Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

New York Real Estate Law ReporterFeaturesContractsLandlord Tenant Law

'Huguenot LLC v. Megalith Capital Group Fund I, L.P.': A Tutorial On Contract Liability for Real Estate Purchasers

By William J. Geller and Robert J. Braverman
October 01, 2024

In June 2024, the First Department decided Huguenot LLC v. Megalith Capital Group Fund I, L.P., 228 A.D.3d 404 (1st Dept. 2024), which resolved a question of liability for a group of condominium apartment buyers and in so doing, touched on a wide range of issues about how contracts can obligate purchasers of real property. In ultimately rejecting the plaintiff's claim that the apartment buyers could be responsible for the condominium developer's breach of a contract recorded as part of the condominium's declaration, the court illustrated some important points about how contracts can run with the land, or otherwise impose liability on real estate buyers.

Factual Background

The plaintiff was the original owner of a building in lower Manhattan, and entered into a contract under which the developer would renovate the building and then divide and sell the upper floors as condominium apartments, while the plaintiff would retain ownership of the storefront on the ground floor as a commercial unit. After the plaintiff and the developer recorded a condominium declaration dividing the building up into two condominium units, the ground floor commercial unit and "Unit 2" which would later be subdivided into residential apartments, they entered into a contract amendment (the Recorded Contract) which set forth the requirements for the construction work the developer would do in the commercial unit and provided that it could be recorded as part of the condominium's declaration. In recording the Recorded Contract as part of the declaration, the plaintiff specified that the defined term for the developer in the Recorded Contract "shall mean and refer to" a term that included owners of the apartments that Unit 2 would be subdivided into. Later, the developer recorded a declaration amendment splitting Unit 2 into individual apartments and stating that the construction work had been completed.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
Bankruptcy Sales: Finding a Diamond In the Rough Image

There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.

Judge Rules Shaquille O'Neal Will Face Securities Lawsuit for Promotion, Sale of NFTs Image

A federal district court in Miami, FL, has ruled that former National Basketball Association star Shaquille O'Neal will have to face a lawsuit over his promotion of unregistered securities in the form of cryptocurrency tokens and that he was a "seller" of these unregistered securities.

Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It Image

Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?

Blockchain Domains: New Developments for Brand Owners Image

Blockchain domain names offer decentralized alternatives to traditional DNS-based domain names, promising enhanced security, privacy and censorship resistance. However, these benefits come with significant challenges, particularly for brand owners seeking to protect their trademarks in these new digital spaces.

Coverage Issues Stemming from Dry Cleaner Contamination Suits Image

In recent years, there has been a growing number of dry cleaners claiming to be "organic," "green," or "eco-friendly." While that may be true with respect to some, many dry cleaners continue to use a cleaning method involving the use of a solvent called perchloroethylene, commonly known as perc. And, there seems to be an increasing number of lawsuits stemming from environmental problems associated with historic dry cleaning operations utilizing this chemical.