Manee-Seguine Homestead in Staten Island. Image Credit: Wiki.

Owner of Staten Island landmark who failed to maintain property forced to give landmark to City after accruing $8.55 million in regulatory fines. The Manee-Seguine Homestead in Staten Island was built by Paulus Regrenier in 1670. The City designated the Homestead a City landmark in 1984. In September 2008, the Department of Buildings declared the Homestead was dangerous and dilapidated and ordered its demolition. The Landmarks Commission intervened, preventing the Homestead’s demolishment. Seguine Bay Estates bought the property a year later, in 2009, but neglected to make the repairs. In 2013, Buildings ordered Seguine to make repairs. Three years later, in 2016, Landmarks sued Seguine in Richmond County Supreme Court to force Seguine to make the repairs. Seguine filed a hardship application with the court, stating that the Homestead was too dilapidated to repair, and any repairs would exceed the cost of the lot’s market value.

In a December 2016 Supreme Court Justice Philip Straniere ruled that the Homestead must be preserved, found that Seguine had failed to maintain the premises, and assessed a penalty at the maximum of $5,000 per day for a total penalty of $8,550,000.

Under the Landmarks law, however, a penalty may not exceed the fair market value of the landmark. Judge Straniere held a two day hearing on March 7 and 8, 2017 to take expert testimony on the fair market value of the landmarked Homestead.  Property appraisal experts on both sides offered competing assessments of the value of the Homestead with or without improvements to the property, taking into account the numerous regulatory costs of possible development of the lot into residential or commercial buildings. The Homestead property is regulated by zoning, wetland protections, flooding restrictions as well as landmark protections.

Neither assessment came close to appraising the fair market value at the $8,550,000 fine level Judge Straniere had imposed.

On May 7, 2017, Judge Straniere ruled that the parcel of land had a $0 free market value after taking into account the regulations associated with making improvements. The Homestead was undevelopable, and would have no value to be anything other than a landmark in the City’s possession.

Judge Straniere ordered the owner to turn the property over to the City as payment of the fine. Judge Straniere ruled that even though the various regulations constituted a taking, the owner was not entitled to compensation. The owner lost its right to compensation by its conduct and had created a situation where the property was forfeited to the City in full payment of the judgment and fines.

City of N.Y. v. Seguine Bay Estates, L.L.C., 56 N.Y.S.3d 796 (Richmond Cty.Sup.Ct. 2017) (Attorneys: Zachary W. Carter, Michelle Goldberg-Chan, Karen B. Selvin, Rachel Moston, for City; Howard M. File, for Seguine).

By: Dennis Futoryan (Dennis is a student at New York Law School, Class of 2019)