Adverse Possession—An Unincorporated Association May Adversely Possess Property – Time of Possession May Be “Tacked On” to Possession by a Corporate Entity to Establish Continuous Possession—Actual Knowledge of Record Owner's Title Is Not Fatal to An Adverse Claim—an Adverse Possessor Need Not be an Adjacent Owner

A plaintiff nonprofit organization was incorporated in 2012. The plaintiff operates a “community garden” (Garden), which was founded by its members in 1985 on Lots 16, 18, and 19 in Block 154 in Manhattan's Lower East Side.” Most of the defendants allegedly were the record owners of Lot 19 during the prescriptive period. One defendant had purchased Lot 19 in January 2014. The plaintiff sought a declaration that it owned Lot 19 by adverse possession. A trial court denied the defendants' motions to dismiss the complaint.

A salient issue on appeal was “whether plaintiff stated a claim for adverse possession of Lot 19 by sufficiently pleading the continuous possession element.” The Appellate Division, First Department (court) found that the complaint sufficiently pled a cause of action for adverse possession.

The complaint alleged that the Garden was formed, more than 30 years ago by people who wanted to improve their neighborhood. Neighborhood lots across the street from an elementary school, had been plagued with “used needles and piles of garbage.” The plaintiff claimed that the “defendants and their predecessors abandoned Lot 19 as a 'shameful eyesore' and…plaintiff and its members took possession and 'by their tremendous efforts transformed the premises into a vibrant community garden where generations of children have thrived.'”

The plaintiff's members, “starting in 1985, cleared garbage and debris, pulled weeds, and erected a chain-link fence to enclose the premises. They planted fruit, vegetables, plants, bushes and trees,” “built…playground equipment, and added a stage used for concerts and to display art.” They also “built a fish pond and pathways throughout the Garden.” The plaintiff contended that the Garden has “never been open to the general public,” and could “only be accessed by first unlocking the gate with a…key secured only by members.” The gates were allegedly locked at night and any other time that Garden use was not in use under the supervision of a member. The Garden was also used for various community activities.

Additionally, the plaintiffs alleged that they had “protected the Garden's claim of right, including against defendants.” They noted that in August 1999, certain defendants or their agents had “cut through the Garden's exterior fence and entered the premises.” The defendants had allegedly chopped down a tree, damaged a children's clubhouse and had made “[a] makeshift interior fence.'” The plaintiffs allegedly “tore down the fence and removed it” and “repaired the other damage.”

The plaintiffs further alleged that, in May 2013, people with “power tools and construction equipment accompanied by private security guards arrived at the Garden, and signaled their intention to breach the exterior fence. A standoff took place” with members blocking the gate. Ultimately, the police ordered that the group of men be given access to the premises. The plaintiffs asserted that the defendants then “'trampled, destroyed, and dug up plants, shrubs, trees' and erected a metal fence inside the Garden purporting to barricade Lot 19 from the remainder of the other two lots.” The defendants also employed a private security firm to guard the premises. The plaintiffs stated that “the fence still cuts across the premises rendering certain vegetable beds, trees and a meditation area inaccessible.”

In December 1998, a defendant had entered into a contract to purchase certain properties, including Lot 19. A defendant seller had warranted that “it would deliver Lot 19 'vacant and free of any occupancy and any claim of right of occupancy.'” In November 1999, in a litigation between the purchaser and the seller, it was alleged that part of the premises was “occupied by third parties claiming a right to use and occupy a portion of the premises.”

Although the seller had claimed that the subject occupancy was “illegal and unauthorized,” the purchaser had “waive[d] the condition in the contract that the premises be delivered vacant.” Thus, the purchaser became the record owner of Lot 19. In January 2014, Lot 19 was conveyed to another defendant, allegedly for $3.35 million and other consideration.

The plaintiff then commenced the subject action in 2014, alleging that defendants had applied to build a six-story residential building on Lot 19. The complaint sought a “declaratory judgment that plaintiff is the sole and exclusive legal and equitable owner of Lot 19, via adverse possession.” The defendants moved to dismiss the complaint for failure to state a cause of action, claiming that since the plaintiff entity had not existed until December 2012, “it could not have occupied the property for the requisite period.” They also claimed that the complaint did not allege that occupancy by plaintiff was done under a claim of right.

In order to establish a claim of adverse possession, a plaintiff must prove that the possession was: “hostile and under a claim of right,” “actual,” “open and notorious,” “exclusive” and “continuous throughout the 10-year statutory period.” Where a claim of right is not based upon a written instrument, “the party asserting title by adverse possession must establish that the land was 'usually cultivated or improved' or that the land 'has been protected by a substantial enclosure.'” In the subject case, the only disputed issues were the “claim of right” and “continuous” elements.

The defendants argued that the plaintiffs failed to show “continuous possession by its predecessor members for the statutory period, through an unbroken chain of privity, by tacking periods between anonymous possessors who are not alleged to have intended to transfer title to the incorporating members.” The defendants emphasized that the plaintiff was incorporated in 2012 and there was “no allegation that plaintiff had the necessary privity with Garden members prior to incorporation.”

The court rejected such defense at this stage of the litigation. The court explained that “an unincorporated association may adversely possess property and later incorporate and take title to it because '[a]lthough the unincorporated society could not acquire title by adverse possession, its officers could for its benefit, and when the corporation is duly organized the prior possession may be tacked to its own to establish its title under the statute of limitations.”

The court found that “the complaint sufficiently alleges possession by the Garden members for nearly 30 years before the Garden was incorporated.” The court cited the alleged significant clean up and improvement work that was done by “the members.” As to the succession of different individual Garden members, the court stated that “[a]ll that is necessary in order to make an adverse possession effectual for the statutory period by successive persons is that such possession be continued by an unbroken chain of privity between the adverse possessors.” Here, the complaint alleged that the Garden members had possessed the lot for more than 10 years and that they transferred their interest in the lot to the corporation in 2012.

An affidavit from a person who was a member of the Garden from 1985 to 1991, explained that he and others had “cultivated, improved, and maintained the Garden,” that between 1991 to 1999, he had observed other members continuing to maintain and possess the Garden and they kept it enclosed and had locked gates.

The court held that the complaint adequately alleged “continuous possession of Lot 19 for more than the statutory period by the same individuals and members of the Garden.” See Reformed Church of Gallupville v. Schoolcraft, 65 NY 134, (1875). The court distinguished cases cited by the defendants and emphasized that, in the subject case, “the same individual members of the Garden worked together, enclosed the property by a chain-link fence, limited access by locked gates, and improved the property.”

Moreover, with respect to the alleged 1999 effort by certain defendants to retake possession of the premises that based on the allegations, the statutory period had been met by 1995 and in any event, the 1999 “intrusion did not cause any destruction in the Garden's exclusive possession, as the members took swift action to repair the damage caused by the unidentified intruders….”

The court rejected the defendants' argument that the post-2008 version of RPAPL 501, which mandates that the adverse possessor have “a reasonable basis for the belief that the property belongs to the adverse possessor” is relevant to the subject matter, since no adverse possession claims were alleged to have “ripened after 2008.”

The defendants further argued that the “plaintiff must plead an initial claim in the land rooted in expectations that have an 'objective basis in fact.'” The court rejected such argument, noting that the Court of Appeals has explained that “adverse possession will defeat a deed even if the adverse possessor has knowledge of the deed….” The “element of hostility is 'satisfied where an individual asserts a right to the property that is adverse to the title owner and also in opposition to the rights of the true owner.'” Furthermore, “[a] rebuttable presumption of hostility arises from possession accompanied by the usual acts of ownership, and this presumption continues until the possession is shown to be subservient to the title of another.”

The court also stated that “'an adverse possessor's actual knowledge of the true owner is not fatal to an adverse possession claim,' absent an overt acknowledgment by the claimant during the prescription period.” Courts have emphasized that “'[t]he issue is actual occupation,' not subjective knowledge.” Thus, “[c]onduct will prevail over knowledge, particularly when the true owners have acquiesced in the exercise of ownership rights by the adverse possessors.” Of course, “[a] presumption of hostility will not apply, however, where the use of disputed land is permissive.”

Since the plaintiff alleged that their “predecessor members continuously occupied Lot 19, improved the land, restricted entry and kept out intruders, and thus actually occupied the land in a manner adverse to the true owner,” the complaint stated a “hostile and under a claim of right” element. There was no indication that “the use was permissive.” Furthermore, “the 'claim of right' element” is not limited to situations where “the adverse possessor is title owner of the adjacent parcel, whose original boundaries extended to the disputed parcel…or whose use of the disputed structure [or land] derived from prior ownership.” Accordingly, the court affirmed denial of the motion to dismiss the complaint.

A concurring opinion agreed that the complaint's allegations, as supplemented by one of the plaintiff's affidavits, established that the plaintiff “may be able to prove that its claim to ownership of [Lot 19] through adverse possession ripened before the amendment to the RPAPL became effective.” However, the concurring opinion stated that whether the unincorporated association's “occupation of the parcel was interrupted by the attempt to oust it in 1999…cannot be determined as a matter of law on a pleading motion.”

The concurring opinion disagreed with the majority to the extent that it held the complaint, supplemented by a different plaintiff affidavit, sufficiently alleged that the unincorporated association “continuously occupied the parcel from 1985 to 1997.” That affidavit alleged that the affiant was a member of the unincorporated association from 1985 to 1991, when he moved out of the neighborhood. The plaintiff had not identified any person who was a member of the unincorporated entity, “or any persons who were members of it, from 1991 to 1997.” Thus, the concurring opinion opined that the plaintiff cannot base “its adverse possession claim on an occupation by an unincorporated association without identifying particular individuals who were members of the association for the entire period relied upon….”

The concurring opinion concluded that if the plaintiff believes it may be able to identify particular individuals who were members of the unincorporated association from 1991 to 1997, “it may seek leave to amend the complaint to add such allegations.” The concurring opinion noted that such plaintiff's affidavit did not allege that two members of the unincorporated association had, in fact, remained members of the unincorporated association during the entire period in question.

Children's Magical Garden Inc. v. Norfolk St. Dev. LLC, App. Div., First Dep't, Case No. 152094/14, Friedman, J.P., Renwick, Tom, Kahn, Kern, JJ. Opinion by Tom, J. All concur except Friedman, J.P., who concurs in a separate opinion.

Landlord-Tenant—Nonpayment Eviction Proceeding Based on Chronic Nonpayment of Rent Dismissed—Specifying Index Numbers for Six Nonpayment Proceedings (One a Year) Without Stating the Circumstances, Was Insufficient—No Specific Number of Underlying Nonpayment Proceedings are Necessary to Support Chronic Nonpayment of Rent Claim

A holdover proceeding was commenced pursuant to Rent Stabilization Code §2524.3(a), alleging that a respondent had “breached a substantial obligation of her tenancy by failing to timely pay rent.” The petitioner alleged in its petition, as well as in its notice of termination, that it had commenced six non-payment eviction proceedings against the respondent and had provided the index numbers for those proceedings. There was one index number for each year from 2012 through 2017.

The respondent moved to dismiss, pursuant to CPLR 3211(a)(7), based on a failure to state a cause of action. The respondent claimed that one non-payment proceeding per year did not “constitute chronically failing to pay rent.”

The petitioner countered that there was “no specific requirement as to the number of cases that need to be filed within a specified time period for a cause of action for chronic non-payment of rent to be stated.” The petitioner also submitted papers in opposition which provided “more detail as to the duration of the underlying non-payment proceedings” and provided the respondent's rent payment history.

The court explained, inter alia, that the petitioner was “bound by the notice of termination” that it had served, which was “not amendable” and that “the number of non-payment proceedings a landlord has been required to commence is relevant only in the context of the entire circumstances surrounding the withholding of rent.” Both parties had acknowledged that there was “no specific number of underlying non-payment proceedings necessary to support a cause of action for chronic non-payment of rent.”

The court held that the petition failed to state a cause of action, since it merely stated the index numbers for six non-payment proceedings over six years, “without stating any other facts related to her alleged chronic non-payment of rent….” The court explained that although the petitioner may have a cause of action for the respondent's alleged chronic nonpayment of rent, it was not stated in the notice of termination and petition. Thus, the court granted the respondent's motion to dismiss without prejudice.

3175 GC LLC v. Basey-Goodison, Civ. Ct., Bx. Co., Index No. 68357/17, decided July 20, 2018 Baum, J.

Scott E. Mollen is a partner at Herrick, Feinstein.