This action arises from a dispute between a residential condominium unit-owner, plaintiff Stillpoint Meadows PH-62, LLC, and the condominium board, defendant Residential Board of Managers of the 62 Cooper Square Condominium (Board). The parties dispute responsibility for paying costs incurred for removal and reinstallation of rooftop-terrace paving stones, undertaken by the condominium in connection with replacing the building's roof.

The Board has taken the position that the bylaws require plaintiff to pay this paver-related charge, because the costs at issue relate to removal/reinstallation of pavers on plaintiff's private rooftop terrace, in particular. And the Board assessed plaintiff substantial late fees and interest after it refused to pay the charge. Plaintiff's view is that under the condominium bylaws, this charge is the responsibility of the residential unit owners collectively; and that the Board only assessed the charge against plaintiff out of a vindictive desire to retaliate against plaintiff for the position it took in an unrelated disagreement over rooftop access.

Plaintiff brought this action against the 62 Cooper Square Condominium, the Board, and several individual defendants who were the Board members who voted to assess the paver-replacement charge against plaintiff, in particular. Plaintiff is asserting (i) a claim for breach of fiduciary duty against the Board and the individual Board members; (ii) a request for a declaration that assessment against plaintiff of the paver-replacement charge and late fees/interest was improper; and (iii) a request for a permanent injunction requiring the Board to comply with its obligation under Business Corporation Law (BCL) § 727 to issue an annual statement disclosing contracts entered into by the Board in which one or more Board members has an interest.

After plaintiff amended its complaint, defendants brought this motion to dismiss. The motion is granted with respect to plaintiff's first and third causes of action; and granted in part and denied in part with respect to the second cause of action.

Defendants contend that plaintiff's claims against the Board and its members for breach of fiduciary duty, and its associated request for declaratory relief, are subject to dismissal as time-barred. They argue first that these claims were required to have been commenced within four months of their accrual under CPLR 217, but were not brought until several years later. Alternatively, they argue, if this court were to conclude that the claims are subject instead to the three-year limitations period governing fiduciary-duty claims, the claims would still be untimely because they accrued in 2017 and were not sued on until 2022. These arguments are considered in turn. Neither is persuasive.

A. Whether Plaintiff's Fiduciary-Duty and Declaratory-Judgment Claims Against the Board and its Members are Subject to a Four-Month Statute of Limitations

Defendants claim that "[i]t is well-settled that decisions made by a condominium's board are to be challenged by the special proceeding provision of [CPLR] Article 78." (NYSCEF No. 29 at 9.) Therefore, they say, challenges to board determinations, like the one at issue here, must be made within CPLR 217's four-month limitations period for article 78 proceedings. (NYSCEF No. 29 at 9.) It is true that, as defendants contend, a claim will be subject to article 78's four-month limitations period when the basis of the claim, and the request for relief, may be resolved fully through an article 78 proceeding. (See Frontier Ins. Co. v State, 87 NY2d 864, 868 [1995]; Hughey v Metropolitan Transp. Auth., 159 AD3d 596, 597 [1st Dept 2018].) But the court disagrees with defendants' premise that plaintiff here could have pursued their fiduciary-duty claims through article 78.

As an initial matter, it is not well-settled, as defendants would have it, that condominium-board determinations may be challenged through a CPLR article 78 proceeding.^[FN1] To the contrary, [*2]this court is not aware of any appellate precedent considering whether a party may bring an article 78 proceeding of that sort against a condominium board.^[FN2] At most, the Appellate Division has, on at least two occasions, resolved the merits of article 78 proceedings challenging condominium-board determinations. (See e.g. Seligson v Board of Managers of 25 Charles St. Condominium, 138 AD3d 432, 432-433 [1st Dept 2016] [affirming board determination]; Matter of Vacca v Board of Managers of Primrose Lane Condominium, 251 AD2d 674, 674 [2d Dept 1998] [rejecting board determination].) In those proceedings, though, the parties did not raise, and the court did not address, whether relief was available under article 78 against those defendants in the first place.^[FN3]

Considering the matter for itself, this court concludes that article 78 is available to challenge a condominium-board decision only when the condominium is incorporated. Article 78 proceedings may be brought against a "body" or "officer." (CPLR 7802.) A condominium, however, is usually an unincorporated association. (See Brasseur, 21 AD3d at 297.) And the nature of "[a] voluntary, unincorporated association . . . is not [that of] a body or officer against whom an Article 78 proceeding can be maintained." (Ivey v Coughlin, 111 AD2d 648, 648 [1st Dept 1985] [considering article 78 proceeding brought against a union in the nature of mandamus to compel].) This is because private unincorporated associations are not '"beholden to the [s]tate for their franchise or charter or the exercise of their functions."' (Matter of American University of Antigua v CGFNS Intern., 126 AD3d 1146, 1148 [3d Dept 2015], quoting Weidenfeld v Keppler, 84 AD 235, 238-239 [1st Dept 1903], affd 176 NY 562 [1903].) As a result, they do not qualify as the kind of "quasi-governmental bodies" that are also subject to article 78, in addition to the more conventional article 78 claims brought against governmental bodies or officers. (Id.)

If a condominium were incorporated, as sometimes occurs, a different result would obtain. But the condominium declaration in this case, as amended, reflects that 62 Cooper Square Condominium is an unincorporated association. (See NYSCEF No. 36 at 53, 63, 70, 80.) The determinations of this unincorporated condominium's Board may not be challenged through CPLR article 78. As a result, CPLR 217 does not apply.

B. Whether Plaintiff's Fiduciary-Duty and Declaratory-Judgment Claims Accrued in 2017 or in 2019

Defendants argue, in the alternative, that plaintiff's cause of action for breach of fiduciary duty, and its associated request for a declaratory judgment, are also untimely under the three-year limitations period applicable to fiduciary-duty claims that seek primarily monetary relief. (See NYSCEF No. 29 at 10-11 [mem. of law]; IDT Corp. v Morgan Stanley Dean Witter & Co., 12 NY3d 132, 139 [2009] [discussing fiduciary-duty limitations periods].) Defendants assert that the statute of limitations for these claims "began to run in March 2017 when the LLC was notified that it would be charged." (NYSCEF No. 29 at 11.) Plaintiff, on the other hand, argues that the claims accrued for limitations purposes in 2019, when plaintiff was first invoiced for the roof-related charges. (See NYSCEF No. 40 at 14.) This court agrees with plaintiff.

As plaintiff contends, because damages are an element of a fiduciary-duty claim (see Armentaro v Paraco Gas Corp., 90 AD3d 683, 684 [2d Dept 2011]), the claim "is not enforceable"—and therefore does not accrue—"until damages are sustained." (IDT Corp., 12 NY3d at 140 [internal quotation marks omitted].) Here, defendants' contractor did not invoice defendants for the replacement of plaintiff's terrace pavers until February 15, 2019 (see NYSCEF No. 34); and the amended complaint alleges that plaintiff was not invoiced, in turn, until April 2019 (see NYSCEF No. 22 at ¶ 28). Plaintiff commenced this action on February 9, 2022 (see NYSCEF No. 1), within three years of accrual. The fiduciary-duty cause of action is thus timely.^[FN4] For the same reasons, defendants' limitations-related argument with respect to plaintiff's associated declaratory-judgment claim fails as well.^[FN5]

Plaintiff's first cause of action seeks damages against the Board, as an entity, and the members of the Board, individually, for breach of fiduciary duty. Plaintiff's second cause of action seeks a declaration in its favor with respect to the paver-replacement charge and the associated late fees and interest. In addition to raising the limitations-based defenses to these claims discussed above, defendants also argue that they fail on the merits. This court largely—but not entirely—agrees.

A. Plaintiff's Claim against the Condominium Board for Breach of Fiduciary Duty

Plaintiff contends that the Board owes it a fiduciary duty; and that the Board breached this duty by (i) assessing it a paver-replacement charge (and late fees) contrary to the by-laws, as (ii) a pretext for a vendetta by the Board against plaintiff arising from an unrelated dispute between them. In moving to dismiss, defendants argue, in essence, that none of these contentions support a cause of action against the Board. Defendants' argument is persuasive.

1. Whether the Board owes plaintiff a fiduciary duty

With respect to the existence of a fiduciary duty, the parties do not provide any appellate precedent considering whether or not a unit-owner-selected condominium board, as an entity, owes a fiduciary duty to the unit owners.^[FN6] Rather, the parties rely on (i) appellate precedents involving the boards of residential cooperative corporations (or similar entities such as incorporated homeowners' associations), or (ii) cases involving breach-of-fiduciary-duty claims in which the parties did not dispute, and the court did not address, whether a duty exists in the first place. And this court's research has not found appellate decisions considering this particular issue, either.

Although the existence of this gap in New York's condominium caselaw is somewhat surprising, this court need not pursue the matter further here. Even assuming that the Board, as a board, does owe plaintiff a fiduciary duty, plaintiff has not sufficiently alleged that the Board breached that duty in this case.

2. Whether plaintiff has alleged a breach of fiduciary duty

a. Whether the bylaws make plaintiff responsible for the paver-replacement charge

As noted above, in disputing the issue of breach, the parties contest whether the condominium bylaws make plaintiff alone responsible for the paver-replacement charge, or provide that this charge must be borne by all the residential unit owners. This court concludes that the bylaws put responsibility for the charge on plaintiff.

The parties each cite numerous provisions of the declaration and bylaws. But the most relevant governing language appears in two sections of the bylaws: Sections 6.1.2 and 6.9.2.2. (See NYSCEF No. 35 at 25, 34 [PDF pagination].) Defendants emphasize § 6.1.2. This term of the bylaws provides that if a residential limited common element "benefits only certain Residential Unit Owners, then the costs of alteration, addition, repair, replacement and restoration thereto . . . shall be borne solely" by the unit owners who benefit from that limited common element.^[FN7] (NYSCEF No. 35 at 25.) This section further provides that, except as otherwise provided in the bylaws, the particular unit owners benefitting from this type of limited common element "shall be responsible for the normal operation, maintenance and repair" of the limited common element "at their sole cost and expense." (Id.)

Plaintiff, on the other hand, leans heavily on the portion of § 6.9.2.2 governing maintenance and repair of terraces, in particular. This section provides that "[a]ll normal maintenance, repairs and replacements of any Terrace shall be made by the Residential Unit Owner having access to such Terrace at such Unit Owner's own cost and expense." (NYSCEF No. 35 at 34.) On the other hand, any structural or extraordinary repairs or replacements to such Terrace," including leaks not stemming from unit-owner negligence, "shall be made by the Residential Board and the cost and expense thereof shall be charged" to all residential unit owners as a common expense. (NYSCEF No. 35 at 34.)

An obvious tension exists between these two provisions, given that the penthouse units' private roof terraces (including the terraces at issue here) constitute residential limited common elements. Defendants do not address this issue. Plaintiff suggests that § 6.9.2.2, as the more specific of the two applicable provisions, should be treated as controlling for present purposes. (See NYSCEF No. 20-21.) This suggestion makes sense. But this court is not persuaded that § 6.9.2.2 supports plaintiff's position with respect to the paver-replacement charge at issue. In particular, the nature of the repair/replacement work for which plaintiff is being charged, and the circumstances under which that work occurred, lead this court to the conclusion that the work is "normal" rather than "structural or extraordinary."

The work itself consisted of removing lightweight concrete paving stones (each eighteen inches square) from plaintiff's terrace, the storage of those stones for the duration of the roof replacement, and the reinstallation of the paving stones to the terrace thereafter. (See NYSCEF No. 22 at ¶¶ 8, 26 [amended complaint].) This work, as distinct from the roof replacement itself, does not affect or alter the structure of the terrace. Nor is removing and replacing paving stones extraordinary in terms of its extent or invasiveness with respect to the terrace—in contrast, for instance, to the work that might be needed to address water infiltration (the example given in § 6.9.2.2).

The allegations of plaintiff's amended complaint also indicate that this work was not "extraordinary" in the sense of unusual or unanticipated. Plaintiff alleges that the paving stones on plaintiff's roof terraces—and on the building-wide common roof terrace—were "installed as [*4]part of the Building's construction." (NYSCEF No. 22 at ¶ 8.) Plaintiff further alleges that the roof replacement entailing the removal and replacement of these paving stones was prompted by the Board's "determin[ation] that the [building's] Membrane Roof had reached the end of its useful life" (id. at ¶ 9). In other words, the paving-related work occurred in, and resulted from, the ordinary course of building wear and tear. Relatedly, it would have been understood and anticipated from the time of the building's construction that the building owner or manager would need at some point in the future to remove the paving stones from the roof in order to replace the membrane underneath when the membrane wore out. These maintenance/repair measures would be undertaken only infrequently, to be sure. But "infrequent" is not necessarily the same as "extraordinary."

Thus, to the extent that the specific terrace-related language in § 6.9.2.2 of the bylaws departs from the general rule in § 6.1.2 that individual unit owners must cover repair costs for limited common elements that benefit only them, that language does not avail plaintiff here. Plaintiff has not established for pleading purposes that the Board's assessment against plaintiff of the costs of removing and reinstalling paving stones on plaintiff's private roof terrace was contrary to the condominium bylaws.

b. Whether the Board's assessment of the paver-replacement charge was pretextual

Although not put in precisely these terms, this court understands plaintiff also to be suggesting that the assessment of the paver-replacement charge was a pretext for the Board's pursuit of its alleged vendetta against plaintiff. This court's conclusion that making plaintiff responsible for the charge is permitted under the bylaws does not necessarily rule out a claim for breach of fiduciary duty, should plaintiff sufficiently allege that the charge was imposed on it out of impermissible retaliatory motives. (See Graham v 420 E. 72nd Tenants Corp., 168 AD3d 568, 568 [1st Dept 2019] [holding that evidence that a cooperative board acted in "bad faith and for purposes of retaliation" is sufficient to support a claim against the board for breach of fiduciary duty].) But the court is not persuaded that plaintiff's allegations on this point are sufficient.

1. Plaintiff's amended complaint reflects that the Board's formal position from the outset was that plaintiff was responsible for the paver-replacement charge. (See NYSCEF No. 22 at ¶¶ 10-13.) That is, as of early 2017 the Board had already concluded, and told plaintiff, that the paver-replacement charge would be plaintiff's responsibility—before the separate dispute between plaintiff and the Board arose over roof access (see NYSCEF No. 22 at ¶¶ 21-25). That sequence of events undermines plaintiff's allegations of retaliatory motive.

2. Plaintiff relies on two other allegations to show that the Board shifted position with respect to the paver-replacement charge. First, plaintiff alleges that after plaintiff and the Board exchanged letters about which unit owner(s) should have to pay that charge, the condominium's managing agent "informed plaintiff's counsel that the Condominium was going to be responsible for removal of restoration of the Pavers for the Membrane Roof work." (Id. at ¶ 16.) But the word "responsible" in this allegation is ambiguous on a crucial point: whether the managing agent meant that the condominium would be responsible for doing the work, or that it would be responsible for paying for the work.^[FN8] And plaintiff has not provided quotations (or documentary [*5]evidence) that might dispel this ambiguity.

Second, plaintiff alleges that the condominium's financial statements for 2017 and 2018 "disclosed that the costs for the Membrane Roof work (which included removal, storage and reinstallation of the Pavers on Plaintiff's Terraces) was an expense of the Condominium," charged to all residential unit owners. (Id. at ¶ 19.) Plaintiff does not also allege or argue, however, that describing the full cost of the roof replacement as a condominium expense on the building's financial statement would, under the condominium's bylaws or usual practices, constitute a binding determination or representation by the Board that the condominium (and therefore the residential unit owners) was responsible for that full cost.

If, for example, the financial statements were instead intended to reflect the status of the condominium's financial obligations as of the time the statements were prepared—i.e., before the Board had recouped (or sought to recoup) the paver-related charges from plaintiff—inclusion of the paver-replacement charge as a condominium expense would not reflect a concession by the Board that the charge should be assessed against all unit owners. Plaintiff's pleadings and motion papers do not address this point. At most, plaintiff alleges that the financial statements "did not include any amount that was, or would be, due to the Condominium from the plaintiff for reimbursement" of the paver-related charge. (NYSCEF No. 22 at 19.) But plaintiff does not represent in the amended complaint (or argue on this motion) that under the applicable accounting rules (or the Board's usual practices), the financial statements would have broken out that charge as an expense to be recouped from plaintiff, had the Board viewed plaintiff as responsible for the charge.^[FN9]

3. Plaintiff thus has not established that the Board's position on financial responsibility for the paver-related charge changed between February 2017 and February 2019. Further, plaintiff has no specific allegations to support its claims of retaliatory motive. At most, plaintiff says that in January 2019, "[t]he Board members were incensed by plaintiff's refusal to go forward" with discussions relating to roof access, and that as a result, they "vindictively, arbitrarily and capriciously decid[ed] to retroactively back-charge plaintiff" for the paver-related charge. (Id. at ¶ 26.) The amended complaint leaves it entirely unclear, though, what the basis is for its allegation about the state of mind of the Board members: whether, for example, that allegation was based on first-hand knowledge or merely on the asserted coincidence in timing. And the complaint does not provide any details that might explain or support this state-of-mind allegation—as one would expect, given that the Board members' alleged anger and vindictiveness is the heart of this entire action.

4. The only other retaliation-related allegation is that the Board "also authorized and directed the Managing Agent of the Condominium to bill late fees to the plaintiff for the [*6]nonpayment" of the paver-related charge, initially at $100 per month and then increased to $1,000 per month. (Id. at ¶ 30.) Plaintiff does not, however, allege or argue that (i) the condominium bylaws left to the Board's discretion the amount of late fees to assess for unpaid common charges; or (ii) the amount of the late fees assessed here (whether mandatory or discretionary) contravened the bylaws.^[FN10]

The court is not persuaded, on the facts as alleged, that plaintiff has established for pleading purposes that the Board's decision, consistent with the bylaws, to charge plaintiff for the paver-replacement work, could constitute a breach of fiduciary duty because the decision was made out of retaliatory motives.

B. Plaintiff's Claim against the Board Members for Breach of Fiduciary Duty

Plaintiff has also asserted a fiduciary-duty claim against the individual Board members. It is undisputed that members of a condominium board owe a fiduciary duty to the condominium's unit owners. But plaintiff has not established for pleading purposes that this fiduciary duty was breached.

A fiduciary-duty claim against members of a condominium board must "allege any individual wrongdoing by the members of the Board separate and apart from their collective actions taken on behalf of the condominium." (Pine St. Homeowners Assoc. v 20 Pine Street LLC, 109 AD3d 733, 735-736 [1st Dept 2013]; accord Residential Bd. of Millennium Point v Condominium Bd. of Millennium Point, 197 AD3d 420, 424 [1st Dept 2021] [same].) Plaintiff has not alleged that individual wrongdoing here. At most, plaintiff has alleged that each board member voted for the Board's determination; and that requiring plaintiff, rather than all residential unit owners, to pay the paver-related charge was in each Board member's "personal financial self-interest." (NYSCEF No. 22 at ¶¶ 39-40.) These allegations do not identify any particular wrongdoing by particular Board members beyond their taking part in collective decisionmaking on behalf of the condominium. Indeed, other than in the description of the parties (id. at ¶ 3), the amended complaint contains no allegations against specific, named Board members at all.

C. Plaintiff's Declaratory-Judgment Claim

Plaintiff's second cause of action seeks a declaration "that the imposition of the Disputed Charges was improper and that plaintiff does not owe the Disputed Charges." (NYSCEF No. 22 at 14.) The disputed charges referenced in this claim encompass both the initial $32,000 paver-replacement charge and the ensuing late fees/interest assessed on that charge.^[FN11] (See id. at ¶¶ 30, [*7]32.) In moving to dismiss, defendants not only contend that plaintiff is not entitled to a declaration in its favor, but also that this court should grant defendants a declaration "that the LLC is responsible for the costs incurred as a result of the Paver Work." (NYSCEF No. 29 at 19.)

With respect to the initial paver-replacement charge, this court agrees with defendants. Plaintiff has not established that imposition of that charge was improper. To the contrary, for the reasons set forth above, defendants have shown that the Board was entitled to assess that charge against plaintiff; and that plaintiff remains responsible for paying it.

This court reaches a somewhat different conclusion with respect to the increment of the disputed charges corresponding to fees and interest accruing on the initial $32,000. As discussed above in Point II.A.2.b.4, plaintiff has not, on this record, shown that the Board's assessment of the fees and interest was contrary to the condominium bylaws. At the same time, defendants have not established—or even attempted to establish—that the fees/interest were permitted (or required) by the bylaws. Absent clear positions from the parties on the scope of the Board's authority on this issue, the court declines to go on a spelunking expedition in the bylaws to try to figure out the answer.

Defendants' motion to dismiss plaintiff's declaratory-judgment claim is therefore granted with respect to the initial paver-replacement charge; and this court will issue a corresponding declaration. The motion to dismiss is denied with respect to the additional fees and interest.

Plaintiff's third cause of action seeks an injunction compelling defendants to comply with their contract-disclosure obligations under BCL § 727. Defendants contend that this claim should be dismissed under CPLR 3211 (a) (7) for failure to state a cause of action. This court agrees.

As an initial matter, there is no merit to defendants' assertion that this claim is subject to dismissal as an impermissible mingling of direct and derivative claims. (See NYSCEF No. 29 at 12.) Defendants contend that plaintiff's first two causes of action are direct (true); that this third cause of action is derivative in nature because it seeks relief against the Board that would benefit all condominium-unit-owners, not plaintiff in particular (true); and that this action must therefore be dismissed in its entirety for mixing direct and derivative claims (not true).

Caselaw makes clear that it is only when particular causes of action mingle direct and derivative elements that "dismissal of the causes of action so affected" is required.^[FN12] (Barbour v Knecht, 296 AD2d 218, 228 [1st Dept 2002] [emphasis added]; accord Maldonado v DiBre, 140 [*8]AD3d 1501, 1504 [3d Dept 2016] [explaining that when a direct, or "individual[,] claim is 'confused' or 'embedded' within the derivative claim, then it must be dismissed"].) When, on the other hand, a direct cause of action and a derivative cause of action are each separately asserted in one complaint, the presence of both types of claims is not a ground for dismissal. (See Newman v Newman, 202 AD3d 442, 443-444 [1st Dept 2022] [affirming denial of motion to dismiss when "plaintiff's individual claims for breach of fiduciary duty, unjust enrichment, and constructive trust were not duplicative of the derivative claims asserted on behalf of" the corporation].) Defendants do not contend that plaintiff's third cause of action itself mingles direct and derivative claims; only that the complaint as a whole does. And that is not a ground for dismissal.

Defendants also argue that the claim for injunctive relief must be dismissed because "[t]o obtain injunctive relief, the LLC must also have an underlying cause of action," and plaintiff has not articulated a cause of action to support the requested injunction. (NYSCEF No. 29 at 20.) Defendant is correct that a claim for "a permanent injunction," standing alone, "must . . . be dismissed, as [it] do[es] not constitute [an] independent cause of action." (Carlyle, LLC v Quik Park 1633 Garage LLC, 160 AD3d 476, 477-478 [1st Dept 2018].) And plaintiff's opposition papers do not identify, or even attempt to identify, an independent cause of action on which a request for injunctive relief might rest.^[FN13] (See NYSCEF No. 40 at 22-23.) Plaintiff's claim for a permanent injunction is therefore dismissed for failure to state a cause of action.^[FN14]

Accordingly, it is

ORDERED that the branch of defendants' motion seeking dismissal of plaintiff's first cause of action for failure to state a cause of action is granted, and that cause of action is dismissed as against all defendants; and it is further

ORDERED that the branch of defendants' motion seeking dismissal of plaintiff's second cause of action for failure to state a cause of action is granted with respect to the increment of the disputed charges corresponding to the initial $32,000 paver-replacement charge, and denied with respect to the increment of the disputed charges corresponding to late fees and interest assessed on that initial charge; and it is further

ORDERED, ADJUDGED, AND DECLARED that imposition of the initial paver-replacement charge on plaintiff was permissible, and that plaintiff is responsible for paying that charge; and it is further

ORDERED that the branch of defendants' motion seeking dismissal of plaintiff's third cause of action for failure to state a cause of action is granted, and that cause of action is dismissed as against all defendants; and it is further

ORDERED that defendants shall serve and file an answer responding to plaintiff's remaining claim within 30 days of service of a copy of this order with notice of its entry; and it [*9]is further

ORDERED that the parties shall appear before this court for a telephonic preliminary conference on April 25, 2025.