The landlord opposes the motion on grounds that the Martin Act is not applicable and also that when the stipulation was signed tenant was asked if she wanted to retain counsel and the tenant said no. The landlord also states that the tenant is in arrears because tenant's Jiggetts rent payments were not paid by the City. The building was converted to co-operative ownership on March 31, 1998. The landlord is also the sponsor and holder of unsold shares. The tenant moved in in 1991. Since 1995 her lease has not been renewed.

Following the Appellate Term, Second Department's ruling in Paikoff v. Harris (see Housing Court Archives for the week of October 19, 1999), the court considered the tenant a "non-purchasing tenant" pursuant to the Martin Act. The landlord, however, argued that the settlement stipulation was entered into before the Appellate Term had decided Paikoff. Therefore, the court had to determine whether the stipulation should be set aside. The court ruled that stipulations are not lightly set aside unless they are unduly harsh or unjust and the parties may be restored to their former status. The court ruled that "good cause" is demonstrated where it appears that a party has "inadvertently, inadvisably or improvidently entered into an agreement which will take the case out of the due and ordinary course of proceeding in the action, and work to his prejudice." Here, the court noted that the tenant did not have an attorney, was unaware that her tenancy was protected pursuant to the Martin Act and that the landlord was required to allege and establish good cause in order to terminate her tenancy under the Martin Act's provisions. The court held the tenant signed the stipulation unknowingly waiving a significant and meritorious defense which would have defeated the petition. The court concluded that the tenant demonstrated good cause to justify vacating the stipulation. Since the tenant was protected by the Martin Act and since the landlord failed to show a good cause reason to evict her, the petition was dismissed.

The tenant moved to dismissed the petition on grounds that the landlord waived its right to evict for the alleged violation of the "no-pet" clause of the lease based on Administrative Code of the City of New York 27-2009. This law provides that if a tenant openly and notoriously for three or more months harbors a dog and the owner or its agents have knowledge of this fact, and the owner fails to commence litigation within that three month period, the owner then waives the right to evict based on the no-pet clause of the lease. The court found that the landlord had knowledge of the pet on June 1, 1999. The three month period expired on August 30, 1999. Since the action was not commenced until October 28, 1999, the court ruled that the landlord waived its right to evict the tenants on grounds of harboring a dog in violation of the lease. The landlord tried to argue that in the interim the parties were negotiating and therefore the three month period was tolled, but the court readily rejected this position.

The Court granted the managing agent's motion to dismiss for lack of personal jurisdiction. However, the cooperative, which asserted a counterclaim for alleged past due maintenance, management fees legal fees and/or other charges, waived the objection to service (lack of personal jurisdiction) by bringing a counterclaim which was found to be unrelated to the tenant's claims for property loss. The Court denied the cooperative corporation's motion.

Tenants should always be cautious not to assert counterclaims which are unrelated to the landlord's claims in a summary proceeding, if they intend to raise improper service (lack of personal jurisdiction) as a defense.

Landlord brought a nonpayment summary proceeding against the tenant, and the tenant asserted substantial warranty of habitability and repair defenses. The tenant obtained dismissal after the Court sustained the tenant's traverse claim. The tenant moved for legal fees.

The Court denied the tenant's motion for attorney's fees without prejudice to renew in a subsequent proceeding, inasmuch as the controversy had not reached its "ultimate outcome." Although the Housing Court agreed that in some cases a tenant may be awarded attorney's fees for a matter which is dismissed on procedural grounds (i.e. not on the merits): For example, where the landlord either fails to re-file the action within a reasonable time frame or takes an action which re-affirms the landlord-tenant relationship. The nonpayment case before the court indicated that the landlord intended to re-file the action.

Since the court did not accept the tenantþs argument that she is rent controlled, the tenant then argued that the Martin Act laws applicable to co-operatives and condominiums, apply here even though the building is no longer a co-op. The Martin Act has a clause that provides that an owner of a unit or the shares of a unit cannot evict a non-purchasing tenant on owner occupancy grounds. However, the court held that once the building lost its co-op status, the Martin Act also lost its purpose, and therefore the Martin Act law precluding owners from commencing owner occupancy proceedings against non-purchasing rent regulated tenants no longer applied. The court ruled that the tenantþs right to be protected under the Martin Act did not survive the foreclosure.

Tenant also argued that the back of the petition contained a wrong apartment number, #86 instead of #8. But the court said that a mere back does not constitute part of the pleadings, and that the pleadings themselves contain the correct information. The tenant also argues that the petition should be dismissed because the caption of the notice of petition states her street address as 129 West 8th Street, when in fact she resides at 129 West 86th Street. The ownersþ process server submitted an affidavit of service testifying that he served the papers at 129 West 86th Street. The court held that the tenant did not formally challenged improper service in the motion and therefore the court could not entertain that issue.

The definition of nonpurchasing tenant is one þwho has not purchased under the plan and who is a tenant entitled to possession at the time the plan is declared effective or a person to whom a dwelling unit is rented subsequent to the dateþ The Martin Act also provides that þno eviction proceeding will be commenced at any time against non-purchasing tenants for failure to purchase or upon any other reason applicable to expiration of tenancy.þ The court, however, rejected the applicability of the Martin Act to their tenancies. The court noted that each of the tenantsþ leases contains a clause stating that they are not rent regulated and that their leases have no restriction on the amount of rent or any renewal rights. The leading case on this issue Peikoff v. Harris, 178 Misc.2d 366, which was affirmed by the Appellate Term, Second Department (NYLJ, October 19, 1999, 28:4), held that the tenants there did qualify as non-purchasing tenants and could not be evicted. In the case here, this judge distinguishes the facts from Paikoff on grounds that the Paikoff owner was a sponsor of the plan, unlike this case. (But actually the Martin Act is applicable to þholders of unsold sharesþ whether they are the sponsors or not). In any event, in 1998, the sponsor sold all the units which the court held allegedly precludes the tenants from þnon-purchasing tenantþ status.

On November 30, 1987 DHCR reduced the rent due to rent impairing violations and no rent restoration order has since been issued. The rent, however, was never reduced despite the DHCR order. The tenant claims that he did not fully understand the meaning of the order and therefore did not pay the lower rent (i.e., the rent of the þmost recent rent adjustmentþ which is usually the last lease amount) until after the nonpayment proceeding began. The owner claims it was unaware of the order because it did not acquire the building until 1988. The issue before the court was whether the four year statute of limitations on overcharges is relevant, since over four years elapsed since the tenant asserted his claim that he paid more rent than he was legally obligated to and now seeks a refund.

The court, however, distinguished this type of case from an overcharge claim, which is what the laws pertaining to a four year statute of limitations addresses. The court ruled that the tenant is not basing its overcharge complaint on some irregularity contained in a periodic increase or registration statement that would require the examination of the rental history year by year for a period over four years. The DHCR Order reducing the rent in 1987 has not been rescinded nor a rent restoration ordered. The rental history for the past four years reveals a rent being billed and collected at a level above the DHCR order. The owner has an ongoing duty to apply the order. The court referred to an Appellate Term case which held that þat all timesþ the landlord was under a duty to reduce the rent in accordance with the DHCR rent reduction order þso that tenantþs claim is not based solely on an overcharge which occurred more than four years before the overcharge claim was interposed.þ Hollis Realty v. Glover 686 N.Y.S.2d 265 (App Term, 2nd & 11th Judicial District 1999). The tenant, however, can only collect the excess rent paid for the last four years and cannot go back to 1987.

Apartment 3F, a rent stabilized apartment in Stanley's name, was purchased by the petitioner-landlord who brought a holdover proceeding against Stanley on grounds of nonprimary residency. Tenant defended on grounds that the 1985 stipulation of settlement precludes the current landlord from raising this issue under the legal theory of collateral estoppel. The lower court granted tenant's motion dismissing the petition, ruling that the nonprimary residence waiver was not against public policy and was binding upon successors in interest (meaning the current landlord).

The Appellate Term reversed and reinstated the petition on grounds that the "practice of permitting tenants to stockpile rent stabilized apartments, immune from the requirement of primary residence should not be rewarded." The Court declined to give effect to the nonprimary residence waiver. The Court noted that the agreement was not made binding on the parties' successors or assigns. Even though the lower court "correctly recognized" that a purchaser takes premises subject to existing tenancies, `the key to the liability of the successor-in-interest is notice of the relevant lease provision or waiver thereof.'" The Court held that there was nothing in 3F's lease which gives notice of any waiver of the right to maintain a nonprimary residency action. In this case the Court held that the current landlord "cannot reasonably be said to have had actual or constructive notice of a private waiver wholly inconsistent with the rent stabilization scheme."

The Court, noted the general rule that termination notices are not required for illegal use proceedings pursuant to RPAPL 711(5) and RPAPL 715(1), as illegal use proceedings are founded on the statutory authority of RPL 231(1) rather than the prior termination of the tenancy (the predicate for the garden variety holdover summary proceeding). However, the Court recognized that NYCHA was governed by Title 24 of the Code of Federal Regulations ("CFR"), and specifically, 24 CFR 966.4, which requires a 30 day notice of termination. Moreover, even though prior courts held that a notice of termination required by the related 24 CFR 247.4 was not applicable to the termination of federally subsidized tenancies based upon illegal drug activity, 24 CFR 247.3 was amended on September 6, 1996, to expressly provide for such evictions, and the two related statutes (24 CFR 247.3 and 24 CFR 247.4) must be read in harmony to require a notice of termination. Moreover, 24 CFR 966.4 (the public housing counterpart to 24 CFR 247.3 and 24 CFR 247.4) was also amended to specify grounds for drug related criminal activity, and clearly requires a 30 day notice of termination. The Court dismissed the action without prejudice.

The Court disagreed, finding that since the landlord signed the notice, Siegel v. Kentucky Fried Chicken did not apply. Moreover, the landlord signed the tenant's initial lease, and the tenant paid rent to the landlord for the past thirteen years. Thus, it was unlikely that the tenant could be surprised or confused by the landlord's name on the rent demand. The renewal lease also showed that the managing agent signed in an agent's capacity.

The Court also stated that even if the notice was improper, it would still have subject matter jurisdiction over the action, despite the defective predicate notice. The Court denied the tenant's motion to dismiss, but stayed the execution of the warrant to give the tenant time to satisfy the judgment.