Housing Court Decisions September 97

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Case Caption:

Matter of Ho and He Properties v. State of New York

Issues/Legal Principles:

Article 78 proceeding to challenge a DHCR PAR decision must be brought within 60 days after the decision is received by the aggrieved party

Keywords:

Article 78, statute of limitations

Court:

Supreme Court, Bronx County

Judge:

Hon. Suarez

Date:

September 15, 1997

Citation:

NYLJ, page 7, col 2

Referred Statutes:

CPLR 217; City Admin. Code Section 26-516(d); RSC 2530.1 & 2529.8

Summary:

Landlord commenced an Article 78 proceeding to challenge a DHCR PAR decision four months after receiving the decision, on the grounds that the statute of limitations set forth in CPLR Section 217 applies. However, the 60 day statute of limitations set forth in RSL Section 26-516(d) and RSC Section 2530.1 applies. CPLR Section 217 specifically states that a proceeding against a body must be commenced within four months, unless a shorter time is provided in the law authorizing the proceeding. The law authorizing the proceeding is RSL Section 26-516(d) and RSC Section 2530.1. The court also noted that RSC Section 2529.8 provides that when a person elects to forego a PAR determination ("deemed denial"), they may commence an Article 78 proceeding 60 days after the expiration of 90 days from the filing of the PAR.

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Case Caption:

Ariel Assocs. LLC v. Brown

Issues/Legal Principles:

Loft tenant who overcharges subtenants cannot be evicted if landlord fails to serve a notice to cure.

Keywords:

lofts; subtenants; overcharge

Court:

Civil Court, New York County

Judge:

Hon. Marcy Friedman

Date:

September 18, 1997

Citation:

NYLJ, page 29, col 5

Referred Statutes:

Multiple Dwelling Law 286; 29 RCNY Sections 2-09(c)(4)(i) and (ii)(A)-(G) & 2-08(j); RPAPL 753(4), 711, & 713; RPL 226-b; Admin. Code of the City of New York Section 26- 501; RSC 2525.6(b) & 2524.6(f)

Summary:

Petitioner-landlord served respondents-tenants with a notice of termination of tenancy on the basis that they committed rent-gouging by charging their subtenants rent in excess of the legally allowable rent. Landlord then commenced this holdover (eviction) proceeding on the basis that the tenancy had been terminated. The Judge noted the absence of case law on this issue, reviewed the Loft Law and the implementing Loft Law Regulations, and found that there is no statutory basis authorizing an eviction of loft tenants based on the charging of illegal rents for subleases. The Loft Board's regulations permit eviction of covered tenants for nonprimary residence, nuisance and any grounds permitted by the Real Property Actions and Proceeding Law (RPAPL). The RPAPL does not set forth any ground for eviction related to subletting or rent overcharging. The Judge concluded that there were "serious questions" about whether profiteering in subleases may be a ground for eviction of a loft tenant. The Judge avoided deciding this issue by concluding that "the allegations of profiteering in the instant case are insufficient as a matter of law to warrant a forfeiture of the tenancy without an opportunity to cure." Although the Judge noted that the charging of illegal rents is deplorable, under the circumstances of this case, the tenants had sublet for three summers, for a month each, over a four year period. The Judge found that this behavior did not "rise to the level of profiteering which warrants the forfeiture of respondents' long term tenancy without a prior notice to cure." The Judge denied the tenants' counterclaims for the imposition of sanctions finding that the landlord's commencement of the holdover proceeding was not frivolous because of the apparent lack of any legal precedent on this issue. For the same reason, the Judge, exercising her discretion, denied the tenants' request for an award of attorneys' fees. If there is a lease provision providing for attorneys' fees, they are generally awarded to the prevailing party. However, the court has discretion to deny counsel fees to the prevailing part "where unfairness is manifest."

Notes:

The Judge's decision includes an excellent discussion of holdover cases which raised similar issues: Continental Towers Ltd. Partnership v. Freuman (128 Misc 2d 680 (App. Term, 1st Dept. 1985) (post judgment cure provision of RPAPL 753(4) is inapplicable in a holdover proceeding brought against a rent stabilized prime tenant who had charged the subtenant rent in excess of one hundred percent of the legal regulated rent, and who had procured the landlord's consent to the sublease based on the misrepresentation that only the legal rent would be charged); 125 E. 31st St. Rlty. Co. v. Watts, NYLJ, 11/27/87, p.14, col. 1 (App. Term, 1st Dept.) (there is a cause of action to evict prime tenants of rent stabilized and rent controlled apartments based on profiteering in the rentals charged for subleases); 520 E. 81st St. Assocs. v. Roughton-Hester, 157 AD2d 199 (App. Div. lst Dept. 1990) (there is no cause of action to evict a prime tenant of a rent stabilized apartment for profiteering in the rental charged a roommate as opposed to a subtenant; the court refused to extend the holding in Continental Towers to this situation).

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Case Caption:

Bims Realty Corp. v. Durham

Issues/Legal Principles:

Cousin is not family member under succession rights law and she also failed to prove financial interdependence with deceased tenant of record

Keywords:

succession rights

Court:

Appellate Term, Second Department

Judge:

lower court: Hon.

Date:

September 18, 1997

Citation:

NYLJ, page 30, col 2

Referred Statutes:

RSC 2520.6(o) and 2523.5(b)(1)

Summary:

The trial court found that occupant was entitled to succession rights and the Appellate Term reversed. Rent Stabilization Code Section 2520.6(o) paragraph (1) lists the various family members who are entitled to succession and the law does not include "cousin" on the list. Rent Stabilization Code Section 2520.6(o) paragraph (2) states that an occupant is entitled to succession if the occupant could show an emotional and financial commitment and interdependence between the occupant and the tenant of record. (These standards were set forth in Braschi v. Stahl Assoc. Co., 74 NY2d 201). Although the occupant performed errands for her deceased cousin, cooked for him and visited him when he was sick in the hospital, she admitted that "her money was hers and his money was his." Since there was clearly no financial commitment and interdependence between the deceased tenant and the occupant, the occupant was not entitled to succession rights. Therefore, the Appellate Term reversed the trial court's decision.

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Case Caption:

Williams v. Kassim

Issues/Legal Principles:

Court is not allowed refuse to issue a warrant of eviction by making landlord take actions not specified by statute.

Keywords:

warrants

Court:

Appellate Term, First Department

Judge:

lower court: Hon. Saralee Evans

Date:

September 19, 1997

Citation:

NYLJ, page 25, col 3

Referred Statutes:

RPAPL 732(3)

Summary:

Tenant defaulted in a nonpayment proceeding and landlord applied for a warrant of eviction, submitting all his documentary evidence. The court granted the landlord a judgment of possession, but conditioned issuance of the warrant of eviction on landlord's service on tenant of a copy of the judgment. The Appellate Term reversed and held that there is no mailing service requirement and that the lower court had no authority to "fashion additional, individualized protections [for tenants] upsetting the legislative scheme."

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Case Caption:

GMAC Mortgage Corp. v. Carney

Issues/Legal Principles:

Landlord cannot amend judgment to obtain rent accrued after the trial date.

Keywords:

judgments

Court:

Appellate Term, Second Department

Judge:

lower court: Hon. Rodriguez

Date:

September 23, 1997

Citation:

NYLJ, page 29, col 3

Referred Statutes:

none cited

Summary:

Landlord appeals from the lower court's order which denied landlord's motion to amend the judgment to include unpaid use and occupancy accruing subsequent to the judgment. The decision of the lower court is affirmed. Pleadings can be amended to include claims that came into existence after the pleadings were served. However pleadings cannot be amended to include claims that were not in existence at the time of trial. A judgment brings a controversy up to date through the time of trial. A judgment can only be amended as to defects or irregularities.

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Case Caption:

Talos 232 LLC v. Pena

Issues/Legal Principles:

Tenant not entitled to attorney's fees where landlord brought action in good faith and where rental dispute is still pending at DHCR

Keywords:

attorney's fees

Court:

Civil Housing Court, Bronx County

Judge:

Hon. Heymann

Date:

September 24, 1997

Citation:

NYLJ, page 27, col 6

Referred Statutes:

RPL 234

Summary:

Petitioner/landlord commenced a non-payment proceeding based on a monthly rental of $714. In defense, respondent-tenant referred to a stipulation tenant entered into with former landlord which limited rent to $445 pending DHCR's decision as to the legal regulated rent. Petitioner represented that it was unaware of the stipulation and that the former landlord had misled him and represented that the rent was $714. Tenant moved to dismiss and for $500 attorney's fees; landlord concedes that petition should be dismissed but opposed award of attorney's fees. Motion for legal fees denied. An award of legal fees should be based upon the ultimate outcome of the controversy. The tenant in this case has won the battle but not the war. The DHCR has not yet decided the issue of the legal regulated rent - landlord can later sue for rent if the DHCR makes a decision in his favor. An award of legal fees would be tantamount to sanctioning the petitioner for commencing what he believed to be a legitimate cause of action.

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Case Caption:

Matter of Richburg v. Franco

Issues/Legal Principles:

Section 8 tenant not permitted to withhold rent based on breaches of warranty of habitability

Keywords:

chronic non-payment; Section 8; warranty of habitability

Court:

Supreme Court, New York County

Judge:

Hon. Herman Cahn

Date:

September 24, 1997

Citation:

NYLJ, page 26, col 4

Referred Statutes:

CPLR 3211(a)(7) & 7804(f); RPL 235-b; RPAPL 745(2)

Summary:

The tenant of a Housing Authority building, brought an Article 78 proceeding in Supreme Court for a declaration annulling and reversing the City's determination which placed her on probation after a finding of Chronic Delinquency of Rent. The tenant also sought an injunction against the City for its policy of sanctioning tenants who withhold rent based on documented violations of the warranty of habitability. The tenant had withheld rent on numerous occasions based on her claim of violations. She received an abatement in one 1994 nonpayment proceeding, and in the others she just paid the rent without receiving an abatement. In one of the cases there was an order to correct violations. The City then brought an administrative hearing against the tenant and found her to be a chronic non-payment tenant based on her withholdings of rent and placed her on probation. The City also took the position that if the tenant had violations she should take them to the City in a grievance hearing to the City, rather than withhold rent and let a court decide the warranty of habitability issues. The court dismissed that portion of the tenant's complaint that sought an injunction against the City for a policy of punishing tenants who withhold rent. The court held that there no proof was presented that the City had such a policy. The court also held that RPL 235-b does not permit a tenant to withhold rent for breaches of the warranty of habitability, but rather the tenant's obligation to continue to pay rent despite such breaches continues so long as the tenant remains in possession of the apartment (i.e., does not vacate).

Notes:

This case is disastrous for Section 8 tenants, but even for any tenants. Although RPL 235-b does not explicitly state that tenants are entitled to withhold rent based on claims of breaches of the warranty of habitability, this Court disregarded years of judicial precedent which permit tenants to withhold rent on such grounds. The court viewed such tenant actions as self- help remedies. Case law which holds that a tenant must vacate the premises before he or she is entitled to withhold rent has applied to commercial tenants, while residential tenants have not had this burdensome condition imposed on them.

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Case Caption:

Carter v. DHPD

Issues/Legal Principles:

With a vacate order, the City is entitled to use self-help to empty a building of occupants without going through court proceedings

Keywords:

vacate orders; unlawful evictions

Court:

Appellate Term, First Department

Judge:

lower court: Hon. Howard Malatzky

Date:

September 25, 1997

Citation:

NYLJ, page 27, col 2

Referred Statutes:

Administrative Code 27-2139(b), 27-2140(b) & 27-2142

Summary:

The city-owned building was subject to a vacate order and the occupant was evicted because of the order. The occupant brought an illegal eviction action against the City and the lower court held that the petitioner was a person "probably not a tenant" who was "illegally locked out" of the building by DHPD without resort to court process. The lower court ordered that the occupant be restored to possession. The City appealed and the Appellate Term reversed finding that the vacate order was not challenged or stayed in any proceeding and it had been posted in the building premises. The Appellate Term held that the Housing Maintenance Code authorizes the City to issue vacate orders in buildings "unfit for human habitation." The Appellate Term held that the City may use self-help to remove building occupants and seal the premises in order to enforce a vacate order. Since the vacate order had not been revoked, the occupant should not have been restored to the building.

Notes:

This case is alarming because it allows the City to bypass court proceedings and force tenants out of a building just by posting a vacate order. It would also allow private landlords to let a building deteriorate, then prod the City to issue a vacate order as an expeditious avenue to emptying a building of tenants. When a vacate order is issued, the building occupants have to vacate immediately. The occupants then have to scurry to Supreme Court to get a stay. This is costly and difficult because the occupants' papers to the court should contain an affidavit from an engineer which would present opposing evidence that the building is not a safety hazard (if that be the case). Yet, how might an engineer enter the building if it is sealed by a vacate order. It is advised that occupants (such as squatters) in deteriorated buildings have an engineer inspect the premises before a vacate order is issued so that his or her affidavit can be submitted readily to the court. Often there is a big dispute whether or not the building is in fact unsafe.

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