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Mold Contamination

The problems arising from mold contamination, the latest environmental hazard facing indoor occupants, are illustrated in 157 East 57th Street LLC v. Birrenbach. Here the issue was the adequacy of the landlord's remediation of this condition in a rental building and the consequences of delay.

In this summary nonpayment proceeding, the Birrenbachs conceded that they had not paid rent from November 2000 through February 14, 2003. The parties agreed that the total amount of the unpaid rent was $41,567.97. The dispute between the parties involved a severe mold condition in the Birrenbachs' apartment that they claimed resulted in their constructive eviction from the apartment for the entire period at issue. The landlord claimed that the condition was not serious enough to merit a finding of constructive eviction, that it was corrected no later than June 2002, and that Birrenbach's behavior substantially delayed the correction of the problem. The matter was tried before the court on various dates from December 2002 through February 2003.

Albert Foyer, managing agent for the building, testified for the landlord. Cleo Birrenbach testified for the Birrenbachs. In addition, each side presented the testimony of experts in the field of mold testing and remediation. Edward Olmstead testified as an expert for the Birrenbachs, and John Mark Hodgson and Barbara Woodhull testified as experts for the landlord.

The landlord also presented the testimony of Thomas Cataldo, an engineer who conducted testing and supervised repair work on two terrace drains above the Birrenbachs' apartment, of the building superintendent, and of another individual who performed work in the building. Based on the evidence at trial, the court made the following findings of fact.

Beginning in May 2000, the Birrenbachs noticed that a water leak was causing stains on their living room ceiling. Then on May 22, 2000 there was a major flood into the apartment in the middle of the night. Filthy brown water poured through the ceiling of the master bathroom and an adjacent closet. The superintendent for the building, summoned by the Birrenbachs, observed the flood in the middle of the night. He returned the next morning and pulled down the water-logged ceilings in the bathroom and closet. Ms. Birrenbach testified without contradiction that water continued to leak sporadically in these areas, and that the ceilings remained unrepaired, for several months. The superintendent restored the ceilings in August 2000 but the leaking continued, and several more attempts at plaster repair were made. The Birrenbachs stopped using the master bedroom and bathroom immediately after the May 22, 2000 flood, because the smell of the dirty water was intolerable.

On October 5, 2000 the Birrenbachs returned from a three-week vacation to discover that the closet affected by the leak was covered with black mold, and that the entire apartment was filled with a foul stench. They removed the contents of the closet and observed a large hole in the closet wall. They called the landlord who sent two individuals to observe the condition. Then they packed up some belongings and left the apartment. They did not return to the apartment to live except for a single night, December 28, 2000, when they were locked out of a temporary sublet elsewhere in the building and had no other place to go.

Ms. Birrenbach testified that in a November 2000 visit to the apartment she noticed additional water staining on the ceiling in the living and dining rooms. In December 2000, when she and her husband stayed in the apartment overnight, he observed that the wood floor under these stains was warped and that "black stuff" was visible on the floor. At the same time, she observed black mold around a vent in the master bathroom.

The Birrenbachs filed a housing preservation action against the petitioners in November 2000, seeking correction of the leaks and the mold condition in their apartment. An inspector from the New York City Department of Housing Preservation and Development (HPD) visited the apartment on November 30, 2000. The inspector wrote four "C," or "immediately hazardous," violations for mold in the closet, adjacent hallway, and master bedroom. The inspector also wrote four "B" violations and three "A" violations for ceiling water leaks in the living room, dining room, hallway, and bedroom. The landlord signed a consent order on December 8, 2000, agreeing to correct these violations.

There were apparently disputes between the parties with respect to the scope of work to be performed in the apartment. These disputes delayed the start of repair work. The landlord sought a court order for access but then sought a delay so that it could conduct further tests to determine the source of the leaks into the apartment. On February 2, 2001, Judge Rodriguez ordered immediate access for mold abatement, with a provision for additional access in the event that the landlord's additional water testing led to a need for additional repairs.

In May 2001, the tenants moved in the HPD case to punish the landlord for contempt of court and for civil penalties for failure to abate the mold. Re-inspections of the apartment by HPD inspectors on January 19, 2001, April 7, 2001, and July 11, 2001, revealed the continued presence of immediately hazardous mold in the bedroom, closet, bathroom, and hallway as well as continued leaks from the roof in the same areas.

After a lengthy hearing, Judge McGowan issued a decision and order dated November 23, 2001 which resolved the motion. Judge McGowan found that active mold still existed in the Birrenbachs' apartment. She further found that the landlord's attempts at mold remediation "failed to meet the basic standard for mold and mildew removal."

Judge McGowan also found that the mold in the apartment was now worse than it had been when the HPD case began. Specifically, she held that there were now "multiple leaks and a more pervasive mold problem" because the landlord had never located the source of the original leaks and corrected them. She found that there were now "gaping holes" in the apartment ceilings.

Addressing the landlord's claims that the Birrenbachs had impeded the progress of the remediation work, Judge McGowan held that, although the Birrenbachs "may have impeded the progress of the work to some degree, the landlord's failure to correct these serious violations over such an extended period of time cannot be attributed to the tenants' actions."

She did reduce the civil penalties by half in recognition that some delay had been caused by the Birrenbachs. She then issued an order requiring that the mold condition in the Birrenbachs' apartment be corrected "forthwith utilizing New York City Department of Health's Guidelines on Assessment and Remediation of Fungi in Indoor Environment, Level IV remediation."

The Birrenbachs moved again in March 2002 for contempt and civil penalties in the HPD case, claiming that the landlord had not performed a Level IV remediation. After a two-day hearing with expert testimony, Judge Fitzpatrick, by order dated August 26, 2002, held the landlord in contempt based upon a finding that, the landlord had not corrected the mold condition in the Birrenbachs' apartment and had deliberately failed to conduct a Level IV remediation as required by Judge McGowan's order. Judge Fitzpatrick noted in his decision and order that the landlord had consented in the course of the hearing before him to conduct a Level IV remediation in the apartment in June 2002.

Edward Olmstead, the Birrenbachs' expert witness, conceded that the scope of work developed by Clayton Group Services, the landlord's new mold expert, for the June 2002 remediation was sufficient to meet the city standards for a Level IV remediation. The court found, relying upon the credible testimony of Barbara Woodhull of Clayton, that the June 2002 remediation conducted in the Birrenbachs' apartment met the requirements for Level IV remediation. Olmstead did not seriously contest this claim.

Olmstead and Woodhull disagreed sharply, however, about whether the June 2002 remediation had successfully eliminated dangerous mold from the apartment and whether the mold condition still existed at the time of trial.

Olmstead visited the apartment with the Birrenbachs to inspect and collect samples after the Level IV remediation of June 26, 2002. He collected bulk samples of plaster from the living room wall behind the baseboard close to the floor, and from the base of the wall behind the baseboard in the hallway outside the master bathroom. Olmstead's report, dated July 14, 2002 and admitted in evidence, noted that Olmstead had urged unsuccessfully that the plaster walls in this area be removed during the remediation. Olmstead noted that there were no "regulatory or reference levels of mold growth in materials."

In other words, there were no legal or generally accepted levels of mold in a bulk sample considered to indicate contamination. However, he asserted that "most building clean plaster has mold levels below 10,000 colony forming units per square inch (CFU/in). Levels over 100,000 are indicative of moderately elevated levels of colonization. Levels over 1 million CFU per gram or square inch are indicative of elevated microbial contamination."

Olmstead's bulk samples contained 14,800 and 32,000 CFU/gram of mold. Olmstead reported that this was evidence of continued contamination, and he recommended that the Birrenbachs remain out of the apartment until the plaster in the affected areas was removed.

The landlord's experts, from Clayton Group Services, collected air samples from inside the apartment and from outside the apartment and outside the building on June 24, 2002, also after the completion of the Level IV remediation. The results showed that there were lower levels of fungal structures in the air inside the apartment than there were in the air outside the building on the date of the testing. Clayton's post-remediation report, dated September 6, 2002, was admitted in evidence.

Woodhull testified that in her opinion, the best way to determine whether remediation has been successful is to conduct a visual inspection and to take air samples. She explained that there were always mold spores in any area, and that it was impossible to remove all mold. If the air samples taken inside an apartment show mold levels above those in the outside air in the same general vicinity, then the results indicate that there is a continuing indoor source of mold. If the mold content of the indoor samples is the same or lower than that of the outdoor samples, then there is probably no indoor mold source. Woodhull indicated that she would recommend bulk samples only if the air samples suggested an indoor source. The purpose of the bulk samples would then be to identify the indoor source.

New York City's guidelines for Level IV remediation specifically provided that, following a Level IV remediation, air sampling should be used to determine whether the affected area was fit for reoccupancy. Woodhull also testified that mold colonies cannot grow without an organic food source. She said that, although mold will grow on sheetrock, because the paper used to cover sheetrock is a good organic food source, it does not grow on plaster because plaster is inorganic.

Woodhull testified about Olmstead's bulk samples, noting that, in her opinion, the samples showed normal and expected levels of mold. She indicated that she had never heard a mold level of over 10,000 CFU/gram described as contaminated. In fact, she indicated that Clayton considered a level of 100,000 CFU/gram to be contaminated, and that levels between 50,000 and 100,000 could be considered to be "of concern." She also stated that the Federal Occupational Safety and Health Administration considers levels of over 1 million CFU/gram to be contaminated.

On the basis of Woodhull's credible and persuasive testimony, the court found that the Birrenbachs' apartment was no longer contaminated with mold after the completion of the June 2002 remediation, and that the apartment could have been safely reoccupied by the Birrenbachs on or before July 15, 2002 when the testing had been done and the results reported by the testing laboratory.

There was one aspect of Clayton's recommended remediation which was not completed, namely the removal, cleaning, and reinstallation of the air conditioning units in the apartment. All of the experts indicated that these units were not dangerous as sources of recontamination provided that they were not turned on until after they had been removed and cleaned.

Accordingly, the court ordered that the landlord arrange for qualified personnel to remove, clean, and restore the air conditioning units in the Birrenbachs' apartment, in accordance with the specifications developed by Clayton, on or before June 1, 2003, the earliest date by which the Birrenbachs could be expected to need the units.

The court said that a tenant may assert constructive eviction as a defense to a claim of nonpayment of rent where the tenant has been compelled to abandon all or a part of the premises as a result of acts by the landlord that make all or part of the premises unusable by the tenant. Constructive eviction is found where the tenants were compelled to abandon the premises beause of "the landlord's wrongful acts which substantially and materially deprived the tenants of the beneficial use and enjoyment" of the premises.

The court held that the Birrenbachs were constructively evicted from their apartment by the hazardous mold from October 5, 2000 through July 14, 2002. The presence of immediately hazardous mold was confirmed in multiple locations in the apartment by HPD inspection in November 2000, shortly after the Birrenbachs abandoned the apartment. In addition, Olmstead inspected the apartment thoroughly in November 2000 and periodically thereafter.

In his reports to the Birrenbachs dated November 20, 2000, December 5, 2000, February 14, 2001, and March 17, 2001, Olmstead reported that water leaks continued throughout this period in the bedroom, bathroom, hallway, and closet as well as in the living and dining rooms. He observed large areas of visible mold, confirmed by laboratory testing. In December 2000, he reported the presence of varieties of mold capable of causing allergic reactions, severe sinusitis, and even liver damage.

Olmstead testified that he advised the Birrenbachs to remain out of the apartment until the mold condition was remedied and that he repeatedly advised them thereafter during the relevant period that the condition had not been corrected. Cleo Birrenbach testified credibly that she and her husband experienced respiratory symptoms, and even nosebleeds, between May 2000 and their departure from the apartment in October 2000.

Given the extensive nature of the mold contamination in the apartment, and given that the affected area grew larger and larger during the time period at issue, that petitioner's various efforts at abatement did not result in any abatement of the condition until June 2002, that the mold caused a foul odor in the apartment, and that the Birrenbachs suffered respiratory symptoms as a result of the mold before their departure from the apartment, the court determined that after they discovered the more severe mold contamination in the closet in October 5, 2000 they were compelled to abandon the apartment.

The court further found that the areas of the apartment affected by the mold were sufficiently large, and sufficiently spread out within the apartment that it would not have been possible for the Birrenbachs to continue living in the unaffected parts of the apartment without being exposed to the mold in the living room, dining room, bedroom, bathroom, hallway, and closet.

The conditions which required the Birrenbachs to abandon their apartment in October 2000 were the result of the landlord's failure to correct serious water leaks into the Birrenbachs' apartment earlier in 2000 as well as the landlord's failure to address the mold in the apartment when it was first visible earlier in 2000. The landlord had notice of the leaks no later than May 2000 and was fully aware of the condition of the apartment between May and October 2000 as well as at all relevant times thereafter.

The landlord claimed that the Birrenbachs frustrated its efforts to remediate the mold throughout the time period at issue.

Although Judge McGowan found in her Decision dated November 23, 2001 that the Birrenbachs had impeded the progress of the petitioner's work "to some degree," she also found that the petitioner's "failure to correct these serious violations over such an extended period of time cannot be attributed to [the Birrenbachs'] actions." Furthermore, it was significant that, after Judge McGowan's Decision, the landlord proceeded once again to conduct an inadequate remediation of the mold condition, resulting in yet another finding of contempt in August 2002. Based upon these facts, the court found that the Birrenbachs' actions, while undoubtedly annoying at times, did not significantly delay the correction of the conditions that caused their constructive eviction.

Because of the findings, the court held that the Birrenbachs were not liable for rent for the months of October 2000 through and including June 2002, but that they were fully liable for the rent beginning with the month of July 2002 when the mold condition in their apartment had been fully abated. Accordingly, the clerk was directed to enter judgment for the landlord for $10,527.37, representing rent for the months of July 2002 through January 2003 at the rate of $1503.91 per month.

Comment: Although this case did not actually involve either a cooperative or condominium building, it might have and the issues would not be different. This case deals with one of the newest and hottest topics in real estate management. Mold, although arguably a less serious a hazard to most people than asbestos or lead paint, is the latest environmental hazard to receive considerable attention. Moreover, for people with severe allergies or asthma it can be a serious, even life- threatening matter. While mold has existed for centuries, there is a new awareness that water conditions in a residential building must be remediated promptly after occurrence so as to eliminate and prevent the development of mold. This requires well-managed co-op and condo buildings to establish operations and maintenance programs to deal with water conditions before they become mold problems.

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