HABITAT Magazine
A messy and complicated dispute between a condo board and its commercial unit-owner has landed the parties in court while highlighting the importance of reaching an alteration agreement before work begins.
The dispute is between the condo board and the commercial unit-owner at 1055 Madison Ave., a 27-story, postwar building with a distinctive double-height base level clad in granite. This ground floor level contains, among other things, the building’s residential lobby and a single commercial unit.
The commercial unit-owner proposed subdividing the commercial unit into three different retail spaces. In order to do so, the unit-owner had proposed punching additional shop windows through the granite facade near the corner, disassembling a mezzanine level and catwalks used to access certain building pipes and valves located in the ceiling above the commercial unit’s 20-foot high interior space, and drilling anchorages into the granite facade to hang new signage for the prospective new retail tenants.
The parties engaged in lengthy negotiations over an alteration agreement but could not come to terms. Undeterred, the commercial unit-owner went ahead and did all of the work contemplated by the unsigned alteration agreement anyway.
Bring in the lawyers. The board sued, and a lower court issued a decision that denied most of the relief sought by both parties. Even though it agreed that the board had an easement to access the building pipes and valves, the court denied the request for relief ostensibly because the board had a contractual remedy to restore access. With respect to the exterior windows and signage, again the court denied relief even though it conceded that the unit-owner had installed the windows and sign without permission. The ruling stated that the unit-owner would suffer a “hardship” if its improperly installed windows and signage were removed.
On appeal, the Appellate Division, First Department found that the board should have been granted a declaratory judgment that the unit-owner had no authority to alter the exterior facade or demolish the mezzanine and catwalks without board permission, noting that a showing of “irreparable harm” is not a predicate for granting relief. On the other hand, the court largely refused to disturb the lower court’s decision denying injunctive relief to the board, finding that requiring the unit-owner to restore the catwalks and removing the signs would be “extremely costly” and “disruptive to defendant’s tenants,” even though the board had produced expert testimony that the lack of immediate access to the building pipes constituted a continuing violation of the Building Code.
It is unclear from the decision how the board’s easement to access building pipes and valves will be restored. In addition to being a regulatory requirement, this is clearly a safety issue, and it will be imperative for the board to exercise its contractual right and fiduciary obligation to enter the commercial space and restore that access as soon as possible. Unless the parties are somehow able to negotiate a settlement, it seems inevitable that as soon as the board’s contractors arrive to restore the catwalks, the parties will be back in court.
The moral of this ongoing legal saga is clear: come to an alteration agreement before the alterations begin.
This is a lightly edited version of an article that appears in the March 2026 Condo/Co-op Digest prepared by the law firm Moritt Hock & Hamroff.