Saturday, March 01, 2008

Eviction case ends with $103K settlement from Forest City Ratner

A Brooklyn woman who wanted to open a day care center in a building in the Atlantic Yards footprint has achived a six-figure settlement her lawyer called a good compromise. Shirley Milligan, according to her attorney, Michael Rikon, had originally been offered $40,000 to reimburse her for her investment, plus the return of her $3000 security deposit.

Milliken signed a lease apparently uninformed that the property was slated for demolition. (Someone--whether it be her or those on the other end of the transaction--apparently could've done more disclosure or diligence.)

Milligan, who stopped paying rent in ground floor space at 487 Dean Street (building at left in photo), last October was slated for eviction. Had that succeeded, Forest City Ratner, which had purchased the building after Milligan signed a rental contract, would've had no obligation to compensate her for a “trade fixture claim,” which includes improvements made, including capital expenditures.

Rikon last October said the developer’s offer was “so low that it was made in bad faith,” indicating that the trade fixture appraiser estimated the value of Milligan’s investment at more than $150,000.

Fair settlement?

The settlement, Rikon said, was $75,000, plus the return of the $3000 security deposit, plus more than $25,000 in rent, for a total topping $103,000. “I frankly was surprised by Forest City's earlier eviction effort,” Rikon said, calling it “not in keeping with their normal practice of being fair to condemnees.”

But the settlement seemed less than initially requested. “The amount invested was not $150,000; rather, that was the estimate given of the upward amount that her trade fixture claim would be,” Rikon said. “We rarely recover 100% of our appraisal value. So, without a formal written appraisal, I am very pleased. All settlements are compromises;, this one was good for Shirley.”

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