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How the Kasowitz Decision Puts Attorney Fee Provisions in Proprietary Leases on Shaky Ground
A bedrock of living in a New York City co-op has been the notion that a tenant/shareholder who breaches their proprietary lease or drags their building into expensive and protracted litigation will be responsible for reimbursing the co-op corporation for the expenses incurred as a result of the breach, including the corporation’s reasonable attorneys’ fees. Indeed, over the years, recalcitrant shareholders have been required to reimburse their co-ops hundreds of thousands of dollars in legal fees due to their failure to abide by their contractual obligations and, in some instances, acting as “litigation terrorists.”
The obligation to reimburse the “Lessor’s expenses” is contained in all proprietary leases and trumps the general concept in American jurisprudence that the parties to a dispute each bear the burden of paying their own legal fees. However, a recent decision from the Appellate Division, First Department (which has jurisdiction over Manhattan and the Bronx), has thrown this well-established concept into flux.
In Kasowitz, Benson, Torres & Friedman, LLP v. JPMorgan Chase Bank, N.A. (2025 NY Slip Op 00396), a unanimous panel of four judges invalidated the attorney fee provision in The Dakota’s proprietary lease because it permitted the co-op to recover its attorneys’ fees in connection with a shareholder dispute regardless of whether the shareholder was in default or whether the co-op’s claim was meritorious.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.
The Stranger to the Deed Rule
In 1987, a unanimous Court of Appeals reaffirmed the vitality of the "stranger to the deed" rule, which holds that if a grantor executes a deed to a grantee purporting to create an easement in a third party, the easement is invalid. Daniello v. Wagner, decided by the Second Department on November 29th, makes it clear that not all grantors (or their lawyers) have received the Court of Appeals' message, suggesting that the rule needs re-examination.