295 Greenwich Court Condominium, LLC. v. Consolidated Edison Company of New York, Inc.
WHAT HAPPENED The Greenwich Court Condominium consists of two red-brick buildings at 275 and 295 Greenwich Street, built in the mid-eighties. In October 2017, NYC excavated the street for a new gas main in front of 295 Greenwich Street, at which time the Condo noticed major corrosion on the exterior of three water pipes servicing the building and steam escaping from steam mains owned by Con Edison close to the corroded pipes. It hired a contractor to make emergency repairs for $116,892. When NYC excavated the street in front of 275 Greenwich Street in January 2018, the Condo observed similar extensive corrosion under similar circumstances, i.e., escaping steam hitting the water pipes servicing 275 Greenwich. They replaced those pipes on an emergency basis as well at a cost of about $98,000.
GREENWICH COURT SUESIn May 2018, Greenwich Court sued Con Edison for negligence, alleging that the escaping steam caused the corrosion on the water pipes, and that Con Edison knew or should have known about the steam leaks and their effect on the pipes. Depositions relating to the scope and cause of the damage and the extent of the steam leaks were taken from the Managing Agent, the building superintendent, and engineers and project managers employed by Con Edison. The Condominium also engaged a metallurgist as an expert witness who opined that the escaping steam from the Con Ed mains caused the corrosion in the pipes. COUNSEL For Greenwich Court Condominium THE ABRAMSON LAW GROUP / For Defendant Con Edison In House.
CON ED DISAGREES After depositions were concluded, Con Edison made a Motion for Summary Judgment, asserting that based on the facts uncovered in the depositions, the Condominium had not met its burden of proving that Con Edison was negligent or that Con Edison had notice of damaging steam leaks. Con Ed argued that the engineers employed by Con Edison had demonstrated conclusively that the steam escaping from the Con Edison mains did not affect the Condominium’s water pipes; and since neither the Managing Agent, her supervisor nor the building superintendent were engineers, their observations and recollections had no weight.
GREENWICH COURT COUNTERS The Condominium naturally opposed the motion. To begin with, the Condominium had provided an expert witness who had stated that the steam leaks caused the corrosion, while Con Edison had provided no outside expert. According to the Condominium, the court was required to give the uncontroverted testimony of an expert witness substantial weight. Second, they asserted that Con Edison had selectively quoted from its engineers’ depositions; other deposition testimony they had given actually supported the Condo’s claim.
YOU SHOULD KNOW A party making a motion for Summary Judgment essentially claims that even viewing the evidence in a light most favorable to the non-moving party, there are no material factual issues remaining to be decided at trial, and that the court can make a legal judgment based on the evidence before it. In other words, none of the factual evidence provided by the other side is sufficient to call into question the validity of the claims made by the moving party, so no further fact-finding (at trial) is required.
THE COURT DECIDES The Court rejected Con Edison’s motion for Summary Judgment. The Court observed that Con Edison had “failed to demonstrate the absence of issues of material fact.” While Con Ed had identified potential weaknesses in the Condo’s case, it had hardly made any conclusive demonstration that it had not been negligent in the way that it maintained its steam pipes, or that the leakage did not cause the corrosion. For example, Con Ed’s engineer had stated that he had observed only “vapor” near the water service pipes, not “steam.” The Court questioned the practical difference. Furthermore, the Condominium’s opposition papers had raised triable issues of fact by its expert and its witnesses that also needed to be resolved at trial.
Con Ed actually filed a motion for reargument, which was denied. The Court stated, “the initial motion court did not overlook or misapprehend any facts or relevant law” that had been presented to it [the usual grounds to seek reargument]. “The purpose of a motion for leave to reargue is not ‘to serve as a vehicle to permit the unsuccessful party to argue once again the very questions previously decided[.]'” Notwithstanding, Con Ed has now filed a Notice of Appeal.
TAKEAWAY This case illustrates why property damage claims usually go to trial if they’re not settled. The cause and scope of damage is a factual question. The plaintiff makes fact-based arguments to show how the other party caused the damage, and the defendant makes fact-based claims why they were not responsible for the damage. Unless the court deems that one party had no legal duty (or had an unbreakable legal duty) to the other, or the evidence on one side is overwhelming, the court will usually elect to have a jury (or the court) weigh the credibility of the competing claimants at a trial, rather than making a judgment based on depositions and documents alone.
These cases can last for several years, draining the resources of a condominium or co-op and negatively affecting owners’ ability to sell or obtain mortgages in the interim. Even though many of these claims have a basis in fact, boards need to weigh the unintended consequences on the community before making them.
Case Summary and Takeaway by Kenneth R. Jacobs, Partner, Smith Buss & Jacobs
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