A dispute between owners of the nine-story One Niagara building on Rainbow Boulevard will be shuttled to a state judge who is already handling a nearly 3-year-old lawsuit between the partners.
State Supreme Court Justice Ralph A. Boniello III ruled Friday that a request to compel co-owner Frank Parlato Jr. to pay back property taxes on the building at 360 Rainbow Blvd. before it lands on a city foreclosure list is related to "various managerial issues" already before State Supreme Court Justice Frank Caruso.
"Although the court does not condone the unorthodox management style of Mr. Parlato, which may result in an in-rem tax foreclosure, the defendants assert that they have a strategy worked out which they can implement under their managerial discretion free from interference from the plaintiff," Boniello wrote.
Boniello transferred the latest lawsuit to Caruso and canceled a temporary restraining order he had issued earlier this month.
Incredible Investments Limited, a company that has half ownership in One Niagara, had sought a court order from Boniello to either make Parlato pay the back taxes or appoint a receiver for 60 days who would ensure the building isn't lost to tax foreclosure.
B. Kevin Burke Jr., an attorney for Incredible Investments, said he plans to take the same request to Caruso on Monday.
"To me, it makes absolutely no difference which judge gives us the relief just as long as the judge gives us the relief as soon as possible," Burke said.
Burke has warned that the property could end up on the city's in-rem foreclosure list unless $476,017 in back property taxes owed for 2006 and 2007 on the building are paid. The total property taxes currently owed on the property are $1.57 million.
"Every day that goes by without these issues being resolved puts my client at further risk," Burke said.
But attorneys for Parlato, the building's managing partner, told Boniello on Wednesday that they have a "strategy" for dealing with the back taxes that they do not want to reveal publicly. They insisted Parlato will not lose the property to tax foreclosure.
"It's the right decision," attorney Paul Grenga said of Boniello's ruling. "And it's unfortunate that this crazy action was such a waste of the court's time and legal fees."
Grenga said he believes Incredible Investment's chances of getting Caruso to appoint a receiver for the building are "nil."
"They're not entitled to it," Grenga said. "They've asked for it multiple times and been denied."
Parlato's company, Whitestar Development Corp., and Incredible Investments have co-owned the building since late 2004, when they struck a deal for Parlato to operate and manage it.
At the time, the building, which once housed offices for Occidental Chemical, was nearly empty and had a 40-foot hole on-site -- the failed project to build an underground aquarium.
Since then, Parlato has reopened the first and ninth floors and a paid parking lot on the site. But the partnership between Parlato and Incredible Investments has soured, and the two sides have been in court since 2007 battling over the building's management.
Parlato sued Incredible Investments in 2007, asking Caruso to stop the company from interfering his management of the building. That lawsuit remains before Caruso.