No Party For The Party Wall [Habitat Magazine]

Scott Pashman discusses Bayou v. 351 Owners Corp. in Habitat Magazine's Case Watch series. 351 West 20^th Street, a Chelsea neighborhood co-op, shares a party wall with its neighbor, 353 West 20^th Street. When 353 planned major renovations, including cellar expansion, the work risked damaging the co-op's structure unless protective measures were taken. To prevent this, 353 proposed underpinning both the shared party wall and an independent wall on the co-op's property. Negotiations over a license agreement stalled, largely due to the co-op's concerns about losing property insurance or facing higher premiums. As a result, the Department of Buildings issued a stop-work order, and 353 sued to either gain permission to underpin or compel the co-op to perform the work.

The court ruled in favor of the co-op, finding that 353 could not underpin without consent because the work would cross the property line, constituting trespass. The judge rejected claims that a shared party wall grants rights to make permanent structural changes or that the co-op was legally obligated to allow or perform underpinning. While the co-op has no duty to grant access, the court noted that efforts to protect property could affect future damage claims. Although summary judgment was denied, the case continues on claims for damages. Looking ahead, a pending amendment to New York's Real Property Actions and Proceedings Law Section 881 could allow courts to grant developers permission for permanent encroachments like underpinning, shifting the balance toward developers. This case underscores the importance of negotiating strong license agreements that address risks such as insurance, monitoring, and security, and include provisions for fees, escrow, and damage procedures.

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