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Developer sues co-op residents over construction defect claims

About two years ago, residents of a Harlem cooperative wrote a letter drawing attention to what they claimed were construction defects in their city-subsidized building. The letter was sent to the Department of Housing Preservation and Development (HPD), and this year the letter was disseminated to state legislators.

Now the building developer is suing three of the co-op residents, accusing them of defamation. Madison Park Development Associates is seeking $1 million from each of the residents, who live in a middle-income co-op. The firm is also seeking an additional $1.25 million.

According to the three residents, however, the letter alleging construction defects and faulty repairs was signed by dozens of residents. In particular, it was claimed that leaks have persisted in the nine-story building since its construction in 2002.

Meanwhile, the developer points to a city report from 2012 that apparently deems the building as satisfactory.

The head of the development firm characterized the residents' concerns as "made up" and not "fact-based."

Union officials have also weighed in on the dispute, claiming that the lawsuit is indicative of the HPD's favoritism in awarding contracts to developers that don't deliver safe, well-built homes.

In response, a director with the New York State Association for Affordable Housing blamed unions for the high cost of building affordable housing.

The outcome of the defamation lawsuit remains to be seen. New York law prohibits suing a private citizen for voicing an opinion about a public issue.

Construction disputes between developers, management and unit owners can become extremely complex, and early intervention is often the key to limiting costs for everyone involved. If you find yourself tangled in such a dispute, then a real estate attorney can help clarify your options for a favorable resolution.

Source: New York Daily News, "EXLUSIVE: Harlem homeowners hit back at 'rich, powerful' real estate developer who slapped them with $4.25M lawsuit," Daniel Beekman, April 11, 2014

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