Seven years’ war: Simon Baron, tenant brawl over $25M penthouse

Leaks at Barry Fox’s posh apartment expose bizarre legal drama

New York /
Dec.December 13, 2021 08:00 AM
12 East 88th Street, Jonathan Simon of Simon Baron Development, and Barry Fox, attorney retired from Cleary Gottlieb (Rosario Candela, Cleary Gottlieb)

12 East 88th Street, Jonathan Simon of Simon Baron Development, and Barry Fox, attorney retired from Cleary Gottlieb (Rosario Candela, Cleary Gottlieb)

A legal drama has been dogging Simon Baron Development and a well-heeled tenant at its Upper East Side apartment building, retired attorney Barry Fox, for seven years. Last week, the plot thickened.

At the dispute’s core is an incomplete condo conversion that has left Fox in limbo. Denied the right to purchase his home of 46 years and unable to rent it to someone else, Fox has filed a new case over a slew of housing violations that his lawyer says make the apartment uninhabitable.

Housing violations are a dime a dozen in New York City, but not in penthouse units that rent for 275,000 dimes a month. That’s $27,500, if you haven’t had your coffee this morning.

The sprawling, 12th-floor apartment, at 12 East 88th Street, is steps from the Guggenheim and has views of Central Park.

Fox, through a corporate entity, sued the unit’s owner, an affiliate of Simon Baron, citing 47 open violations that the complaint alleges pose a danger to Fox’s health and safety.

The violations, recorded by the city’s Department of Housing Preservation and Development, include visible mold, crumbling plaster, a leaky ceiling and a broken floor.

Richard Emery, the high-profile lawyer who filed the suit, said Simon Baron has put off repairs to push Fox out.

“Simon Baron has litigated against Barry Fox with what appears to be the goal of evicting him,” said Emery, referring to past cases. “The deplorable conditions in the apartment would seem to serve that purpose.”

The response from the defendant’s counsel, Paul Coppe: “Not true.”

Coppe said the problems with Fox’s unit stem from water coming through the building’s facade, which is the responsibility of the uncooperative condo board.

Simon Baron Development does not control the condo board, but it has seats on it, which Emery said gives the firm some pull.

“They have not taken any formal action to force the condo to meet its responsibility on the facade, which they easily could do,” Emery said. “Simon Baron is responsible for curing those violations and plainly intends to seek huge profits from evicting Barry Fox.”

That is, if Fox leaves, the developer can sell the combined penthouse unit, which its offering plan priced at a cool $25 million. The luxury market has been rebounding, Emery noted.

Simon Baron bought the rental building in 2014, when Manhattan condo prices were at a 19-year high, with the intent of converting it to condos.

In response, Fox lawyered up. He found that the apartment for which he had paid market rent for nearly two decades should have been rent-stabilized, court documents show. He had combined the unit with a neighboring apartment in 1996 under his then-landlord Nostra Realty in an agreement that ended the unit’s rent-stabilized status but entitled him to unlimited renewals.

His lawyers discovered, however, that the building had received the J-51 tax break at the time, which should have ensured it remained rent-stabilized.

Fox took the matter to court, suing his former landlord and Simon Baron weeks before his lease was set to expire. He alleged he’d been overcharged on rent by $4 million.

He continued to pay rent for four months after his lease expired in May 2014, then stopped paying until 2017, court documents show.

In 2015, Simon Baron filed plans to begin the conversion. The developer offered Fox the opportunity to buy his apartment at an insider discount, which brought the final price from $9.3 million down to $5.5 million, court documents filed by Fox allege.

But when Fox accepted, Simon Baron said the tenant was in default for failure to pay rent and was not eligible to purchase the unit.

So Fox sued again, this time asking the court to make Simon Baron to honor the deal. But first he had to win his rent case. And he didn’t.

The Appellate Division ruled that his unit had not been subject to rent-stabilization because he had signed the lease through a corporate entity — his consulting business. Under state law, rent regulation is for primary residences only. By losing the rent lawsuit, he lost the suit to purchase the apartment as well.

For the past two years, Simon Baron has been working to get Fox out of the unit. In 2019, the developer filed its own suit, a holdover action seeking possession of the apartment. It claimed Fox was on the hook for $2.6 million in unpaid rent as of December 2018.

The case resulted in a split decision that both parties appealed in October. Emery said it should go to trial next year.

In the meantime, though, the apartment’s condition has forced Fox to live elsewhere, his lawyer said.

Simon Baron’s counsel, Coppe, said his client is more than willing to repair the inside of the apartment, but that there is no point in doing so until the leak is addressed.

Coppe added that the developer plans to bring in the condo board as a party in its holdover case against Fox. The board is listed as a defendant in Fox’s court action over the unaddressed repairs.

The level of dysfunction between the litigious tenant and landlord is such that they cannot seem to cooperate even when they agree. Coppe said his team has tried to gain access to the apartment to fix the non-leak-related problems in the apartment, such as a broken floor, but has not been given access.

“That is false,” said Emery. “They have been given multiple opportunities to access the apartment. We have arranged multiple inspections by their expert and ours, as well as workers, and nothing has been done.”





    Related Articles

    arrow_forward_ios
    Alex and Yanina Sapir (Getty, Instagram, Illustration by Kevin Rebong for The Real Deal)
    Developer Alex Sapir’s wife files for divorce, citing a “loveless” marriage
    Developer Alex Sapir’s wife files for divorce, citing a “loveless” marriage
    Barbara Russo, Danielle Englebardt, and Oren and Tal Alexander (Getty, iStock BFA)
    Ranking the top residential brokers on the Upper East Side
    Ranking the top residential brokers on the Upper East Side
    1552-1560 Broadway and Wharton Properties’ Jeff Sutton (Google Maps)
    Investor claims Jeff Sutton cheated him out of millions on Times Square deal
    Investor claims Jeff Sutton cheated him out of millions on Times Square deal
    Adam Leitman Bailey, Y. David Scharf, and Miki Naftali with 215 West 84th Street (Adam Leitman Bailey, Morrison Cohen, Getty)
    Naftali lays out project as holdout tenant plays new card
    Naftali lays out project as holdout tenant plays new card
    Harry and Linda Macklowe (Getty Images, Andy Warhol Foundation for the Visual Arts, Inc./Artists Rights Society (ARS), NY, Sotheby's, iStock)
    Macklowe art collection fetches nearly $1B at auction
    Macklowe art collection fetches nearly $1B at auction
    Midwood’s John Usdan and 210 Douglass Street (Midwood)
    Landlord in rush for 421a booted Gowanus business: lawsuit
    Landlord in rush for 421a booted Gowanus business: lawsuit
    Elad Group's Isaac Tshuva and1299 Third Avenue (Getty, Google Maps)
    Elad picks up shovel-ready UES development site
    Elad picks up shovel-ready UES development site
    Patrick Nelson of Nelson Partners Student Housing and the Skyloft Austin (Nelson Partners Student Housing, STG Design, iStock)
    Languishing student housing firm on the hook for $50M
    Languishing student housing firm on the hook for $50M
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...