The Real Deal New York

Judge refunds $1M deposit to Rushmore buyer

Banking exec had agreed to pay $6.9M for UWS spread

January 29, 2013 06:05PM
By David Jones

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The Rushmore and Kelly Coffey (source: CityRealty and Elle)

In the last major court battle of a multi-year escrow dispute at the Rushmore condominium, a State Supreme Court judge ruled in favor of a Wall Street executive who sued to rescind her $6.9 million purchase at the building.

Supreme Court Justice Debra James ordered Extell Development and Carlyle Realty Partners to refund more than $1 million to Kelly Coffey, a Manhattan resident who originally agreed to buy the unit in 2007. The judgment represents Coffey’s down payment, plus interest and fees.

The head of diversified industries investment banking at JPMorgan Chase, Coffey filed suit in October 2009, alleging the developers failed to close the first apartment sale by a September 2008 deadline. The suit followed more than 40 escrow disputes filed with former Attorney General Andrew Cuomo over a failure to meet the initial deadline.

The developers claimed that the September 2008 deadline was a typographical error, and that the actual deadline should have been September 2009. But multiple courts rejected that argument, adding that the developers failed to amend the plan to correct any change in the closing date.

Coffey, who agreed to combine two adjacent apartments at the 80 Riverside Boulevard tower, also claimed in her suit that the developers failed to get a permanent certificate of occupancy and failed to obtain proper regulatory approvals to combine the units.

The developers in December 2012 released more than $16 million in escrow funds to more than 40 buyers at the Rushmore, after their exhausting their state appeals of Cuomo’s 2010 order to refund the deposits. The developers were rejected at least three times in federal court.

“My client is extraordinarily pleased with the court’s decision today,” said Marc Held, a partner at Brooklyn-based Lazarowitz & Manganillo and attorney for Coffey. “The court has made it very clear that there was no typographical error in the contract and no legal excuse for not returning my client’s down-payment monies as of Sept. 2, 2008.”

Extell officials did not return requests for comment. A spokesperson for the Rushmore did not have any immediate comment.

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