You are here: / / IN THE CONTEXT OF A LAWSUIT BY THE BOARD MEMBERS OF AN UNINCORPORATED CONDOMINIUM...
, , , ,

IN THE CONTEXT OF A LAWSUIT BY THE BOARD MEMBERS OF AN UNINCORPORATED CONDOMINIUM ASSOCIATION AGAINST THE FORMER PRESIDENT OF THE BOARD, NEITHER THE REAL PROPERTY LAW (RPL) NOR THE BUSINESS CORPORATION LAW (BCL) APPLIES TO THE FORMER PRESIDENT’S DEMAND FOR ATTORNEY’S FEES ASSOCIATED WITH DEFENDING THE ACTION; THE BY-LAWS AND THE COMMON LAW RULE THAT THE PARTIES ARE RESPONSIBLE FOR THEIR OWN ATTORNEY’S FEES CONTROL (FIRST DEPT).

The First Department, in a full-fledged opinion by Justice Gische, reversing Supreme Court, in a matter of first impression, determined the defendant, the former president of the condominium board, is not entitled to indemnification (attorney’s fees) for her costs in defending a lawsuit brought by the board of managers of the unincorporated condominium association. The lawsuit alleged defendant misappropriated the insurance proceeds paid after a fire in the condominium building. The First Department held the by-laws and the common law rule that the parties are responsible for their own attorney’s fees control. The court rejected the application of provisions of the Real Property Law (RPL) and the Business Corporation Law (BCL) with respect to indemnification in the context of an unincorporated condominium association:

Neither the common law, nor BCL § 624(e) by analogy, provide the right to recoup attorney’s fees to a board member successfully defending against a derivative action. BCL § 626(e) is not an indemnification provision. Rather, it permits legal fees to be paid to an owner who successfully asserts the interest of an entity “when the management of the entity fails to act to protect that interest” … . Consequently, “an award of attorneys’ fees in a shareholders’ derivative suit is to reimburse the plaintiff for expenses incurred on the corporation’s behalf” … . The corporation is responsible for paying the legal fees, but only where the corporation benefits from the litigation … . Neither the BCL nor the common law provide a board member with a reciprocal right to recover legal fees for defending against an unsuccessful derivative action, at least not in the absence of such authorization in the bylaws or some other statutory authority. In this respect, …

In the absence of any authority permitting [defendant] to recoup her legal fees, the general common law rule applies, that “attorney’s fees are incidents of litigation and a prevailing party may not collect them from the loser unless an award is authorized by agreement between the parties, statute or court rule” … . [Defendant], alone, is responsible for her legal fees. Board of Mgrs. of the 28 Cliff St. Condominium v Maguire, 2020 NY Slip Op 06844, First Dept 11-19-20

 

You might also like
PLAINTIFF DID NOT SUFFICIENTLY ALLEGE THAT NEW YORK’S PROPERTY TAX SYSTEM DISCRIMINATES AGAINST PROPERTY OWNERS IN “MAJORITY-MINORITY” NEIGHBORHOODS; COMPLAINT SHOULD HAVE BEEN DISMISSED IN ITS ENTIRETY (FIRST DEPT).
Question of Fact Whether Plaintiff’s Actions Were Sole Proximate Cause of His Injury
THE DENIAL OF DEFENDANT’S PETITION FOR A DE NOVO JURY TRIAL TO DETERMINE WHETHER HE IS MENTALLY ILL IS APPEALABLE AS OF RIGHT AND THE PETITION SHOULD HAVE BEEN GRANTED, AN EXCEPTION TO THE MOOTNESS DOCTRINE APPLIED AND DEFENSE COUNSEL’S STATEMENTS AND THE DEFENSE EXPERT’S TESTIMONY AT THE HEARING TO THE EFFECT DEFENDANT WAS MENTALLY ILL DID NOT CONSTITUTE A WAIVER OF THE DEFENDANT’S RIGHT TO A DE NOVO TRIAL (FIRST DEPT).
Writ of Prohibition Granted to Prevent Trial Judge from Precluding Testimony of Complainant—Complainant Would Not Release His Psychiatric Records
NYC LOCAL LAW REQUIRING DISCLOSURE ABOUT THE SELECTION PROCESS FOR CONSTRUCTION OF AFFORDABLE HOUSING IS NOT PREEMPTED BY STATE LAW AND IS NOT UNCONSTITUTIONAL.
OPENING STATEMENT ALLEGING EXCESSIVE FORCE WAS FATALLY INCONSISTENT WITH NEGLIGENCE CLAIMS, NEGLIGENCE CLAIMS PROPERLY DISMISSED ON THAT GROUND.
COMMISSIONER OF LABOR AND INDUSTRIAL BOARD OF APPEALS COULD NOT PURSUE STATE WAGE CLAIMS ON BEHALF OF CLAIMANTS WHO ARE SUBJECT TO A CLASS ACTION SETTLEMENT IN FEDERAL DISTRICT COURT IN WHICH THE STATE WAGE CLAIMS WERE RELEASED (FIRST DEPT).
Misrepresentations, Distortions, Attacks on the Court, Etc., Included in Motion Papers Warranted Sanctions Against Attorney

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

PLAINTIFF, WHO HAD PASSED OUT AT A CONCERT, REFUSED ASSISTANCE IN WALKING TO... SUMMARY JUDGMENT SHOULD NOT HAVE BEEN GRANTED TO THE CLUB AND THE SECURITY COMPANY...