Months After Fire, Bitter Legal Battle Intensifies

289 Grand Street.

In the hours after fire ravaged three buildings on Grand Street this past spring, displaced residents found themselves in the media spotlight. Three months later, the television cameras and daily newspapers are gone. But the people whose lives were upended on the night of April 12th are no closer to putting the disaster behind them. In fact, they are entangled in a legal dispute that could go on for months, or even years.

The latest skirmish played out earlier this month in front of 289 Grand, which is the subject of a Department of Buildings ‘vacate order.”  The owner, Wong’s Grand Street Realty, told tenants it would begin packing up their belongings for curbside pickup on the morning of July 10th. This did not sit well with Asian Americans for Equality, the organization representing tenants in 9 of 289 Grand’s 14 apartments.

There was apparently an ugly confrontation on the street between members of the Wong family and AAFE representatives, who claimed a court order guaranteed residents temporary access to their apartments. In a strongly worded letter fired off two days later, Wong family attorney Adam Leitman Bailey contended, “the idea of a typical ‘move out’ … is impossible at best and at worst an invitation to injury, severe harm or even death.”

While this dispute rages on, attorneys on both sides are preparing for the bigger fights ahead — (1) an effort to compensate tenants for property losses and (2) a lawsuit in housing court attempting to force the landlord to repair the building and, ultimately, to allow the residents to return. The Department of Housing Preservation and Development has joined the housing case on behalf of the tenants.

Adam Leitman Bailey

Bailey is mounting what’s known as an “economic infeasibility” defense, which will require him to show that the cost of making 289 Grand habitable would exceed the market value of the building.  During a conversation several days ago, he directed us towards a column he authored about the defense in 2007.

The article acknowledged the difficulty building owners face in these kinds of cases, but argued landlords are on firmer footing when the “economic woe of the building is (not) self inflicted.”  Since 289 Grand’s condition was caused by fire and not by landlord neglect, Bailey suggested, his client has an excellent chance of prevailing. He said, flat out, “we will win this case.”

John Gorman, AAFE’s attorney, strongly disagreed. Citing the Department of Buildings’ initial analysis of 289 Grand, he said it’s clear the damage done during the fire was “localized” and “not that overwhelming.” On June 24th Civil Court Judge David Kaplan ordered Wong’s Grand Street Realty to turn over insurance documents, as well as other records, such as independent engineeting reports. Gorman said these documents are essential to assessing the condition of the building, as well as its financial picture.

Bailey said AAFE is manipulating the tenants and is “really an organization causing chaos for no reason.”  Asserting that it could take three years to renovate the building, he urged “everyone to find a new home.”  Bailey said 289 Grand is primarily a market rate building with a small number of rent controlled tenants. He declined to give a breakdown of the 14-unit building. But Gorman told The Lo-Down he represents nine tenants, all rent controlled. At least two apartments in the building were occupied by members of the Wong family, he said. AAFE’s Chris Kui indicated at least one tenant in a market rate unit accepted a settlement offer from the landlord.

Shortly after the fire, AAFE's Chris Kui conferring with displaced residents.

Kui said it’s clear to him the Wong family is seeking to force the rent controlled tenants out so the building can be converted into a market rate condominium or sold. He said the “economic infeasibility” defense obscures the real issue — “the fact that these tenants have rights and that they have leases.” Kui also suggested that the owner tried to intimidate tenants, telling them they could only enter the building to collect their belongings if they agreed to accept a settlement offer and move elsewhere.

Bailey rejected these arguments, saying his clients are not “bad people.” In the July 12th letter to Gorman, he added:

Mr. Wong, two of his three sons as well as their wives and his grandchildren have also been displaced by this fire. The grandchildren are only 5 and 7 years old. They too have lost all of the items that made their life comfortable. The grandchildren of Mr. Wong were among the youngest children in the building at the time of the fire and suffered anxiety and despair as a result of losing their beloved toys and the only bedroom they knew. To make matters worse, the family is scattered so that these children cannot simply traverse a set of stairs to see their grandparents. Therefore nobody in the entire building more anxiously desires the restoration of the community that the building was than does the Wong family.

The letter concludes, “It seems to me that we need to replace the spirit of confrontation with a spirit of cooperation.”

Meantime, it remains uncertain if and when the residents will be able to personally pack up their apartments. Bailey indicated the DOB’s vacate order is clear: tenants cannot enter the building.  A DOB spokesperson told us these situations are handled on a case-by-case basis. She was checking to see, specifically, what DOB inspectors have concluded about temporary access to 289 Grand.