The City of New York, Felice Michetti, Acting Commissioner of the City of New
York Department of Housing Preservation and Development, et al., Appellants,
v. 17 Vista Associates, et al., Respondents
84 N.Y.2d 299, 642 N.E.2d 606, 618 N.Y.S.2d 249 (1994).
October 25, 1994
1 No. 164 (1994 NY Int. 162) Decided October 25, 1994
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This opinion is uncorrected and subject to revision before publication
in the New York Reports.
Elizabeth Dvorkin, for appellants.
Robert J. Ward, for respondents.
SMITH, J.:
The principal issue presented is whether a developer's promise to pay
money to a low income housing trust in exchange for an expedited and
favorable determination for construction permits by a municipality is
void as violative of public policy.
I
The Seamen's Church Institute of New York and New Jersey (the
"Institute"), a not-for-profit religious corporation, maintained
headquarters at a State Street site in New York City at which it
housed seamen who were in New York between voyages. The certificate of
occupancy described the building as a Class B multiple dwelling. The
occupancy level of the building decreased with the decline of merchant
shipping. In the 1980's, the continuing decline in occupancy, as well
as mounting operating costs, threatened the Institute's survival. It
therefore determined that it was necessary to sell the building. In
July of 1984, the Institute entered into a contract to sell the
property to the defendant 17 Vista Associates (Vista) for $29,000,000.
Vista intended to demolish the existing building and erect a high-rise
office tower. Closing was scheduled for March 4, 1985.
In late February of 1985, however, Vista informed the Institute that
it would not close on the sale because its application for a
demolition permit had been denied by the Department of Buildings. At
issue was the possible application of Local Laws, 1983, No. 19 of the
City of New York (now codified as Administrative Code of City of NY
§27-198(a)), which provided that before the Department of Buildings
could issue a permit to alter or demolish a single-room occupancy
SNIPPETS:
The City of New York, Felice Michetti, Acting Commissioner of the City of New York Department
The principal issue presented is whether a developer's promise to pay money to a low income
The certificate of occupancy described the building as a Class B multiple dwelling.
The occupancy level of the building decreased with the decline of merchant shipping.
In July of 1984, the Institute entered into a contract to sell the property to the defendant
In late February of 1985, however, Vista informed the Institute that it would not close on
At issue was the possible application of Local Laws, 1983, No. 19 of the City of New York ),
The Institute and Vista agreed to adjourn the closing pending a determination by plaintiff
After the Institute presented its case for an exemption, the City, according to Smith, "made
On the same date the contract was signed, July 24, 1985, the City, by letter from the general
The defendants refused to pay and the plaintiffs instituted this action for breach of
In their counterclaim, the defendants sought damages in the amount of $70,000,000, allegedly
The plaintiffs thereafter moved, inter alia, for summary judgment on the complaint and for
The court dismissed plaintiffs' claims against the other defendants since only Vista was a
The court denied the defendants' cross motion and dismissed their affirmative defenses and
The Appellate Division modified the Supreme Court order to deny plaintiffs' motion for
We hold that the agreement entered into between the parties, whereby the plaintiff, in
In Seawall Associates.
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