize a “test pit” to learn essential information about 497 Dean’s foundation.
Respondent’s position:
[D]eveloper has refused to reply to its engineer’s request for information and provide him with accurate plans. For example, Respondent states that the location and shape of the proposed construction fence as reflected in Developer’s drawing are erroneous but that, despite his request, Developer never provided Mr. Beer with corrected drawings.
Respondent also claims that Developer has been withholding critical details regarding the length and invasiveness of the B 15 Project during their negotiations. Specifically, that Respondent did not know until the instant petition was filed that the entire process will take at least four years, that Developer will need access to its site through 497 Dean, and that scaffolding will be covering the roof of 497 Dean during much of the process. Respondent argues that because Developer has provided inaccurate information, withheld important details, and relied upon incomplete drawings, the petition should be dismissed.
In the alternative, in the event the Court grants a temporary license to Developer, Respondent contends that it is entitled to a monthly license fee and payment for the engineering and legal fees it has incurred throughout the process of negotiating the license agreement. Respondent contends that it is facing an intrusive and lengthy imposition that will limit its ability to use its property and which will benefit Developer.
Developer’s reply:
[D]eveloper argues that Respondent has been unreasonable in opposing the petition claiming a Jack of information while simultaneously refusing Developer’s request for access to 497 Dean to conduct a pre-construction survey that will allow Developer to gain the necessary information to formulate its protection plan for 497 Dean. Developer also contends that the Court should not award any fees for a temporary license because Respondent has engaged in dilatory tactics to avoid entering into a voluntary agreement[.]
The applicable law:
RPAPL § 881 allows property owners who seek “to make improvements or repairs to real property” to bring a proceeding in order to obtain a license to enter upon the premises of adjoining property owners where permission to so enter has been sought by the property owners and refused by the adjoining property owners, and the property owners’ real property is “so situated that such improvements or repairs cannot be made by the [property] owners … without entering the premises of [the] adjoining [property] owners.” The construction of a new building is an improvement of real property within the meaning of § 881[.]
The petition and affidavits must “state the facts making such entry necessary and the dates on which entry is sought”…Further, a license “shall be granted by the court in an appropriate case upon such terms as justice requires.” In determining the issue of whether to grant petitioners a license pursuant…the court must apply a “standard of reasonableness”…”The court must balance the competing interests of the parties and should grant the issuance of a license when necessary, under reasonable conditions, and where the inconvenience to the adjacent property owners is outweighed by the hardship of their neighbors if the license is refused”[.]
Concluding that:
Based on the papers submitted, this Court is inclined to grant Developer a license[.] Respondent does not dispute that Developer needs access to 497 Dean to construct the B15 Project. Nor does Respondent argue that a four-year license period is unreasonable given the type of construction Developer plans to undertake. In addition, Developer is no longer pursuing “underpinning” to excavate 497 Dean’s foundation, which could have been considered a permanent encroachment warranting a denial of a RPAPL § 881 license…However, to address the issues raised by Respondent in its cross-motion concerning purported inaccurate information and the lack of specificity with regards to knowledge of 497 Dean’s structural characteristics and the extent of intrusion during the duration of the project, the Court finds that a conference must be held to address these issues and set forth license parameters. Moreover, since the preconstruction survey has now taken place, the Court must determine what remaining deficiencies, if any, exist with regards to Developer’s petition according to Respondent.
[T]his Court is inclined to award Respondent license fees and costs as determined by the Court. Although the determination of whether to award a license fee is discretionary, where the granted license will entail substantial interference with the use and enjoyment of the adjacent property for a lengthy period of time, such as is the case herein, fees are warranted…However, neither party has submitted sufficient information for this Court to make a determination as to what would constitute reasonable license fees and/or costs in the circumstances presented herein. Accordingly, this issue shall also be addressed at the conference.
Van Dorn Holdings, LLC v. 152 W. 58th Owners Corp., 2016 NY Slip Op 31598(U) [Sup. Ct. N.Y. Co. August 19, 2016]
Petitioner applied to Supreme Court, pursuant to RPAPL § 881, for an Order granting Petitioner access to Respondent’s neighboring property.
Supreme Court summarized the petition:
Petitioner alleged that it was the owner of a 16 story residential apartment building at 150 West 58th Street, New York, New York, that respondent 152 West 58th Street Owners Corp. (“152 Corp.”) owned the cooperative apartment building at 152 West 58th Street, New York, New York, and that respondent David Fallarino was the proprietary lessee of the penthouse apartment in the 152 property.
In August of 2015, the DOB issued the partial vacate order on respondents’ roof, which stated, in pertinent part, that any persons occupying any parts of the structure located within 30 feet of the eastern portion of the roof were to vacate the premises forthwith.…The order further stated that it was issued because
there is imminent danger to life or public safety of the occupants or property, in that due to defective brick work at [petitioner’s building] being loose and bulging and in danger of falling, this renders the [e]astern portion roof [sic] unsafe to utilize.
Petitioner’s assertions:
The petitioner asserted that the portion of respondents’ roof subject to the partial vacate order…was adjacent to the penthouse apartment in which respondent Fallarino resided. Ex. A.…Further, petitioner asserted that, according to the affidavit of engineer Irving Chesner, P.E. submitted in support of its application, in order to lift the partial vacate order on respondents’ roof, it had to remedy the facade deterioration in its premises adjacent to respondent’s roof.…This included deteriorated mortar and brickwork, cracked bricks, stones, sills, and metal, and rusted metal and lintels…Petitioner also maintained that it had to install overhead protection on the northern side of respondents’ roof to protect the roof during its work[.]
Petitioner also claimed that, according to Chesner’s affidavit, portions of the facade walls in the petitioner’s courtyard were unstable.…These portions of the walls were adjacent to the 152 alley, a walkway on the 152 property used by staff and residents of the 152 property.…According to Michael Yates, President of Yates Restoration Group, Ltd., petitioner’s contractor, scaffold needed to be dropped from petitioner’s building and hung over the 152 alley so petitioner parties could access the wall to perform the facade repair, which would require protection to the 152 alley[.]
The petition noted that “while [p]etitioner intend[ed] to perform its work as expeditiously as possible, conditions [could not] be fully ascertained until a close up inspection and until probes [could] be performed from scaffolding. Probes [would] reveal if the underlying causes of observed surface conditions [were] due to deteriorated structural steel.”…Yates also stated in his affidavit that the scope of the work in petitioner’s courtyard and on the wall adjacent to respondent’s roof [could not] be “fully ascertained” until inspection probes [were] performed in those areas[. ]
Respondent’s answer:
[R]espondents denied, inter alia, that they had refused petitioner parties reasonable access to the 152 property. Respondents also asserted numerous counterclaims, including, inter alia, that petitioner has not justified the time period sought for the license requested.…They also asserted that petitioner had to pay them an amount no less than $5,500 per month as compensation for the use of the 152 property and that petitioner had to post a bond to secure the payment of any damages occurring during petitioner’s work.…Further, respondents maintained that, if petitioner exceeded the period of the license, it should be penalized $500 per day[.]
The interim order:
By interim…this Court held, inter alia, that it could not grant a license without knowing how long the proposed work would last. The petition was granted to the extent of, among other things, allowing probing of the facade of petitioner’s building and the wall of petitioner’s building adjacent to respondent’s roof in order to ascertain how long it would take to perform the necessary repairs to those areas.
The subsequent developments:
After the probing was conducted, a conference was conducted before this Court…to discuss the status of the case. At the conference, the parties agreed that the work on the roof would be completed by September 19, 2016 and that the remainder of the work would be completed within one year thereafter, by September 19, 2017. The parties disagreed as to whether respondents were entitled to a license fee and were given the opportunity to submit papers to the court in this regard.
The position of Petitioner:
In an affirmation in support of the motion, Craig Notte, Esq., counsel for petitioner, asserts that, because “portions of the brickwork facade on the western wall of [p]etitioner’s [b]uilding adjacent to the eastern side of the 152 [b]uilding are unstable and a threat to the 152 [p]roperty and persons thereon”, petitioner must be granted a license to enter the 152 property to make repairs.
Petitioner maintains that, according to Chesner, the partial vacate order on respondents’ roof was required by section 28-302.5 of the New York City Building Code to be remedied within 30 days. It further maintains that Chesner’s affidavit establishes that portions of the facade walls in the petitioner’s courtyard, adjacent to the 152 alley, a walkway on the 152 property, are unstable and in need of repair. Further, petitioner asserts that Yates’ affidavit establishes that the scaffold to be installed in petitioner’s courtyard to perform the courtyard work must be brought in through the 152 alley and that the courtyard work requires the installation of 152 alley protection so that people and property in the 152 alley can be protected during the courtyard work.
Petitioner maintains that it cannot perform the repairs needed to its facade and to petitioner’s wall adjacent to respondents’ roof without access to the 152 building. It asserts that, pursuant to RPAPL § 881, it is not required to pay a license fee, post a bond, or pay attorneys’ fees to the respondents. Susan Virgadamo, Senior Vice President and Registered Managing Agent with William Moses Co., Inc. (“Moses”), managing agent of petitioner’s building, states in an emergency affidavit in support of the motion that petitioner has tried, in vain, to obtain from respondents a license to enter the 152 property to perform the work necessary to lift the partial vacate order on respondents’ roof, install the respondents’ roof protection, and install the 152 alley protection.
The position of Respondent:
[F]allarino, in an affidavit in opposition, states, inter alia, that respondents have not refused access to the 152 property; rather they have requested a fair and reasonable license agreement for such access, which petitioner has allegedly failed to offer. He maintains that the parties and their experts agreed in October, 2015 that it would be reasonable for petitioner to take 4 weeks to install protection in the 152 alley and on respondents’ roof; 6 months to perform the work necessary to cure the partial vacate order on respondents’ roof, and 18 months to perform the work necessary in the 152 alley. In asserting that the work on their roof would take 6 months, respondents rely, inter alia, on what they represent is the opinion of Timothy Lynch, P.E., Assistant Commissioner of Investigative Engineering Services for the DOB.
Anthony Accardo, P.E., an engineer, also submits an affidavit on behalf of respondents in opposition to petitioner’s motion. Accardo opines that a 6 month license to allow petitioner to perform work on petitioner’s wall adjacent to respondent’s roof and an 18 month license to allow petitioner to provide protection in the 152 alley would allow sufficient time to complete the work in question.
Carl Tait, a former president of the Board of Directors of 152 Corp.,…states that petitioner has delayed for years in making the necessary repairs to petitioner’s building and, in essence, that the repairs required are attributable to this neglect.
Alternatively, respondents argue that, if petitioner is granted a license, then this Court should order, inter alia, that: 1) the duration thereof should be limited to 6 months for access to respondents’ roof and 18 months for access to the 152 alley, subject to reasonable force majeure extensions and a showing that best efforts have been made to complete the work, with penalties of no less than $500 per day for exceeding these deadlines; 2) petitioner must pay a license fee of no less than $5,500 per month for as long as petitioner uses the respondents’ roof and/or the partial vacate order on respondents’ roof remains in effect; 3) petitioner must name respondents as additional insureds by endorsement on their own and on their contractors’ commercial liability insurance policies; 4) petitioner must defend, indemnify and hold harmless respondents from any claims related to the property protection or petitioner’s work and petitioner must be liable for any damages suffered by respondents as a result of the license; 5) petitioner must post a payment and performance bond in the amount of $500,000 or, in the alternative, place in escrow not less than $250,000 to secure the payment of damages and completion of the work; 6) a hearing must be held at the time the work is completed to ascertain the extent of the damages, if any, sustained by respondents.
The request for a license fee:
In an affirmation submitted at the request of this Court…respondents argue that they are entitled to $5,500 per month in license fees, reimbursement for attorneys’ fees incurred in connection with this proceeding, as well as for the costs they incurred in hiring an engineer in connection with this matter. In support of their argument that they are entitled to attorneys’ fees and license fees, respondents rely, inter alia, on DDG Warren LLC v Assouline Ritz I, LLC, 138 A.D.3d 539 (1st Dept 2016).
Opposition to the license fee request:
In opposition to respondents’ request for fees, petitioner argues, inter alia, that neither DDG Warren nor any other case entitles respondents to license fees or reimbursement of attorneys’ fees or engineering fees. Petitioner asserts that all of the cases cited by the First Department in which a license fee was awarded involved elective work or new construction, unlike here, where mandatory statutory repairs were involved. Petitioner further asserts that the area of the roof affected is only about 1/10th of the square footage of respondent Fallarino’s terrace and that the area is used only about five months per year. Further, petitioner maintains that respondents’ demand for petitioner to post a bond is without merit since they have no valid claim for a monetary award or other compensable loss.
Respondent’s reply:
In an affirmation in further support, respondents assert that, although the total size of the terrace in question is 2,000 square feet, the vacate order prevents Fallarino from using the vast majority (1,200 square feet) of it, which abuts petitioner’s building, and is the far more valuable portion of the terrace since it faces Central Park. Respondents insist that, following the issuance of the interim order…they allowed petitioner access to the premises beginning on February 24, 2016, at which time repair work began. Respondents further assert that petitioner’s argument that license fees and reimbursement of professional fees may not be awarded when work is performed as required by statute is without merit. Finally, respondents assert that, had petitioner accepted their initial six-month license term to complete the terrace work, which was supported by respondents’ engineer, the DOB’s engineer, and, eventually petitioner’s engineer, this lawsuit could have been avoided.
Holding as to the license that:
Petitioner states a basis for the granting of a license pursuant to RPAPL § 881. Petitioner has established through the affidavits submitted in support of the motion that repairs are necessary to the petitioner’s building which cannot be made without access to the 152 property. “Courts are required to balance the interests of the parties and should issue a license when necessary, under reasonable conditions, and where the inconvenience to the adjacent property owner is relatively slight compared to the hardship of his neighbor if the license is refused.”…Respondents “do not dispute that [p]etitioner’s building is unsafe and that the [p]etitioner’s [w]ork needs to be done.”…Although the time needed to complete the work had been in dispute, after the probing was conducted, the parties represented to this Court…that they had agreed that the work on the roof would be completed by September 19, 2016 and that the remainder of the work, in the 152 alley, would be completed by September 19, 2017.
In light of the foregoing, a license is granted to petitioner for the work to be performed on that portion of its building adjacent to respondent Fallarino’s roof for the period of February 24, 2016 until September 19, 2016. Additionally, a license is granted to petitioner for work to be performed in the 152 alley for the period of February 24, 2016 until September 19, 2017. Both of said licenses are granted nunc pro tunc.
As to the license fee:
License fees are routinely awarded to a respondent in a proceeding pursuant to RPAPL 881 since the respondent “has not sought out the intrusion and does not derive any benefit from it . . . Equity requires that the owner compelled to grant access should not have to bear any costs arising from the access”[.]
Here, respondent Fallarino submitted an affidavit attesting to the fact that the license required to repair the deterioration of petitioner’s building would delay him from making desired improvements to the terrace and from using those improvements he has already made.…Fallarino asserts that approximately 1,250 square feet of his 2,000 square foot terrace cannot be used and that, although 400 square feet of it can be, the smaller portion is in the shadow of a tall building.…Although Fallarino requests a license fee of $5,500, this Court finds the said request excessive. Fallarino states that his monthly carrying charges are $10,084 and that the terrace comprises approximately 29% of the total square footage of his apartment.…Thus, the loss of his entire terrace would be worth approximately $2,924.36 of his monthly carrying charges, or 29% or $10,084, per month. However, since Fallarino is not losing the entire terrace, this Court finds that $2,000 per month is a just and equitable license fee under the circumstances of this case[.]
And as to attorneys’ and engineering fees:
Contrary to petitioner’s argument, respondents are entitled to reimbursement by petitioner for attorneys’ fees incurred in this action[.]
Justice also requires that petitioner reimburse respondents for their reasonable engineering costs incurred in this matter…As noted in detail above, probing of the walls of petitioner’s building had to be conducted in order to determine how long petitioner’s work would take. Respondents clearly had a right to have an engineer of their choosing present when this probing occurred to ensure that petitioner’s engineer would give an accurate estimate of how long the work would take.
Van Dorn Holdings, LLC v. 152 W. 58th Owners Corp., 2017 NY Slip Op 02905 (App. Div. 1st Dept. April 13, 2017)
The Appellate Division summarized the appeal:
Order and judgment [of] Supreme Court, New York County (Kathryn E. Freed, J.), entered on or about August 22, 2016, which insofar as appealed from as limited by the briefs, in this proceeding pursuant to RPAPL 881, ordered petitioner to pay respondent David Fallarino a monthly license fee of $2,000 from February through September 2016, ordered petitioner to pay a $500 penalty for each day beyond the term of the license that its work is not completed, and awarded respondents attorneys’ and engineers’ fees, unanimously modified, on the facts and in the exercise of discretion, to vacate, with leave to renew, the $500 penalty for each day beyond the license term that petitioner fails to complete its work, or to seek such other available relief as respondent deems appropriate, and otherwise affirmed, without costs.
Recited the governing law:
Although the determination of whether to award a license fee is discretionary, in that RPAPL 881 provides that a license shall be granted by the court in an appropriate case upon such terms as justice requires, the grant of licenses pursuant to RPAPL 881 often warrants the award of contemporaneous license fees…This is because the respondent to an 881 petition has not sought out the intrusion and does not derive any benefit from it…Equity requires that the owner compelled to grant access should not have to bear any costs resulting from the access'[.]
Concluding that:
Here, Supreme Court did not abuse its discretion in requiring petitioner to pay respondent Fallarino a license fee where the necessary repairs to petitioner’s building will deprive Fallarino of the use of a portion of his property. Notwithstanding that petitioner’s intrusion was for the purpose of repairs, as opposed to new or elective construction, Fallarino should not have to bear the loss uncompensated…Supreme Court also did not abuse its discretion in granting respondents attorneys’ and engineers’ fees. “A property owner compelled to grant a license should not be put in a position of either having to incur the costs of a design professional to ensure petitioner’s work will not endanger his property, or having to grant access without being able to conduct a meaningful review of petitioner’s plans”[.]
However, we modify so much of the order as imposed a $500 daily penalty on petitioner for each day beyond the license term that work is not completed, to instead allow respondents, if the work is not completed within the license period, to move for a determination of the proper amount of any penalty, or increase or continuation of the licensing fee, or any other relief available to them[.]
Matter of 2225 46th St. LLC. v. Hahralampopoulos, 2017 NY Slip Op 27033 (Sup. Ct. Q. Co. January 17, 2017)
Supreme Court entertained an application for an Order, pursuant to RPAPL § 881, granting petitioner a license to enter upon respondents’ premises for the purposes of performing demolition and conducting improvements and repairs.
The Court summarized the facts:
Petitioner North 7-8 Investors, LLC moves this Court, pursuant to RPAPL §881, for an order granting the petitioner a license to enter the adjoining properties owned by the respondents in order to demolish an abutting 50,000 square foot warehouse building and construct a new building. In order to perform the demolition, the New York City Administrative Code requires a protective fence or other perimeter wrap such as tarps to be constructed to protect the properties of adjacent property owners that are within fifteen (15) feet of the demolition operations. In this case, there are apparently eighteen abutting properties whose back yards are adjacent to the existing structure. Each property is approximately 20 feet wide by 100 feet long. The petitioner avers that the encroachment of the fence will be approximately ten (10) feet into the back yards of each of the abutting properties. The length of time of the demolition is estimated to be six to eight weeks and four months for the total operation.
Application of RPAPL § 881:
RPAPL 881 authorizes the court to grant the license on such terms as justice requires. This language is broad and allows for the flexibility and full scope upon which equity depends. In a normal commercial setting, where a license agreement cannot be reached, there is no license. Where a license pursuant to RPAPL 881 is sought, the license can be compelled even though no agreement is reached, and, in that situation, the terms of the license are set in the discretion of the court.
Here, there is no dispute that the petitioner will require access to the respondents’ property to protect the abutting properties from falling debris during the demolition portion of the project. Hence, access is deemed necessary[.]
While the petition does fail to set forth the dates for which access is sought as required by the language of RPAPL 881, the petitioner has stated that it seeks access for approximately four months. There is little purpose in dismissing the petition on this ground and requiring the petitioner to bring a new petition when the Court can simply set the duration of the license in its order. Hence, The Court sets the duration at one (1) year, unless the project is completed sooner, finding that four (4) months is overly optimistic goal.
Section 881 provides that a license shall be granted “upon such terms as justice requires.” Such terms as justice requires extends to the nature and extent of access that is necessary, the duration such access may be necessary, as well as what protections may be necessary to safeguard the adjoining owner’s property.
Noting that:
The statute and case law provide that petitioner is strictly liable for any damage it may cause to respondent’s property…Nonetheless, the court is not limited to requiring bonds and insurance to ensure that petitioner will be able to compensate respondent for any damage. Justice also requires that the terms of the license provide for safeguards to prevent damage from occurring, particularly where a respondent is compelled to grant access to his property[.]
In this regard, it must be remembered that section 881 compels a property owner to grant access for the benefit of another. The respondent to an RPAPL 881 petition has not sought out the intrusion and does not derive any benefit from it. The court must be mindful of the fact that it is called upon to grant access after the parties have failed to reach an agreement, and must not allow either party to overreach and use the court to avoid negotiating in good faith.
The risks and costs involved in the use that a petitioner makes of its neighbor’s property should be wholly borne by the petitioner. Equity requires that the owner compelled to grant access should not have to bear any costs resulting from the access, including steps necessary to safeguard his or her property. In this case, the intrusion is minimal, limited to a portion of the back yards of the respondents.
Respondents seek reimbursement for expenses incurred in retaining an architect or engineer to review the petitioner’s plans, and in retaining an attorney to negotiate and draft a license agreement. They further seek reimbursement for attorneys’ fees incurred in opposing this petition. Respondents have not, however, hired an architect or engineer, and the Court finds this unnecessary.
This is not a case where the petitioner sought to conduct underpinning or other prospectively dangerous activities to respondent’s property. It is more akin to the placement of a sidewalk bridge[.]
The opponents of the application paint a picture of destruction and hardship that does not comport with the reality of the situation, and appears calculated to exact a disproportionate fee in exchange for license to conduct the construction activities contemplated by the petition. The erection of a fence on their property involves the placement of support posts, and requires access to the property in order to erect the protective fencing. The respondents have identified no special or extraordinary damages that are prone to arise from the building of this fence.
This case does not require that the petitioner pay the respondents’ reasonable fees incurred in reviewing the petitioner’s plans and making counter-proposals or ongoing monitoring of the work during the term of the license. Moreover, the payment of respondents’ legal fees shall not be required.
With the admonition that:
However, while the access is necessary to enable petitioner to complete its improvement, it is not just that the petitioner obtain the access without cost, particularly for a project of this size where such fees would not constitute a hardship. Courts have awarded license fees as a condition of a license pursuant to RPAPL[.]
Other conditions the court may impose include posting a bond, obtaining insurance coverage, agreeing to indemnify the adjacent landowner and paying for the use of the license[.]
Concluding that:
Rather than set a somewhat arbitrary fee, this Court directs the petitioner and respondents to each submit one expert affidavit from a real estate expert as to the value of the use and occupancy of ten (10) feet of a backyard piece of property in the subject area.
And awarding petitioner a license to enter respondents’ property on the following terms and conditions:
- The license is awarded to 2225 46th St, LLC only and shall be for a term of one (1) year, or less, if the project is completed before then.
- The petitioner is granted access to the back yards of the respondents’ properties for the purpose of installing demolition fencing and other protective structures.
- Petitioner’s workmen and contractors are allowed access to respondent’s premises only from Mondays through Fridays, between the hours of 8:30 a.m. to 5:00 p.m.
- Petitioner shall procure insurance, in the amount of $1,000,000, covering all of the respondents by name, and listing respondent properties as part of the covered work site, for any liability respondent may incur for property damage, personal injury, or wrongful death, including any liability under the Labor Law, as a result of petitioner’s work, whether or not caused by the negligence of petitioner or its employees, agents, contractors or subcontractors, and providing respondent first-party benefits to cover any damage to his property, including damage caused by earth movement. Petitioner shall maintain this insurance for the duration of this license.
- Petitioner shall indemnify and hold respondent harmless to the fullest extent permitted by law for any liability, claims, damages or losses, including attorneys’ fees he may incur as a result of petitioner’s work, whether or not caused by the negligence of petitioner or its employees, agents, contractors or subcontractors.
- Petitioner shall immediately report, in writing, to respondent any damage to respondent’s property caused by petitioner’s work.
- Petitioner shall cure any violation placed against respondent’s property by a governmental or administrative agency as a result of petitioner’s work. Petitioner shall reimburse respondent for any fines or penalties imposed as a result of such violations.
- Petitioner shall take all steps necessary to remove any mechanic’s lien, or other encumbrance, against respondent’s property arising from petitioner’s work or use of respondents’ premises.
- Petitioner shall submit one expert affidavit and respondents shall collectively submit one expert affidavit from a real estate expert detailing the value and use and occupancy of ten (10) feet of a backyard portion of the respondents’ property.
- Petitioner shall give an undertaking in the amount of $1 million to secure payment by petitioner of any damage to respondents’ property, to secure payment by petitioner of the license, architectural and attorneys’ fees required by this order as a condition of the license, and to secure payment by petitioner to indemnify respondent for any liability, claims, damages or losses, including attorneys’ fees, that respondent incurs as a result of petitioner’s work.
- The term of this license shall commence 15 days after petitioner has provided to respondents a copy of the insurance policy and the undertaking described above; and it is further ordered that this Court retains jurisdiction over this matter to resolve any disputes over the interpretation, implementation or enforcement of this license.
Lessons learned: In order to avoid access litigation, best practice suggests a request for permission to have access, coupled with a plan and timetable for the work and an offer to cover any incidental costs that may be incurred next door.