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Ongoing Fight to Restore RS Status

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Ongoing Fight to Restore RS Status

Postby ian6385 » Fri Feb 05, 2016 12:59 pm

Hello,

I've been living in my non-regulated Manhattan apartment for over 4 years now. I live with two other people, one of whom is a cosigner with me on the lease. The building has more than 6 apartments. When we received our renewal notice for this fourth year, our rent was increased by over 10% from $2,900 to $3,250.

Typical for a non-regulated apartment, you might say. A friend of mine who is a tenant advocate told me to look into the DHCR records for my apartment, and the information I saw in there prompted us to begin a Supreme Court case against our landlord.

The DHCR records showed that before we moved in, there was a Rent Stabilized tenant paying around $560 a month. This person lived in the apartment for two years before moving out. According to the record, the apartment was then registered as exempt due to High Rent Vacancy. Based on that record, it appeared that myself and my roommates were the next tenants to live in the apartment after it had been occupied by a rent stabilized tenant.

We signed on for $2,450 on July 1st, 2011. The very day the Rent Act of 2011 took effect. We did not receive any notices that the apartment was previously rent stabilized. We did the math and determined the landlord would have to had made over $75,000 in IAI renovations to bump the rent up from $560 to $2450. In addition, the threshold for deregulation was $2,500 on July 1st.

We filed our complaint with the Supreme Court May 1st, 2015. The landlord made two arguments to defend itself and have the case dismissed. (And also countersue us for $20,000)

1) The renovations for the apartment amounted to $82,000. We figured this would be the crux of their argument and we knew we had to prove there was a discrepancy.
2) There was ANOTHER tenant in between the rent stabilized tenant and us who signed the necessary lease to deregulate the apartment. This was pretty unbelievable to us when we heard it. How on earth were we going to prove there wasn't?

I and the other cosigner have been representing ourselves in court. I've been doing most of the "legwork" and in September I was able to get the judge to deny the landlord's motion to dismiss our case. Here's the evidence I was able to produce.

1) a. The renovations for the apartment actually amounted to $54,000 because the NYC Department of Buildings has records of the renovations, which are accessible online. Both the architect and the owner swore under penalty of perjury that the renovations only cost $54,000. According to those records, this included everything from demolition to construction to labor.

b. The cancelled checks made out to the contractor did not add up to their claimed amount. They only added up to about $71,000.

c. The apartment below our's was being renovated at the same time by the same contractor. When this point was brought up, the landlord failed to provide any more checks as evidence there were separate payments to this contractor for the other apartment.

2) There is no evidence the other tenant actually lived in the apartment. In fact, it was proven that no monies were exchanged between this alleged tenant and the landlord. We were able to find records of this "tenancy" at Housing Court. The tenant signed the lease in Feb. 2011 and a non-payment proceeding began in March 2011 and finally ended in June 2011. Whoever this person was, the landlord let them sign a lease without paying the first month's rent.

The $54,000 amount is crucial because using that amount for IAI improvements would have put the apartment under the pre-Rent Act of 2011 deregulation threshold of $2,000. So, even if that tenant were "real", they still would not have been able to deregulate the apartment.

Anyway, the judge ordered me to file a complaint with the DHCR within 30 days. I did just that. It came to about 230 pages with all the evidence included.

That was in late October. I've checked our case status and a rent examiner has still not been assigned. Our lease is up on June 31st, 2015. I have no idea what kind of renewal notice we will get this year, if at all.

I want to squat in the apartment until the DHCR makes a decision but I don't know if this is the best strategy.
ian6385
 
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Re: Ongoing Fight to Restore RS Status

Postby rentstubq » Fri Feb 05, 2016 2:48 pm

You already have a lawyer and an ongoing court case, it would probably be best to take your lawyers advice on this. If it were me I wouldn't vacate until the case is cleared up because if you don't have tenancy then the landlord could argue the case is moot, but I'm not a lawyer and am not giving legal advice, so take that for what you will.
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Re: Ongoing Fight to Restore RS Status

Postby ian6385 » Fri Feb 05, 2016 2:52 pm

We actually don't have a lawyer. We can't afford one. So far we've done this ourselves, have gotten quite far, and I am sure we'll be forced to continue doing that.

We certainly don't want or intend to vacate, but we also don't want to sign any more leases or riders. We also don't want to have to pay any more money than what is required of us in the lease. If we are forced to pay use and occupancy after the lease is up while we wait and see, a court will order us to do that, not the landlord.

Thanks for your input.
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Re: Ongoing Fight to Restore RS Status

Postby TenantNet » Fri Feb 05, 2016 4:10 pm

Let's see ... 2 tenants + 1 roommate. 6 units make it eligible for RS status.

LL says it's not RS due to high rent vacancy.

I see two issues:

1. Seems to be your grounds for the complaint, that as you signed the vacancy lease on 7/1/2011, the same day that the Rent Act of 2011 took effect, the trigger for high rent deregulation was - on that date - $2500, and therefore the unit, even if the legal rent was then $2450, was still covered by RS.

You might also be challenging any IAI increases. It appears the LL is claiming IAI of $72,000 as a defense. I see it that's a burden for the LL to prove.

Look into the "Altman" case, (search on this forum and google it). It's still under appeal, but might have some bearing. That the LL is now claiming there was ANOTHER tenant in between the rent stabilized tenant and you, might be trying to preclude an Altman claim. If nothing else, check with your neighbors to see if there really was anyone living there. Chances are this was an illusory (fake) tenancy. And I would think that a "tenancy" is not a tenancy without a lease and without consideration (rent being paid).

Questions:

The Supreme Court (SC) case might be premature? Why did you not file with DHCR?

Now, the judge ordered you to file with DHCR? Is he trying to get rid of the case? Problem with DHCR is that it can take years to decide and that's before any appeals. In fact, that's why some tenant attorneys go directly to DHCR, to avoid years of waiting.

What is the LL's $20,000 countersuit for?

Can you tell us (via private mail) who the LL is and who the LL's attorney is?

Going into SC is serious and complex, and not for the lighthearted. Generally you need to have some idea what you are doing, even though it appears you've gotten pretty far, I would - at a minimum - have a good tenant attorney review the situation and make recommendations. I'm troubled by the judge's forcing you to file with DHCR - that could allow him to toss your case. Get some good procedural advice.
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Re: Ongoing Fight to Restore RS Status

Postby ian6385 » Fri Feb 05, 2016 4:43 pm

Subject: Ongoing Fight to Restore RS Status

Thank you very much for your response. I'll answer your questions as best I can.

TenantNet wrote:Questions:

The Supreme Court (SC) case might be premature? Why did you not file with DHCR?


We originally had a lawyer named [redacted]. We consulted with them for a week before filing our complaint with the Supreme Court. It was their idea to go to the Supreme Court first. However, after a few months, [the lawyer] had trouble dealing with the increasing complexity of the case and asked to withdraw as counsel.

TenantNet wrote:Now, the judge ordered you to file with DHCR? Is he trying to get rid of the case? Problem with DHCR is that it can take years to decide and that's before any appeals. In fact, that's why some tenant attorneys go directly to DHCR, to avoid years of waiting.


The judge, [name redacted], was only appointed over the summer, and held the opinion the DHCR had the expertise to hear the case. My guess is they were trying to get rid of the case while also acknowledging legitimate issues of fact.

TenantNet wrote:What is the LL's $20,000 countersuit for?


Their legal fees.

TenantNet wrote:Can you tell us (via private mail) who the LL is and who the LL's attorney is?


[answer redacted but sent over private message]

TenantNet wrote:Going into SC is serious and complex, and not for the lighthearted. Generally you need to have some idea what you are doing, even though it appears you've gotten pretty far, I would - at a minimum - have a good tenant attorney review the situation and make recommendations. I'm troubled by the judge's forcing you to file with DHCR - that could allow him to toss your case. Get some good procedural advice.


The judge ordered us to file with the DHCR with the stipulation that if the DHCR felt it was outside the statute of limitations I could return to the Supreme Court.

I deeply appreciate your response. Do you have any more questions?
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Re: Ongoing Fight to Restore RS Status

Postby ian6385 » Mon May 16, 2016 9:39 am

Looks like this case is about to get a little crazy in the coming months.

DHCR is still in "initial processing" mode with my overcharge complaint. I have sent one letter requesting "expedited processing" to the bureau chief at the Office of Rent Administration since our lease is up on June 31st, 2016, and, as I write this, the landlord has not sent us any kind of renewal or non renewal notice.

In fact, we were served a three day notice to pay arrears for the last three months (March, April, May), and this is the second notice (January and February) in the last five months. The first notice was taken care of without any action from the landlord. This time, however, there appear to be some shenanigans.

Yes, I am once again doing this pro se. I have a couple of questions...

1. Do I have to use the official form to write my answer? The answer I've prepared thus far is 13 pages, and there just isn't enough room on that form to fully defend myself. I know I don't have to submit evidence with my answer, the explanation is just that long.

2. Admittedly, we had fallen behind one month in December, but I believe I have a valid laches defense because there was some funky accounting on my landlord's end. In January I started writing memo's on the checks stating the month to be paid for. So since I was a month behind, the check I wrote in January was for December, the check I wrote in February was for January, the check I wrote in March was for February, etc. I think the landlord ignored the memos though because they didn't take any action after serving us for January and February. Then at the end of March, we got a billing statement and for whatever reason there was an extra payment from an unknown source. I didn't ask any questions and thought "oh well I guess my dad or someone swooped in and paid a good chunk of the balance" and just paid the balance that was due in full with a memo saying it was for April. Of course now the landlord is not counting that mystery check two months later and wants the balance. What I'm arguing is that balance is actually the balance that was carried from December because the landlord kept ignoring my check memos and cashed checks for the month they were received. I know check memos are not legally binding but I guess that's kind of the point? Does that make any sense?

3. I'm not sure why the landlord is demanding April that was definitely paid for.

4. We tendered payment for May before we were served but the landlord is sitting on our check. I sent it certified mail, kept the certificate and receipt, and it was definitely delivered on time. Should I have taken a picture of the checks though?

5. I'm demanding a jury trial even though I have a jury waiver provision in my lease. If you recall earlier in this thread, this all started when my roommates and I were fraudulently induced into signing a lease that should have been rent stabilized given what we saw on record with DHCR and DOB less than four years later. Since we are alleging we were fraudulently induced into signing a lease with a jury waiver, we don't think we should be held to that waiver. I've seen precedent in commercial lease disputes that establishes this a valid defense against a jury waiver. Is there any precedent in landlord-tenant disputes this defense would also apply?

Thanks for your time. Wish me luck!
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Re: Ongoing Fight to Restore RS Status

Postby ian6385 » Sun Mar 26, 2017 12:18 pm

I'd like to thank everyone here who has helped me.

About a year and a half later, DHCR has refused to investigate my claim before May 1st, 2011. And of course, all the fraudulent scheming occured before then. I intend to file a PAR although I know that's an uphill battle.

The Supreme Court Justice who ordered me to file with DHcR did say I could move to restore my action in case DHCR cited statute of limitations or timeliness issues so i will probably do that as well.

The LL is still trying evicting me from the apartment, which I no longer live in. So i'll have to deal with that too.

But thank you everyone here for being so helpful and kind
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Re: Ongoing Fight to Restore RS Status

Postby TenantNet » Sun Mar 26, 2017 12:49 pm

How is the LL trying to evict you from the unit if you've already vacated? Have you not given up possession?

If he files in Housing Court, you can get that case tossed as jurisdiction in Housing Court is only for tenants in occupancy. If it's just for money, then he has to file in Civil Court or Supreme Court.
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Re: Ongoing Fight to Restore RS Status

Postby ian6385 » Sun Mar 26, 2017 2:51 pm

I went into the details of that here.

viewtopic.php?f=4&t=12238

There was a stay pending DHCR and now that they have decided I have 10 days to answer or move to dismiss and I plan to move because despite the decision the petition is defective for failing to state the facts the proceeding is based upon
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