Matter of Waldbaum v. City of New York

In Matter of Waldbaum v. City of New York, 74 N.Y.2d 128, 542 N.E.2d 1078, 544 N.Y.S.2d 561 (1989), petitioner, a fractional lessee commenced a tax challenge with respect to its leasehold, a substantial portion of a shopping center. The lease did not obligate the petitioner to pay the property taxes, although its rent was subject to increase based on a pro rata share of the tax increases for the parcel as a whole. Upon a motion to dismiss for lack of standing, the trial court, and the Appellate Division, both found that petitioner was an aggrieved party. The Court of Appeals, however, reversed, finding that a fractional lessee lacks standing to bring a tax challenge unless it either has an express grant of authority under the lease to commence such proceedings, or unless it is required to directly pay the taxes on the entire parcel, and, in either instance, unless the tax assessment also has a direct and adverse effect on the lessee's pecuniary interests.