Adverse Possession | Down Payment | Subpoenas Quashed

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Nonprofit Community Garden Owns Manhattan Lot Through Adverse Possession

Nonprofit Community Garden Owns Manh attan Lot Through Adverse Possession

In Children’s Magical Garden Inc. v. Norfolk St. Dev.LLC, the plaintiff nonprofit Children’s Magical Garden, Inc. (the “Garden”), is a community garden founded by its members in 1985 on three lots in Manhattan’s Lower East Side. The defendants are allegedly one of those lot’s record owners. Challenging their application to build on that lot, the plaintiff sought a declaration that it owned the lot by adverse possession. Adverse possession is a process by which real property can change ownership. It is governed by statute. By adverse possession, title to another’s real property can be acquired without compensation, by holding the property in a manner that conflicts with the record owner’s rights for a specified period.

On appeal, the Appellate Division, First Department, affirmed the Supreme Court’s finding, that the plaintiff adequately asserted a claim of right to Lot 19 under adverse possession.

As the Appellate Court framed it, the appeal involved “what must be an extremely rare occurrence in Manhattan, to wit, a claim of adverse possession of prime real estate located in the Lower East Side neighborhood of Manhattan. Specifically, we are presented with a dispute over a vacant corner lot located at 157 Norfolk Street at its intersection with Stanton Street, one block south of East Houston Street in lower Manhattan. Plaintiff Garden, a not-for-profit corporation incorporated in 2012, is a community garden founded by its members in 1985 on Lots 16, 18, and 19 in Block 154. The Garden was founded by activists outraged by the accumulation of garbage and used needles on the lots located across the street from an elementary school.”

The defendants Norfolk Street Development, LLC, S & H Equities (NY), Inc., and Serge Hoyda are alleged to have been the record owners of Lot 19 during the prescriptive period. The defendant 157, LLC is alleged to have purchased the property from Norfolk Street Development on or about January 6, 2014.

In order to establish a claim of adverse possession, the Appellate Court explained that a plaintiff must prove the possession was: (1) hostile and under a claim of right; (2) actual; (3) open and notorious; (4) exclusive; and (5) continuous throughout the 10-year statutory period. “In addition, where, as here, the claim of right is not founded upon a written instrument, the party asserting title by adverse possession must establish that the land was ‘usually cultivated or improved’” or that the land “has been protected by a substantial enclosure” (see former RPAPL 522; Estate of Becker v. Murtagh, 19 NY3d 75, 81 [2012]).

According to the Court, the central issue presented by the appeal was whether the plaintiff had stated a claim for adverse possession of Lot 19 by sufficiently pleading the “continuous possession element.”

The complaint alleged that more than 30 years ago, in 1985, the Garden was founded by community activists who sought to improve their neighborhood. Because crime plagued the neighborhood at that time, and used needles and piles of garbage littered the abandoned corner lot in question — across the street from elementary school P.S. 20 — these neighborhood activists decided to build what plaintiff describes is now a “neighborhood icon,” and that the defendants and their predecessors “abandoned Lot 19” as a “shameful eyesore” and that the plaintiff and its members took possession and “by their tremendous efforts transformed the Premises into a vibrant community garden where generations of children have thrived.” The Garden included a fish pond, playground equipment, a stage, trees and plants and was fenced off with access to its members only.

The defendants had argued the “plaintiff failed to plead sufficient facts evidencing continuous possession by its predecessor members for the statutory period, through an unbroken chain of privity, by tacking periods between anonymous possessors who are not alleged to have intended to transfer title to the incorporating members.” This argument was based on the fact that the plaintiff was incorporated in 2012 and the defendants’ contention that there is no allegation that plaintiff had the necessary “privity” with the Garden members prior to incorporation.

In rejecting this argument, the Appellate Court held that it is “well settled that an unincorporated association may adversely possess property and later incorporate and take title to it because ’although the unincorporated society could not acquire title by adverse possession, its officers could for its benefit, and when the corporation is duly organized the prior possession may be tacked to its own to establish its title under the statute of limitations.’”

Buyers Fail to Timely Cancel Contract and Denied Down Payment Refund

Buyers Fail to Timely Cancel Cont ract and Denied Down Payment Refund

In Sanjana v. King, the plaintiffs-buyers sued for summary judgment in an action arising from a failed condo sale with defendants-sellers. The contract contained a standard mortgage contingency clause and allowed the plaintiffs to cancel if they were unable to secure a commitment, but it required them to notify the sellers within five business days after the commitment date or they waived their right to cancel and receive their down payment refund.

The plaintiffs were conditionally approved for a mortgage, but later denied after their time to cancel expired. Their counsel notified the sellers the mortgage approval was revoked and requested the return of the $110,000 down payment. The sellers denied the request because the buyers failed to give the required notice and the buyers sued the sellers for the refund.

The Court found the buyers never obtained a mortgage commitment under the contract, only a preliminary approval, and in lieu of notifying the sellers, or seeking to extend their time to cancel, did nothing until their time to cancel expired and their conditional approval was revoked. It granted the sellers’ cross-motion for summary judgment dismissing the complaint as the buyers neither obtained a mortgage commitment, nor timely canceled the contract.

In granting summary judgment to the sellers, the Court reasoned that “any consideration of whether the conditional approval constitutes a commitment must begin with the definition of a mortgage commitment. ‘According the term mortgage commitment its ordinary dictionary meaning, a formal written communication setting forth the terms and conditions of the mortgage loan was required to satisfy the mortgage contingency clause’ At least one Court has held under similar circumstances that a conditional mortgage commitment letter is not a mortgage commitment”

The Court found that the initial letter granting the conditional approval identified 18 separate items the buyers were required to send in, and emphasized that “[o]nce we receive the items from you and the third parties, we will conduct a final review of the loan documents. As soon as we complete the review and issue a final approval, we will contact you to coordinate closing.” The second letter denying financing stated that “[w]e are unable to offer you financing at this time.” Under these circumstances, the Court found that the buyers never obtained a mortgage commitment pursuant to the terms of the contract. “Plaintiffs only received a letter from a lender offering preliminary approval and detailing the steps that were required in order to receive a commitment. There is no logical way to construe the initial letter from Quicken Loans as a written commitment pursuant to the contract.”

The Court noted that “while losing the entire downpayment might be a harsh outcome, this Court cannot rewrite a term of a contract signed by the parties. The parties agreed that plaintiffs would not be obligated to purchase and would get their downpayment back if they failed to get a mortgage commitment as long as they gave the sellers notice within five days of the commitment date. Otherwise, if plaintiffs did not timely exercise their option to cancel, then plaintiffs waived the contingency and were obligated to purchase with or without a mortgage. It is undisputed that they did not exercise their right to cancel. Plaintiffs chose to take a risk that Quicken Loans would agree to finance their purchase of the apartment. When the purchasers failed to close, the contract gives the sellers the right to keep the downpayment.”

FOX’s Subpoenas Regarding Plaintiff’s Past Sexual Relationships with Other Men Quashed

FOX’s Subpoenas Regarding Plaintiff’s Past Se xual Relationships with Other Men Quashed

In Hughes v. Twenty–First Century Fox, Inc., a female guest television contributor brought a federal action against the mass media corporation, its television news channel, a news anchor, its general counsel, and the head of corporate communications, alleging gender discrimination and retaliation under Title VII, New York State Human Rights Law, and New
York City Human Rights Law, defamation, and violation of New York City Gender-Motivated Violence Act. In a recent decision, the federal court addressed the television contributor’s motion to quash non-party subpoenas.

According to the decision, plaintiff Scottie Nell Hughes moved to quash four non-party subpoenas. The subpoenas were served on men formerly involved in affairs with her. The subpoenas sought sexual or romantic communications between Hughes and each of the men, information regarding her personal background and reputation, and media files of a sexual or romantic nature depicting Hughes.

Hughes moved to quash these subpoenas on the ground that none of subpoenaed parties was ever a Fox employee or a contributor on Fox programs with Hughes, and therefore has no information bearing on Hughes’ claims against the defendants. She also claimed that the subpoenas were issued to “shame and harass her.”

In response, the defendants argued that these subpoenas were designed to elicit information relevant to their defenses. As the Court explained: “First, Defendants maintain that evidence of Hughes’ extramarital sexual relationships will undermine her claim that Defendants’ statement to the National Enquirer—and its effect of characterizing her as sexually immoral—was false. Second, Defendants contend that information obtained from these men will establish a pattern of Hughes pursuing conservative media figures and politicians who she believed could advance her career. This defense would essentially counter Hughes’ claim that she was coerced into a sexual relationship with Payne.

In addressing the motion, the Court recognized that parties to an action generally do not have standing to object to subpoenas issued to non-party witnesses. However, “exceptions are made for parties who have a claim of some personal right or privilege with regard to the documents sought. Examples of such personal rights or privileges include the personal privacy right and privilege with respect to the information contained in psychiatric and mental health records, claims of attorney-client privilege, and other privacy interests, including those relating to salary information and personnel records. An individual’s sexual history with other men, especially the lurid details of their relationships and media files depicting their activities, is clearly a personal matter in which Hughes possesses a privacy interest. Therefore, as a threshold matter, this Court concludes that Hughes has standing to object to the non-party subpoenas.”

The Court framed the “relevant question” as “whether the four non-parties have information demonstrating that Hughes was a serial seductress who engaged in a pattern of pursuing relationships with men—like Charles Payne—for the purpose of advancing her career. To substantiate their position, defendants submitted third party affidavits attesting to Hughes’ sexual proclivities with these men.”

The Court found that “injecting this case with Hughes’ rendezvous with non-parties who have no connection to the subject matter of this litigation will only detract the parties—and later, a jury—from the real issues underlying Hughes’ grievance. Defendants’ purported strategy is superficially appealing, but advances a boorish, reductive narrative that Hughes was predisposed to engaging in self-serving sexual relationships. Hughes’ prior sexual history has no relevance to her claims against Payne, or the defense that she used Payne to advance her career at Fox.”

It further reasoned that “if Defendants seek to raise the defense that Hughes used Payne to advance herself at Fox, they need only seek discovery from Hughes, Payne, and others at Fox. The prejudice arising from Hughes’ prior sexual history with other men would outweigh what little relevance it may bring to this case. To the extent Defendants seek to draw on Hughes’ reputation for engaging in self-aggrandizing conduct with other men, they may directly depose Hughes, who has ‘acknowledged in a cover story interview with her home town paper’ that rumors of such conduct ‘have long dogged her career.’”

The Court granted Hughes’ motion to quash the defendants’ non-party subpoenas because the prejudice arising from her sexual history would outweigh what little relevance it could bring to the case.

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