You are here: / / Privatization of a Mitchell-Lama Cooperative Housing Corporation Is Not...
, , , , ,

Privatization of a Mitchell-Lama Cooperative Housing Corporation Is Not a Taxable Conveyance Subject to the Real Property Transfer Tax

The Court of Appeals, in a full-fledged opinion by Judge Abdus-Salaam, determined that the reconstitution of a cooperative housing corporation [Trump Village], changing from a Mitchell-Lama corporation pursuant to the Private Housing Finance Law [PHFL] to a corporation pursuant to the Business Corporation Law, was not a conveyance of real property subject to the Real Property Transfer Tax [RPTT]. The NYC Department of Finance characterized the change as a taxable conveyance and was seeking over $21,000,000 in tax and penalties.  The Court of Appeals held that the amendment to the certificate of incorporation did not create a new corporation and that the amended certificate did not constitute a deed:

In support of their position that the privatization of Trump Village is a taxable event, defendants argue that an amendment to a certificate of incorporation is a “deed.” Defendants also assert that Trump Village is a new corporation and that there was actually a conveyance of real property to a different corporation, with Trump Village being both the grantor and grantee. However, defendants’ construction of the RPTT cannot be reconciled with the plain language of the statute. Furthermore, even if there were any ambiguities regarding the application of the RPTT to this situation, “doubts concerning [a taxing statute’s] scope and application are to be resolved in favor of the taxpayer”… . Thus, we reject defendants’ strained interpretation of section 11-2102(a) of the Administrative Code of the City of New York. …

Trump Village …, is the same corporation that was named in the original certificate of incorporation. The Business Corporation Law distinguishes between amending a certificate of incorporation (§ 801 et seq.) and formation of a corporation (§ 401 et seq.). Section 801 (14) provides that a certificate of incorporation may be amended “to strike out, change or add any provision . . . relating to the business of the corporation, its affairs, its right or powers . . . .”…

The PHFL provides that a Mitchell-Lama corporation “may be voluntarily dissolved” and “[t]hat upon dissolution, title to the project may be conveyed in fee to the owner or owners of its capital stock or to any corporation designated by it or them for that purpose, or the company may be reconstituted pursuant to appropriate laws relating to the formation and conduct of corporations”(PHFL § 35 [3][emphasis added]). Accordingly, there are two options for the process of privatization, and plaintiff chose the second option – – reconstitution through amendment of its certificate of incorporation [FN1]. Defendants posit that the legislature intended the word “reconstitute” to mean the same thing as “reincorporate.” However, as long ago as 1857, it was recognized that reincorporation “cannot be deemed the formation of a new corporation, but should be regarded as the continuation of the existing one”… . Trump Vil Section 3 v City of New York, 2014 NY Slip Op 08788, CtApp 12-17-14

 

You might also like
Discharge of Defense Attorney Was Abuse of Discretion; Issue Survives Guilty Plea 
COLLATERAL ESTOPPEL DOCTRINE DID NOT PRECLUDE TESTIMONY ABOUT DEFENDANT’S USE OF A RAZOR BLADE, DESPITE DEFENDANT’S ACQUITTAL ON THE RELATED “DANGEROUS INSTRUMENT” CHARGES IN THE FIRST TRIAL; ADVOCATE-WITNESS RULE REQUIRED THAT DEFENSE COUNSEL’S MOTION TO WITHDRAW OR HER MOTION FOR A MISTRIAL BE GRANTED.
DEFENDANT’S GUILTY PLEA WAS NOT VOLUNTARY BECAUSE HE WAS NOT INFORMED OF THE MANDATORY FINES FOR THE VEHICLE AND TRAFFIC LAW OFFENSES; AN EXCEPTION TO THE PRESERVATION REQUIREMENT APPLIED; AN APPEAL WAIVER DOES NOT PRECLUDE ARGUING THE PLEA WAS INVOLUNTARY (CT APP).
THE THIRD DEPARTMENT HAS BEEN APPLYING THE WRONG STANDARD TO THE REDUCTION OF A SENTENCE IN THE INTEREST OF JUSTICE FOR DECADES; HOWEVER, BECAUSE THE THIRD DEPARTMENT HAS RECENTLY STOPPED APPLYING THE WRONG STANDARD, THIS APPEAL IS MOOT (CT APP),
Experts’ Failure to Address Proximate Cause Precluded Summary Judgment
Reversing Its Prior Decision in this Case, the Court of Appeals Determined the “Servidone” Rule Is to Be Followed in New York/An Insurer Which Has Breached Its Duty to Defend the Insured May Rely On Policy Exclusions to Escape Its Duty to Indemnify the Insured
THE RECORD WAS INSUFFICIENT TO ALLOW THE CONCLUSION THAT DEFENDANT DID NOT RECEIVE EFFECTIVE ASSISTANCE OF COUNSEL, A POST-TRIAL EVIDENTIARY PROCEEDING MIGHT ANSWER THE QUESTIONS LEFT OPEN BY THE TRIAL RECORD; ANY ERROR IN ADMITTING DNA EVIDENCE WHERE CONSENT, NOT IDENTITY, IS THE ISSUE IS HARMLESS (CT APP).
Recklessness Demonstrated In Operation of Vehicle

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy

Sex Offender Who Has Difficulty Controlling Sexual Urges, As Opposed to a Sex... Motion for a Change of Venue Made in the Wrong County–Statutory Procedure...