PLAYING NICE WITH THE NEIGHBORS: DEALING WITH ADJOINING PROPERTIES DURING CONSTRUCTION

© Ingram Yuzek Gainen Carroll & Bertolotti LLP

Robert A. Banner & Jessica L. Rothman

February 9, 2017

MEET THE SPEAKERS

Robert A. Banner, PartnerIngram Yuzek Gainen Carroll & Bertolotti

Jessica L. Rothman, PartnerIngram Yuzek Gainen Carroll & Bertolotti

STATE OF THE MARKET

Construction in New York City continues to boom.

As an owner, developer or project team member, you need to understand how your project impacts the adjacent properties and what you are required to do with respect to these properties under the building code.

*Credit: New York Building Congress- NYC Construction Outlook Update 2016 https://www.buildingcongress.com/outlook/

YOU NEED TO KNOW...

• Why you need access

• What the law requires • How to comply

WHY YOU NEED ACCESS

• The proximity of buildings and the scale of construction poses risks to adjoining properties.

• New York City Building Code requires the owner or developer performing construction work to protect adjoining properties.

WHAT THE LAW REQUIRES

§ 3309.1 Protection must be

provided for footings,

foundations, party walls, chimneys, sky-

lights and roofs. Provisions made to

control water run-off and erosion during

construction or demolition activities.

§ 3309.4 If performing

excavation work protect adjoining

property from damage by

appropriate means and at own expense.

§ 3309.6Property owner to

monitor the ongoing effects of

construction on the adjoining properties

to ensure that no damage occurs.

WHAT THE LAW REQUIRESNotification is required. • Written notification at least 60 calendar days prior to the

commencement of work.

• Notification shall describe the nature of work:• Estimated schedule/duration• Details of inspections or monitoring to be performed• Protections to be installed• Contact information for the project.

• If no response, a second notification shall be made no more than 45 days (not less than 30 days) prior to commencement of work.

• To comply with these codes you need access to adjoining properties.

• Access requires a license, which can be given voluntarily by the adjoining property owner or, in some circumstances, compelled by court order under New York Real Property Actions and Proceedings Law Section 881.

HOW TO COMPLY

KEYS TO SUCCESS

Enter into a license agreement to: • Minimize cost and duration of your project

• Get access early to do what is necessary to complete your project.

• Comply with DOB requirements

• Avoid project disruptions(Avoid/minimize 311 complaints)

Establish Good Relations with the Adjoining Property Owner

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TOP 10 CONSIDERATIONSWHEN NEGOTIATING A LICENSE AGREEMENT

TOP 10 CONSIDERATIONS

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1. Define the full scope of the access work.• Provide detailed plans for access work

• Include terms in License Agreement that also permit you to comply with any unstated building code requirements.

TOP 10 CONSIDERATIONS

2. Should provide reasonable time frame for the access work.

TOP 10 CONSIDERATIONS

3. Conduct a pre-construction survey. • A pre-construction survey of the

adjacent properties (exterior and interior) should be conducted by your contractor or consultant prior to commencement of any work.

• Adjoining property owners typically request copies of the survey.

TOP 10 CONSIDERATIONS

4. Protect & Monitor.

• The adjoining property should be protected and monitored during the construction work.

• Depending on the project, vibration and movement monitoring may also be required.

TOP 10 CONSIDERATIONS

5. Insurance. • Insurance should be provided by the

owner/developer and the contractors in compliance with building department requirements at a minimum.

• Adjoining property owner should be named as additional insureds.

• Owners/Developers should make sure the contractors maintain the insurance for duration of the project.

TOP 10 CONSIDERATIONS

6. Indemnification• Limit reimbursement to

damages arising out of the defined access work to the extent the work was negligently performed.

• Pass through to Contractors

• Critical to have pre-existing conditions documented (pre-construction survey).

TOP 10 CONSIDERATIONS

7. What happens if there is damage to adjoining property?• Immediately document the alleged damages.

• Notify insurers of circumstances that might give rise to claims.

• If possible, agree on scope & timing of repairs.

• Consider who will pay repair costs.

TOP 10 CONSIDERATIONS

8. License Fee

• Consider whether a license fee should be paid to adjoining property owners.

• Court can impose: Law requires you to trespass on adjoining property.

• Risk v. Reward: Small price to pay for less conflict.

TOP 10 CONSIDERATIONS

9. Consider whether legal fees and consultant costs should be reimbursed.• Limit to review of access plans and negotiating

agreement.

• Reasonable rates.

• Keep in mind that courts awardthese fees.

TOP 10 CONSIDERATIONS

10. Set up a process for receiving communications or complaints

• Contact Person: Minimize interference with work by supplying adjoining property owner with contact person to call or email with issues.

• Project Hotline Number: Avoid 311 complaints in the first place.

QUESTIONS