Housing Court Decisions May 1996

edited by Colleen F. McGuire, Esq.

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New York Law Journal, decisions for the week of May 27-31, 1996

Issues/Legal Principles: Tenant in unregulated loft is Rent Stabilized
Keywords: Lofts
Caption: Tracto Equipment Corp. v. White
Court: Civil Housing Court, Kings County
Judge: Judge Mason
Date: May 29, 1996
Citation: NYLJ, page 29, col. 2
Referred Statutes: Multiple Dwelling Law Section 281(1)
Summary: Tenant had a lease from 1993 to 1995. When it expired Landlord brought a holdover based on the expiration of the lease. Tenant argued he was protected by Rent Stabilization Laws. The premises were an interim multiple dwelling, i.e., a loft, because it satisifed the three criteria: (1) 3 or more families living in residential units between 4-1-80 and 12-1-81; (2) no residentical certificate of occupancy as of 6-21-82; and (3) building was occupied at some time for manufacturing, commercial or warehouse purposes. The Tenant's unit was not occupied before 6-21-82, but the court declared he was protected by the Emergency tenant Protection Act which covered all residential housing not previously regulated by pre-existing Rent Control and Rent Stabilization guidelines in 1969. As a tenant under the ETPA, the unit is now subject to Rent Stabilization and Tenant is entitled to a renewal lease.

Issues/Legal Principles: Tenant granted discovery of Landlord to prove Rent Stabilization status of commercial unit.
Keywords: discovery
Caption: 390 West End Associates LP v. Fine
Court: Civil Court, New York County
Judge: Judge Richard Braun
Date: May 29, 1996
Citation: NYLJ, page 28, col. 2
Referred Statutes: none cited
Summary: Tenant asserted Rent Stabilized status in a commercial unit because he lived and worked there and claimed Landlord knew of his residency. Several lease renewals indicated the usage was for "Psychiatrist and Psychologist Office and for no other purpose," but a handwritten addition of "& Residence" was marked out and initialed by the parties. Landlord claimed that Tenant only had a business telephone listing, registered to vote at other addresses, and personal checks were from another address. The doorman stated that the Tenant came in the morning and left at the end of the day. The court granted Tenant's motion for discovery because Tenant showed "ample need" and the information was only within the Landlord's knowledge. Since Tenant sought favor from the Court, he was required to pay future use and occupancy.
Notes: It's very difficult for tenants in Housing Court to get discovery from landlords and court permission is needed. Discovery allows the tenant to to ask the Landlord questions under oath and obtain documents that would support their case. Without discovery, tenants walk into a trial blind, not knowing before trial what the landlord will say on the witness stand.

Issues/Legal Principles: Insufficient ties defeats succession rights claim
Keywords: succession rights
Caption: 390 West End Associates v. Wildfoerster
Court: Appellate Term, First Department
Judge: lower court: Judge Malatzky
Date: May 30, 1996
Citation: NYLJ, page 27, col. 1
Referred Statutes: RSC section 2523.5(b) & (e), 2520.6(o)(2)
Summary: The Appellate Term upheld the lower court's determination that the respondent failed to estalish succession rights to the Rent Stabilized apartment. The respondent resided with the tenant and had a personal relationship, as well as a business relationship as an employee of the tenant. However, the court found no "emotional and financial commitment and interdependence" necessary to establish a pass-on claim. They did not share household finances, formalize any legal obligations or hold themselves out as a family unit to their families, friends or the public. A dissenting judge, however, pointed out that over a period of twenty years there was evidence in the record that the two engaged in family-type activies including joint vacations, shopping and hosting dinners together and throwing birthday parties for each other. Three non-party witnesses testified for respondent that there was an emotionally committed and interdependent relationship. Respondent was apparently completely financially dependent on the tenant. The dissent would have ruled in favor of the respondent. The lower court did not deny a close relationship existed but believed it did not rise to the standard necessary for a succession rights claim.

Issues/Legal Principles: Case cannot be dismissed where merits were never adjudicated
Keywords: res judicata
Caption: Mecox Partners v. Spencer
Court: Appellate Term, First Dept.
Judge: lower court: Judge Jay Stuart Dankberg
Date: May 30, 1996
Citation: NYLJ, page 26, col. 6
Referred Statutes: Partnership Law, Article 8-A
Summary: A prior non-payment proceeding was dismissed because Landlord, a Delaware limited partnership, failed to demonstrate that it had obtained a certificate of authority to do business in New York. Landlord subsequently obtained the documents, but the lower court still dismissed the petition on grounds that an "intervening" nonpayment proceeding was previously dismissed because Landlord's local "affiliate" lacked of standing, and this prior dismissal should have barred Landlord from proceeding on the second suit (res judicata). The Appellate Term reversed and reinstated the petition, holding that the intervening non-payment was a not a disposition on the merits.

Issues/Legal Principles: Succession rights claimant fails to offer sufficient evidence to vacate stipulation to dispossess her.
Keywords: succession rights
Caption: Metropolitan Life Insurance Co. v. Ampuol
Court: Appellate Term, First Department
Judge: lower court: Judge Wilfred O'Connor
Date: May 30, 1996
Citation: NYLJ, page 27, col. 1
Referred Statutes: RSC section 2520.6(o)(2) and 2523.5(b)(1)
Summary: Landlord brought a licensee proceeding against Ampuol and the matter was settled by a stipulation which gave her ten months to vacate at the same rental as the departed tenant of record, her cousin. Tenant's efforts to vacate the stipulation were denied and her motion to renew and/or reargue the denial was also denied on grounds that she presented no new evidence and failed to demonstrate a material issue of fact to allow her succession rights claims.

Issues/Legal Principles: Occupant of co-op lacks standing to challenge legality of transfer of propriety lease to new owner
Keywords: co-op occupants
Caption: 1490 East 181st Street HDFC v. Levine
Court: Appellate Term, First Department
Judge: lower court: Judge Sheldon Halprin
Date: May 30, 1996
Citation: NYLJ, page 27, col. 1
Referred Statutes: none cited
Summary: The respondent, occupant of a co-op apartment, sought to challenge the transfer of the propriety lease as invalid, but the court ruled that the occupant lacked standing since he was not a party to the transfer. The court found that in any event the transfer was valid.

Issues/Legal Principles: Pro Se Tenant's overcharge claim set down for a hearing despite her signing stipulation of settlement
Keyswords: overcharge; stipulations
Caption: Gardon v. Almonte
Court: Civil Housing Court, New York County
Judge: Judge Maltazky
Date: May 29, 1996
Citation: NYLJ, page 28, col. 3
Referred Statutes: RSC section 2525.1
Summary: Tenant pro se entered into a stipulation to settle a non-payment petition. One year later she moved to vacate the stipulation on grounds of rent overcharge. Generally, stipulations are not vacated unless fraud, collusion, mistake, accident or other sufficient grounds exist to invalidate a contract. Courts in their discretion may look beyond the terms of a stipulation if it appears unduly harsh or unjust and the parties can be restored to their prior status. The court set the matter down for a hearing to the sole extent to determine if the rent currently charged exceeded the legal regulated rent.
Notes: It appeared from the case that the court would vacate the stipulation if the tenant could truly prove an overcharge and overcome Landlord's various documents indicating that no overcharge occurred.

Issues/Legal Principles: Landlord's knowledge that Tenant vacated apartment does not confer jurisdiction where substitute service is made on occupant of apartment
Keyswords: service of process
Caption: BN Realty Associate sv. Brummer
Court: Civil Housing Court, Bronx County
Judge: Judge Fiorella
Date: May 29, 1996
Citation: NYLJ, page 28, col. 4
Referred Statutes: none cited
Summary: A non-payment petition was served on Tenant's daughter. Her husband, Tenant's son-in-law, appeared and represented in the stipulation that he was expressly authorized to appear and act on "their" behalf, although the stipulation was silent as to whether "their" meant his wife, mother-in-law, or both. A final judgment was entered for $9,060.62. Tenant moved to vacate the stipulation on grounds that she was not properly served, never notified of the proceedings and that her son-in-law could not represent her. The stipulation was drafted by Landlord's attorney and the court found that the ambiguity must be interpreted against the drafter. Landlord garnished the Tenant's salary after judgment was entered. The court determined that the Landlord knew Tenant was no longer living in the apartment and had her business telephone number where she worked for 19 years, but never called her or served her at her place of employment, even though it was only a block away from Landlord's office. The daughter admitted that she never told her mother about the petition (due to embarrassment over the rent arrears). The court found the Tenant was never properly served. Thus she had no notice of the proceeding. The court vacated the default judgment against Tenant and dismissed the entire proceeding, and she was further granted a hearing for attorney's fees.

Issues/Legal Principles:Tenants given abatements, limited injunctive relief, punitive damages and attorney's fees
Keyswords: warranty of habitability
Caption: KEV Realty Co. v. Kelly
Court: Civil Court, New York County
Judge: Judge Saralee Evans
Date: May 31, 1996
Citation: NYLJ, page 26, col. 4
Referred Statutes: RPL 235-f; Administrative Code 27-2029 & 2031; Civil Court Act 110(a)
Summary: Landlord began 11 non-payment proceedings against various Tenants, and Tenants initiated a suit against Landlord for lack of heat and hot water. The cases were consoldiated for trial before Judge Katz. Tenants moved for appointment of a managing agent responsible for providing heat and hot water and Judge Katz ordered the Landlord to provide such services. Within weeks the Tenants claimed the agent failed to comply with the Court's order. While their motion for removal was pending, the agent resigned and a new agent was hired and Landlord cross-moved for payment of use and occupancy. Judge Katz ruled that the Tenants' motion was moot because a new agent was hired and directed Tenants to pay 60% of the use and occupancy, and that Tenants warranty of habitability claims involved questions of fact. A ten-day trial ensued before Judge Evans because Judge Katz went on maternity leave. The case details the results of the testimony, including lack of heat and hot water, breakdown in security, failure to collect garbage regularly, interference with mail delivery, removal of lights in public areas, failure to make repairs in individual apartments, reducing the work force of the building and abusive behavior toward tenants. Abatements were awarded between 25% and 60% depending on the condition and the period it lasted. Tenants further sought an injunction ordering Landlord to correct the violations, cease abusive behavior, discharge the super and hire three additional full-time building staff. The court granted most of this relief, but not the discharge of the super or making the Landlord hire additional staff. The court further awarded punitive damages of $50,000 and attorney's fees for the Tenants.

New York Law Journal, decisions for the week of May 20 through 24, 1996

Issues/Legal Principles: Management lacked authority to give tenant a lease after stipulation signed
Keywords: stipulations
Caption: City of New York v. Silva
Court: Civil Housing Court, Kings County
Judge: Judge Hoahng
Date: May 22, 1996
Citation: NYLJ, page 29, col. 2
Referred Statutes: none cited
Summary: The City terminated the tenancy on grounds of alleged narcotics activity and in a stipulation of settlement gave tenant roughly five months to vacate and a waiver of rent. Thereafter, the property manager gave tenant a lease even though their contract with the City had expired. The court ruled that the management had no authority to enter into the lease, it was not approved by the City, and no apparent authority can be imputed to a municipality. The court dismissed tenant's motion to vacate the stipulation.

Issues/Legal Principles: Tenant lacks standing to bring HP action due to surrender of apartment
Keywords: surrender standing consideration contract
Caption: Harrison v. Linus Holding Corp.
Court: Civil Housing Court, New York County
Judge: Judge Wendt
Date: May 22, 1996
Citation: NYLJ, page 26, col. 1
Referred Statutes: NYC Civ. Ct. Act section 110
Summary: After a fire Tenant brought an HP proceeding to compel Landlord to restore the premises, a rent controlled apartment, to a safe and habitable condition. Landlord argued that Tenant executed a surrender agreement of all rights to the apartment in exchange for a lease through June 30, 2016 at preferential rent of $75 a month at another apartment. Tenant argued that she had reduced mental capacity at the time she signed the surrender and it should be void as violative of the rent control laws. The court ruled that since Tenant got good consideration for the surrender, it is a legal and enforceable contract. Therefore, the Tenant had no grounds to begin an HP proceeding. The court ruled that Civil Court lacks jurisdiction to void contracts and Tenant should go to Supreme Court for that relief.

Issues/Legal Principles: Late payments by Tenant not considered nuisance
Keywords: chronic late payment
Caption: Sharp v. Norwood
Court: Appellate Division, First Department
Judge: lower court: Judge Arthur Scott
Date: May 23, 1996
Citation: NYLJ, page 25, col. 3
Referred Statutes: NYC Rent & Eviction Regulations section 2204.2(a)(2)
Summary: Rent Controlled tenant for 33 years for the past 9 years always paid her rent two weeks late, but she never accumulated arrears. The landlord brought a nuisance proceeding against her. The building went co-op, but tenant never purchased her apartment. The landlord brought a holdover against her claiming that her chronic late payments constituted a nuisance. A lower court dismissed and the Appellate Court reversed holding that a chronic late payment may constitute a nuisance if not adequately explained by the tenant. The case was remanded for a trial whereupon the lower court dismissed the petition, finding no evidence of willful, harmful or unjustified conduct on the part of the tenant rising to the level of a nuisance. The tenant's late payments were due to her ex-husband's failure to timely tender her alimony payments. The landlord appealed and the Appellate Term affirmed the petition's dismissal. The landlord appealed to the Appellate Division who upheld the dismissal. The Appellate Division noted that to prove a nuisance the landlord had to show that "it was compelled to bring numerous nonpayment proceedings within a relatively short period and that the tenant's nonpayment was willful, unjustified, without explanation, or accompanied by an intent to harass the landlord." Only two prior nonpayment proceedings were brought within the prior 15 years. The first demanded December, 1991 rent and was discontinued when the tenant paid it on December 19, 1991 before the petition was actually served, therefore landlord was not compelled to bring the proceeding. The second proceeding seeking February, 1992 rent was never litigated because the wrong party was served. The third proceeding was this holdover commenced in March, 1992. The Appellate Division found that the manner and timing in which the two proceedings was brought did not indicate a bona fide attempt by landlord to collect rent, but rather a woeful, transparent effort to accumulate a roster of non-payment proceedings in order to qualify the tenant as a nuisance. The court noted that there is no "magic number" as to how many prior non-payment proceedings would constitute a nuisance, that it is on a case by case basis.
Notes: This is an excellent case for tenants. It provides useful insight into the issue of chronic non-payments. Late paying tenants are often completely unaware that a series of non-payment proceedings can lead to a holdover where they may lose their apartment even if they are then in a position to always pay the rent on time. There was a vigorous dissent in this case so landlord will probably appeal again and take it to the Court of Appeals.

Issues/Legal Principles: Tenant given another probationary period to make timely rent payments.
Keywords: chronic late payment
Caption: Starrett City Inc. v. Dixon
Court: Civil Housing Court, Kings County
Judge: Judge Finkelstein
Date: May 22, 1996
Citation: NYLJ, page 29, col. 3
Referred Statutes: NY Civ. Court Act, section 26-521 et al
Summary: Landlord brought a holdover against Tenant based on chronic late payment of rent. The parties entered into a stipulation which placed Tenant on a probationary period. Landlord restored the proceeding to the calendar because Tenant failed to timely pay the rent for two out of four months. By the time the case was on the calendar Tenant owed no rent. Nonetheless, Landlord wanted a judgment of possession. The court noted that at the time the holdover began Tenant had paid all the rent and that subsequent payments were sent to a lockbox and may have been timely mailed if not timely received by Landlord. The court denied Landlord a judgment of possession, but extended Tenant's probation period another six months and awarded Landlord $150 attorney's fees.

Issues/Legal Principles: Sunday service of papers by mail is not unlawful
Keywords: service of process
Caption: Kyriacou v. Kangelaris
Court: District Court, Nassau County
Judge: Judge Skelos
Date: May 22, 1996
Citation: NYLJ, page 29, col. 6
Referred Statutes: RPAPL section 713(7), 735; General Business Law section 11
Summary: Landlord served a holdover alleging occupants were licensees. Respondents claimed the 10 day notice to quit was not properly served. Respondents argued there was no proof of mailing the notice and that the process server dropped them in the mail box on a Sunday in violation of General Business Law section 11. After attempting service twice, the process server placed the notice on the apartment door on a Saturday claiming the person answering the door that day refused to identify himself. He then mailed the notice by regular and certified mail the next day on a Sunday. One of the respondents picked up the certified mailing four days later. The court ruled that service on Sunday was intended to pertain to personal service on the day of rest, not mailings.
Notes: RPAPL section 735 requires mailings to be made within one day after service of process. Where conspicuous place service is made on an apartment on a Saturday, most process servers would do the mailings that day or wait until Monday and a Monday service would not be deemed to be violative of RPAPL section 735. Perhaps if this issue were placed before another judge, the mailings on Sunday would have resulted in a dismissal of the petition.

Issues/Legal Principles: Landlord gets judgment for all rent owed
Keywords: laches
Caption: GSL Enterprises v. Newlinger
Court: Appellate Term, First Department
Judge: lower court: Judge Eileen Bransten
Date: May 24, 1996
Citation: NYLJ, page 25, col. 6
Referred Statutes: none cited
Summary: In a rent strike, the lower court limited Landlord's judgment to the five most recent months of rent owed. The Appellate Term reversed finding that Landlord should have been entitled to a judgment for all rents owed. Due to an appeal in related litigation between the parties, Landlord waited until after the appeal to seek all the rents in a non-payment proceeding. The Appellate Term ruled that Landlord's forbearance or delay did not constitute laches (stale rent).
Notes: A tenant's laches defense is used when the landlord waits an unusually long period of time before bringing a non-payment proceeding. The courts have ruled that any rent deemed "stale" (at least more than 6 months) cannot be collected in Housing Court where a landlord's money judgment would be tied to possession of the premises. The landlord would have to go to Civil Court where he or she could only get a money judgment on the stale rent, not a possessory judgment. It's the tenant's burden to prove that the landlord allowed the rent to accumulate to a huge amount for the sole purpose of concocting an eviction of the tenant.

New York Law Journal, decisions for the week of May 13 through 17, 1996

Issues/Legal Principles: Tenent evicted for unlawful activity of roommate
Keywords: narcotics eviction
Caption: Pleasant East Assoc. v. Soto
Court: Appellate Division, 1st Department
Judge: lower court: Civil Court Judge Marilyn Diamond
Date: May 13, 1996
Citation: NYLJ, page 28, col. 2
Referred Statutes: RPAPL section 711(5) and section 715
Summary: The appellate courts found sufficient evidence to support the jury's finding that tenant had knowledge and had acquiesced in the sale of narcotics at the apartment. By its finding the jury rejected tenant's testimony that she was unaware of drug activity which she attributed to her husband. The court ordered tenant's eviction.

Issues/Legal Principles: building is not exempted from Rent Stabilization status
Keywords: Not-for-Profit landlord
Caption: Greater Mt. Pleasant Baptist Church v. Sandiford
Court: Civil Housing Court, Kings County
Judge: Judge Baynes
Date: May 15, 1996
Citation: NYLJ, page 27, col. 6
Referred Statutes: RSC section 2520.11(j)
Summary: In a non-payment proceeding, the landlord, a religious corporation, claimed the premises were exempt from Rent Stabilization because the building is operated exclusively for charitable purposes on a nonprofit basis. The tenants resided in the building for 12-17 years and until 1993 always had rent stabilized leases. The court first noted that simply because the landlord is a religious organization does not per se exempt its property from Rent Stabilization. The court examined the standards for such an exemption: whether the building's use is "primarily" charitable and whether the income derived from the property is devoted exclusively for charitable purposes. Thus, the entire building's use must be examined, rather than the character of the owner. The court determined that the landlord used less than 25% of the building for a soup kitchen and education usages on a periodic basis, thus it was not primary. Rather, such charitable usages were deemed "relatively incidental" to its primary purpose of generating income for the landlord's "lawful and indeed commendable, ecclesiastical activities."

Issues/Legal Principles: Criminal Court order of protection prohibiting one occupant from entering apartment does not constitute illegal lock-out by other occupant who changes the locks.
Keywords: illegal lock-out
Caption: Bowie v. Sentell
Court: Civil Housing Court, Kings County
Judge: Judge Callendar
Date: May 15, 1996
Citation: NYLJ, page 28, col. 3
Referred Statutes: NY Civ. Court Act, section 26-521 et al
Summary: Petitioner secured an order to show cause on January 23, 1996 claiming he was forcibly and unlawfully evicted and kept out of the premises where he had lived for 18 years, that the locks were changed and his possessions disposed of by respondent, his lover. Respondent, however, had previously filed a complaint against petitioner for threatening and menacing her which led to petitioner's arrest on January 6th. He was held in jail until January 12th. On January 6th, petitioner was served an order of protection from the Criminal Court which prohibited him from going near respondent or entering the home. Petitioner argued that the order of protection was obtained by the deceitful behavior of respondent. The Housing Court judge ruled that the Criminal Court order of protection precluding him from entering the home does not constitute an unlawful lock-out as defined by the statute. The judge ruled that respondent obtained a lawful court order and that such a court order does not trigger an unlawful lock-out. The court dismissed the petitioner's order to show cause for restoration to the apartment and ruled that he could not bring another until the order of protection is vacated.
Notes: The case doesn't state who is the tenant of record in this apartment. Women who obtain orders of protection against their male partners who engage in domestic violence against them often encounter difficulties if the man is also, or is the only, tenant of record. The court might have reached a different conclusion if this were the case. However, by not mentioning this, perhaps the man was a lawful tenant, and the judge ruled for the woman anyway regardless of either's status.

Issues/Legal Principles: Landlord must serve new "Golub" notice.
Keywords: owner occupancy
Caption: Wilczewski v. Mercado
Court: Civil Housing Court, Kings County
Judge: Judge Finkelstein
Date: May 15, 1996
Citation: NYLJ, page 28, col. 2
Referred Statutes: RSC section 2524.4(a)(1)
Summary: Landlord served a "Golub" notice that the lease would not be renewed on grounds the landlord wanted to recover the apartment for her own use. The holdover proceeding was dismissed for improper service. The landlord brought a second holdover using the same, original Golub notice. The court ruled that a new Golub notice must be served because the original pertained to the first holdover which was now defunct, thereby making the notice invalid, too. The result is that the landlord must tender the tenant a new lease. Upon its expiration the landlord can then send a new Golub notice and begin another holdover proceeding. The court recognized the possible unfairness to the landlord in having to wait another year or two to commence such a proceeding, but stated that the landlord's recourse is to appeal to the legislature to change the law.

Issues/Legal Principles: Trial needed to determine who pays electric bills.
Keywords: proprietary leases
Caption: 3299 Cambridge Apt. Corp. v. Rosenbaum
Court: Civil Housing Court, Bronx County
Judge: K. Smith
Date: May 15, 1996
Citation: NYLJ, page 26, col. 4
Referred Statutes: none cited
Summary: Landlord, a co-op, sued the tenant shareholder for unpaid electric bills in the amount of $26,371.15 for the past 6 years. Tenants took possession of Apartment 8H as rent stabilized tenants and their lease provided that the gas and electric would be paid by the landlord. In 1984, the tenants purchased the co-op unit. In 1994 or 1995, the co-op learned that two apartments in the building were not separately metered and the co-op was paying for usage all these years. The tenants refused to install a separate meter or pay electric charges for their unit. The co-op installed a separate anyway and charged the tenants for the payments the co-op made to Con Ed. The proprietary lease was silent or ambiguous as to who was responsible to pay electricity in individual apartments. The offering plan, however, had various contradictions as to who pays for the service. Both parties moved for summary judgment, i.e., that there are no facts in dispute and the issue should be decided on the law only. The court ruled that the facts were inconsistent and a trial was required to flesh out the ambiguities and contradictions. The tenants also claimed that electrical charges are not "rent" therefore landlord should not have brought a non-payment proceeding. The court ruled this was also a matter for trial since it requires an interpretation of the proprietary lease.

Issues/Legal Principles: Tenant must pay rent where condo unit's owner lost apartment in a foreclosure
Keyswords: condominiums
Caption: Foxwood Square Condominium I v. Albert
Court: Civil Court, Richmond County
Judge: Judge Maltese
Date: May 15, 1996
Citation: NYLJ, page 28, col. 6
Referred Statutes General Business Law 353-e(2)(d)
Summary: The condo board sued the tenant-in-possession in a plenary proceeding (non-Housing Court) for common charges (rent, late fees, etc.) which the unit's owner failed to pay. The owner filed for bankruptcy and was discharged from its debts in 1992. The condo board demanded rent payments from the tenant. The tenant paid a $750 rent to the owner pursuant to a lease which incorporated the condo's bylaws. Failure to comply with the bylaws was deemed a default of the tenant's lease. The tenant paid rent till 1992 and then the unit owner informed her he would no longer accept rent because he was in bankruptcy. The security deposit was returned to her but the check bounced. The tenant's lease allowed her to stay until the apartment was sold. The tenant claims she was informed by the management that she would not be responsible late fees charged to the owner. In reliance on case law and General Business Law, the court ruled that just because the owner walked away from the condo unit does not mean that the tenant left in possession did not have to pay any rent. The court ordered the tenant to pay all the rent due and future rent until such time as she is evicted.

New York Law Journal, decisions for the week of May 6 through 10, 1996

Issues/Legal Principles: Landlord's time expired for purchase of Loft tenant's improvements
Keywords: fixture fees
Caption: Ross v. Wolfe
Court: Appellate Division, 1st Department
Judge: lower court: Supreme Court Judge Emily J. Goodman
Date: May 6, 1996
Citation: NYLJ, page 29, col. 3
Referred Statutes: Loft Board regulations Section 2-07
Summary: The plaintiff tenant lived in a loft and sought to sell the improvements to an incoming tenant. Under the loft law, once a tenant offers the fixtures for sale the owner has 20 days to either match the offer or challenge their fair market value in a proceeding before the Loft Board. This landlord failed to act within the statutory time period. The result is that the owner must accept the incoming tenant and the sale to that person. The lower court granted tenant's motion to sell the improvements to the incoming tenant and the Appellate Division affirmed.
Notes: Brief history of Loft Law. When landlords began renting commercial warehouses to tenants, frequently to artists, the conditions of the spaces were not set up for residential usage. In exchange for a cheap rent, the tenant was obliged to install fixtures and improvements to make the premises habitable. Often tenants invested thousands of dollars in improvements to their spaces. Later when the real estate market escalated, landlords tried to evict the tenants as if they had a mere commercial lease, and no residential tenant rights. To protect the tenants and to limit an unjust enrichment by landlords, the legislature passed the Loft Law. One of its provisions, the one pertinent to the above case, allowed the tenant who made the investments to sell the fixtures. There is only a one-time fixture fee for any loft. No subsequent tenants are permitted to sell any fixtures installed by them.

Issues/Legal Principles: Overcharges collectible where in foreclosure landlord given assignment of rent
Keywords: overcharges stipulations
Caption: Hollis Gardens Realty Corp. v. Charles
Court: Civil Housing Court, Queens County
Judge: Harriet George
Date: May 8, 1996
Citation: NYLJ, page 32, col. 2
Referred Statutes: RSC sec. 2526.1(f)(2)
Summary: In a non-payment proceeding, the parties' stipulation of settlement granted landlord a final judgment for $2,269.75. Tenant moved to modify the stipulation on two grounds. The tenant argued that the stipulation did not cover tenant's overcharges. RSC sec. 2526.1(f)(2) provides that where an owner acquires the building in a judicial sale, the current owner is only liable for overcharges it made, not to its predecessor's overcharges. The rationale is to protect a potential purchaser who is unable to secure and investigate, at the time of the foreclosure, records that would establish the legal rent. The court therefore denied tenant's request for overcharges against the current owner. As to the prior rents, the landlord had an assignment of rents from its predecessor and sued to collect them, while simultaneously asserted a statutory protection from overcharges. The court disagreed and allowed the tenant reimbursement of the overcharges of the rents assigned on grounds that an assignee stands in the shoes of an assignor and assumes all conditions and liabilities of the assignor. The court relied on case law for its holding because RSC sec. 2526.1(f)(2) was silent on the issue of assigned rents. The second ground relied upon by tenant for modifying the stipulation pertained to a rent reduction order by the DHCR which was not taken into account when the stipulation was signed. The court concluded that the stipulation's cited rent was a mistake, and mistake is one of the conditions that courts may allow when considering a request to modify or vacate an agreement.

Issues/Legal Principles: Court defers to DHCR to determine required service issues, but orders 24-hour doormen or accessible intercoms in the interim
Keywords: required services
Caption: Principe v. Jemrock Realty Co.
Court: Civil Housing Court, New York County
Judge: Peter Wendt
Date: May 8, 1996
Citation: NYLJ, page 29, col. 6
Referred Statutes: NY Civ. Court Act, sec. 110(a)
Summary: In a companion case, the Appellate Division issued an order requiring manual elevator service pending a DHCR decision on this issue. The owners then removed the building's lobby attendant between the hours of 12:30 am and 9:00 am. In an HP proceeding, the tenants sought restoration of the lobby attendant because the intercom is located outside the locked vestibule doors and without an attendant present only persons having keys could enter the building. This could be dangerous if, for example, the police, medical personnel or firefighters had to enter the building in an emergency. Much of the court's time was spent on landlord's motion to dismiss on grounds that only the DHCR could decide this issue. The court concluded that the agency was better suited for determining the ultimate issue regarding exactly which personnel the landlord is required to maintain in the building and directed the tenants to file a complaint with the DHCR in that regard. However, pending the DHCR's determination, the court ruled that it had jurisdiction to determine housing standards and that in the interim the landlord was ordered to either provide 24-hour lobby service or move the intercom system to an accessible site.

Issues/Legal Principles: Landlord is "prevailing party" entitled to attorney's fees.
Keywords: attorney's fees
Caption: Excelsior 57th Corp. v. Winters
Court: Appellate Division, First Department
Judge: lower court: Judge James Grayshaw
Date: May 9, 1996
Citation: NYLJ, page 26, col. 5
Referred Statutes: none cited
Summary: Landlord brought a non-payment petition against tenants for 54 months rent. Tenants counterclaimed on grounds of constructive eviction and warranty of habitability for 24 of those months. The civil court and appellate term determined that the tenants were entitled only to a rent abatement of some 4 months. The lower court awarded landlord attorney's fees as the "prevailing party." The appellate term reversed, holding that the tenants were entitled to attorney's fees. The Appellate Division reversed and reinstated the lower court's holding granting the landlord attorney fees. The Court noted a determination requires a considertaion of the true scope of the dispute litigated, followed by a comparison of what was achieved within that scope. In the Appellate Division's assessment landlord was the ultimate "prevailing party."
Notes: 4 months abated rent out of 24 months requested amounts to an abatement of roughly 16%. That is not an unusual abatement award in Housing Court. In Bunny Realty v. Miller 579 N.Y.S.2d 952 (App. Division, 1st Dept. 1992), the Appellate Division reinstated an attorney's fees award to the various tenants whose warranty of habitability claims varied from 15% to 49%, and 15% and 20% awarded in F&B Heller v. Morgan, NYLJ, 6-3-92, 22:1. There appears to be no hard and fast rule as to a percentage that would trigger a determination of who is the "prevailing party" so as to be entitled to an award of attorney's fees. It's a case by case basis, and in reality that means much depends on which judge hears the case.

New York Law Journal, decisions for the week of April 29 to May 3, 1996

Issues/Legal Principles: Attorney's fees award too excessive
Keywords Attorney's fees, unlawful alterations
Caption: Sklar v. Weidenaar
Court: Appellate Term, 1st Department
Judge: lower court: James Grayshaw
Date: May 1, 1996
Citation: NYLJ, page 30, col. 2
Referred Statutes: none cited
Summary: Landlord proved at trial that tenant had violated a substantial obligation of the rent stabilized lease by making unlawful alterations and was awarded attorney's fees. The Appellate Term concluded that in "consideration of the nature and extent of the legal services rendered and the results achieved" the legal fees awarded to landlord as the prevailing party were too excessive.

Issues/Legal Principles: Process server; properly served legal papers
Keywords: Traverse
Caption: Park Holding Company v. Adler
Court: Appellate Term, 1st Department
Judge: lower court: Margaret Taylor
Date: May 1, 1996
Citation: NYLJ, page 30, col. 2
Referred Statutes: RPAPL 735
Summary: The process server's affidavit of service indicated that the legal papers were affixed to the apartment entrance door. At trial, however, the process server testified that he placed the papers under the door. The lower court dismissed the petition for improper service on this ground. The Appellate Term reversed, finding that the process server's testimony and documentation constituted good service.

Issues/Legal Principles: Good faith by landlord in owner occupancy proceeding
Keywords: owner occupancy
Caption: Delorenzo v. Famiglietti
Court: Appellate Term, 1st Department
Judge: lower court: Jerald Klein
Date: May 1, 1996
Citation: NYLJ, page 30, col. 3
Referred Statutes: RSC 2524.4(a)(1)
Summary: Owner sought tenant's apartment for use for owner's son, wife and two children. The lower court dismissed the petition on grounds that landlord failed to demonstrate a good faith intention to recover the apartment on two grounds. The apartment was a duplex unit, the top floor a basement, the bottom floor a cellar. Notwithstanding the tenants' residency in the duplex since 1979, the certificate of occupancy limited residential usage only to the top floor. The Appellate Term reversed finding that this ground does not support a finding of lack of good faith, explaining that a landlord need only show that he or she seeks to recover the apartment for their personal and/or family use. The lower court also held the proceeding was not brought in good faith since there were other vacant apartments available in the building. The Appellate Term disagreed on this ground as well. The Court sent the case back to the lower court for a hearing on Landlord's attorney's fees as the prevailing party.

Issues/Legal Principles: No retaliatory eviction defense for personal injury action against landlord
Keywords: retaliatory eviction
Caption: Weil v. Kaplan
Court: Civil Court, Nassau County
Judge: Judge Skelos
Date: May 1, 1996
Citation: NYLJ, page 33, col. 6
Referred Statutes: RPL 223-b
Summary: A holdover was brought against month-to-month tenants living in a two story building. Tenants counterclaimed for retaliatory eviction because the tenant was injured in the premises in August, filed a personal injury action against the landlord in October and the landlord sent a notice of termination in November. The court ruled that the retaliatory eviction statute was designed to protect tenants who filed complaints of code violations against the landlord. The statute was intended to encourage tenants to report health, safety and housing code violations without fear of facing eviction. The court ruled that retaliatory eviction is not an available defense in an eviction proceeding on grounds of a personal injury lawsuit brought against an owner. Also, the statute only pertained to tenants in buildings of four or more units.
Notes: If the tenant was injured in the apartment, seemingly the cause was due to some violation of the tenant's health and safety or housing code. Perhaps this tenant never made any complaints to a governmental agency concerning whatever it was that injured the tenant. Such a complaint is a prerequisite to a defense of retaliatory eviction.

Issues/Legal Principles: Landlord denied traverse in contempt proceeding
Keywords: traverse
Caption: Dept. of Dept. of Housing Preservation & Development v. Warchak
Court: Civil Court, Bronx County
Judge: Anthony Fiorella
Date: May 1, 1996
Citation: NYLJ, page 32, col. 1
Referred Statutes: CPLR 308
Summary: Landlord violated a prior consent order which required the owner to provide heat and hot water to the tenants. DHPD served an order to show cause for civil and criminal contempt. The landlord's attorney initially failed to answer the show cause, but the court granted an extension of time to file a late answer. In the answer the landlord claimed that she never received the motion by personal service, only by mail. The process server's affidavit of service indicates four attempts to serve the landlord. The landlord sought to dismiss the motion solely on grounds that she was not personally served. The court found that the landlord had sufficient due process: notice of the hearing and opportunity to be heard. The court noted that the landlord appeared on each and every occasion before her late answer was served, thereby showing that she had notice. The court ruled that there is no absolute requirement that one facing contempt must be served by personal service only. The court found that in this case due process was accomplished and denied the landlord's application to dismiss the contempt motion.

Issues/Legal Principles: Assignment of proprietary lease deemed invalid
Keyswords: Assignment
Caption: 142 East 49th Street Owners Corp. v. Rivas
Court: Civil Court, New York County
Judge: Judge Mills
Date: May 1, 1996
Citation: NYLJ, page 31, col. 3
Referred Statutes: none cited
Summary: Defendant was assigned the proprietary lease to a co-op apartment by paying $1.00 consideration with the full purchase price to be paid later. The defendant never paid the purchase price and never lived in the unit. The apartment was occupied by a life tenant. The plaintiff, the co-operative corporation, sued defendant for unpaid maintenance (i.e., rent). The defendant failed to pay maintenance and surrendered her shares to the apartment. The plaintiff purchased the shares for $10.00 at an auction. The plaintiff then sued defendant for the unpaid maintenance. The tenant in possession paid both parties rent on different occasions. The court ruled that the assignment was invalid because it never made clear reference to the fact that a life tenant lived in the apartment. The court found that the tenant signed the assignment without full knowledge that the premises were occupied for life by someone else. The court dismissed plaintiff's action for maintenance payments on grounds that the assignment as drafted was defective and entered into by defendant under mistaken beliefs.

Issues/Legal Principles: Notices not properly served on co-op tenant
Keyswords: notice to cure
Caption: Troiano v. 55 Ehrbar Tenants Corp.
Court: Supreme Court, Nassau County
Judge: Justice Feuerstein
Date: May 1, 1996
Citation: NYLJ, page 33, col. 3
Referred Statutes: none cited
Summary: Plaintiff is the proprietary leaseholder to a co-op apartment purchased in 1991. In 1992 Plaintiff sublet the apartment for a $1,000 sublet fee to the co-op. The defendant co-op argued that the sublet fee is an annual fee and that plaintiff failed to pay the fee for the years 1993 and 1994. The co-op served plaintiff a notice of termination for failure to pay $2,000.00 after a notice to cure was served. Plaintiff denied receipt of the notice of cure and continued to pay monthly maintenance. When the co-op served a second notice of termination the Plaintiff sought a declaratory judgment that there had been no default to justify terminating his lease. The court did not reach the issue of whether the sublet fee was a one-time fee or whether plaintiff should pay it annually. The court granted plaintiff's motion only to the extent of not allowing the co-op to proceed on the notices because they were defective. The co-op was forced to start a new proceeding with new notices served in accord with the lease provisions.

Issues/Legal Principles:
Keyswords: Caption: Ieraci v. Gerez
Court: Appellate Term, 2nd & 11th Judicial Districts
Judge: lower court: Judith Gische
Date: April 29, 1996
Citation: NYLJ, page 30, col. 4
Referred Statutes: none cited
Summary: At trial the court awarded tenant a 33% abatement, leaving a balance due in rent of $3,143.01. The matter was set down for a hearing on attorney's fees due tenant. The landlord did not appear for the fees hearing and tenant won a default judgment of $8,070 in attorney's fees. Landlord moved to vacate the default judgment, but the court denied it for failure to show a reasonable excuse for the nonappearance and lack of a meritorious defense regarding the fees hearing. The landlord appealed. The Appellate court found the abatement proper and rejected the landlord's argument that the judge should have specified the monetary or percentage amount attributable in the abatement to each condition. The Appellate court did, however, reverse the lower court's award of attorney's fees. The court held that since the landlord sued for roughly $4,700 in back rent and the abatement was only $1500 (33%), counsel fees "should be limited to 33% of the time spent" by tenant's attorney and that anything higher should not create a windfall for the tenant.
Notes: The standard for the amount of attorney's fees recoverable by a tenant in an abatement case should not be based on the amount of the abatement. Landlords have more resources than tenants and can pay their lawyers to be unduly obstreperous, such as making unnecessary motions, just to get the tenant to give in and settle. A tenant whose attorney does not give in, but rather continues to fight for a just outcome should be reimbursed for the work performed that led to the result. This case does not bode well for tenants.

Issues/Legal Principles: No interest given on security deposit
Keyswords: security deposit
Caption: Williams v. Brand
Court: Appellate Term, 9th & 10th Judicial Districts
Judge: lower court: E.S. Shapiro
Date: May 3, 1996
Citation: NYLJ, page 32, col. 3
Referred Statutes: none cited
Summary: Plaintiff tenant sued for a return of the security deposit with interest. The lower court granted plaintiff 3% interest. The Appellate Court reversed on grounds that the premises did not contain six or more family units. Therefore, the landlord was not legally obligated to pay interest. Also, the deposit was never placed in an interest bearing account, so the the landlord didn't make any interest off the tenant. Finally, the oral rental agreement did not include interest on the security deposit.

Issues/Legal Principles: Overcharge treble damages only in trial; not summary judgment motion
Keyswords: overcharge
Caption: 11 Jones Street Associates v. Orbach
Court: Appellate Term, 1st Department
Judge: lower court: Margaret Taylor
Date: May 3, 1996
Citation: NYLJ, page 29, col. 2
Referred Statutes: RSL 26-516(a) and 26-517(e)
Summary: Tenant won summary judgment motion for rent overcharge because it was undisputed that landlord failed to file initial or annual rent registrations. Since there was no initial registration in 1984 or later when the apartment became decontrolled (i.e., went from rent control to rent stabilization), the legal rent rate became the last rent charged under rent control. Since landlord offered no proof that late registrations were filed, landlord could not invoke the Rent Regulation Reform Act of 1993 which excuses landlords from overcharge claims up to the point the late registration is filed. The Appellate Court, however, reversed the lower court on the issue of treble damages. A tenant must prove that the overcharges were willful, and tenants motion papers failed to do this. The Court ruled that treble damages are not automatically given, but must be proven.

Issues/Legal Principles: Rent Control gay life partner establishes succession rights
Keyswords: succession rights
Caption: Classic Properties v. Martinez
Court: Appellate Term, 1st Department
Judge: lower court: Wilfred O'Connor
Date: May 3, 1996
Citation: NYLJ, page 29, col. 2
Referred Statutes: NYC Rent Regulations Section 2204.6(d)(3)
Summary: The lower court denied the tenant's cross-motion for summary judgment that he is entitled to succeed to the statutory tenancy of the deceased rent control tenant. The Appellate Term found that the tenant's papers satisfactorily showed that he had an ongoing and committed family-type relationship with his deceased partner for over twenty years. The evidence included photos, intimate correspondence, joint celebration of holidays and family functions, world travel together, sharing of credit cards, naming each other as beneficiaries and executors of each other's will, life insurance beneficiary, and executing a City of New York Affidavit of Domestic Partnership. Numerous affidavits, including one from a federal judge, attested to the close relationship and that the two held themselves out as a couple and were treated as such in the community. The lower court denied the motion because the tenant had not included proof of a joint bank account. The Appellate Court, however, referred to the statute's language that "no single factor shall be solely determinative" to establish succession rights by unmarried partners. The Court noted that the evidence was voluminous and not meaningfully opposed by the landlord.
Notes: Usually, it is very difficult to establish succession rights on a mere motion alone. Usually, a trial is necessary. This tenant, however, produced an overwhelming amount of evidence indicating an emotional and financial interdependence over a 20-year period.