Justice Paul Wooten
The Bakers, tenant-shareholders in a residential cooperative building, brought an action against the co-op corporation and the building’s managing agent to recover for severe water leaks that allegedly rendered their unit uninhabitable for extended periods. Penmark Realty Corporation, the building’s former managing agent, maintained that between 2004 and 2008 it hired five engineering experts and weatherproofing contractors who performed work on the exterior of the Bakers’ unit. Penmark argued that the Bakers cannot establish that this response to the water intrusions constituted gross negligence. The Bakers asserted that, nine years after they began this action, the facade draining system is still allowing water into their unit. The court found no evidence that Penmark’s actions smacked of intentional wrongdoing or evidenced a reckless indifference to the Bakers’ rights. It noted that in addition to hiring the engineering experts and weatherproofing contractors, Penmark approved the retention of four contractors for testing, remediation, and renovation of the interior of the apartment. The court thus dismissed the gross negligence and punitive damages actions against Penmark.