Housing Court Decisions October 1996

edited by Colleen F. McGuire, Esq.

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New York Law Journal, decisions for the week of
October 28 to November 1, 1996 (12 cases)

Case Caption:
Seward Park Housing Corp. v. Ostrow
Issues/Legal Principles:
Tenant not directed to deposit rent on application for adjournment
Keywords:
adjournment; rent deposit
Court:
Appellate Term, First Department
Judge:
lower court: Hon. Joan Madden
Date:
October 29, 1996
Citation:
NYLJ, page 25, col 5
Referred Statutes:
RPAPL 745(b)
Summary:
Pro Se tenant in non-payment proceeding sought a brief adjournment. Landlord demanded that tenant pay future use and occupancy as a condition to the adjournment pursuant to RPAPL 745(b). The lower court denied landlord's request "for good cause shown" by the tenant and the Appellate Term upheld, holding that such a decision lies in the sound discretion of the trial court so long as there exists no abuse of discretion or violation of RPAPL 745(b).
Notes:
This case appears innocuous, but actually arose out of a big hoopla instigated by local landlord organizations. RPAPL 745(b) provides: "In any adjournment of a summary proceeding, other than on consent or at the request of the petitioner, the court shall at the petitioner's request state on the record why for good cause shown it is not directing the tenant to pay or post all sums demanded pursuant to a lease or rental agreement in the proceeding as rent and use and occupancy." In the week of January 22, 1996, the landlords sought to show their muscle in Housing Court by challenging judges who allowed tenants a second adjournment without making the tenants pay future use and occupancy. Judge Madden was sitting in Part 18 on that week and this was the first case to come before her where the landlords attempted to put pressure on judges to make tenants pay use and occupancy. The calendar call of Part 18 was dramatically halted, a stenographer summoned and oral argument on landlord's application was made. The tenant, however, was not left to fend for himself. Judge Madden granted the application of a joint effort by Legal Services for NYC, Legal Aid Society and Northern Manhattan Improvement Corporation to appear as a "friend of the court," a status known as "amici." These three legal groups represented the Citywide Task Force on Housing and Metropolitan Counsel on Housing. Andrew Scherer of Legal Services argued on behalf of the tenant which was really an appearance and argument on behalf of all tenants in this implicit "test case." Fortunately, the words "for good cause shown" in the statute allows judges to exercise their discretion in whether or not to make the tenant pay or post the rents. Were it not for these words, tenants would be at a distinct disadvantage. The statute allows landlords to seek adjournments with no consequences, while a tenant seeking an adjournment has to wrestle with the possibility that a judge may make them put up the rent. This Appellate Term decision is a victory for tenants. Eventually, this particular case was settled between the landlord and the tenant. During the settlement the landlord apparently convinced the tenant not to challenge landlord's appeal of Judge Madden's decision. The landlord perfected its appeal and even appeared for oral argument before the Appellate Term, but the landlord (or its attorneys) never informed the attorneys for the tenant organizations about the appeal! When the tenant groups' attorneys belatedly found out about this underhanded manoeuver, they went to the Appellate Term on a motion to reargue. The Appellate Term denied the motion; it was a moot issue due to the Appellate Term's upholding of Judge Madden's decision. This case demonstrates why tenant organizations and legal aid groups are so important; they merit funding as these organizations actively advocate the side of tenants in the unequal arena of Housing Court where 90% of tenants are unrepresented.

Case Caption:
Delmonico Hotel Co. v. Rumsey
Issues/Legal Principles:
Landlord not liable for treble damages.
Keywords:
non-primary residence
Court:
Appellate Term, First Department
Judge:
lower court: Hon. James Grayshaw
Date:
October 29, 1996
Citation:
NYLJ, page 25, col. 1
Referred Statutes:
none cited
Summary:
Landlord brought a holdover against the rent stabilized tenant on grounds that tenant primarily resided in Wyoming where he owned a cabin and has oil investments. The tenant had been the tenant of record of the premises since 1979. The trial lasted 6 days and the lower court held for the tenant, finding that he "was in New York City on an ongoing, substantial basis." The Appellate Term deferred to the factual findings and holding of the lower court, but a vigorous dissent was submitted by Justice McCooe who noted that the tenant's main documents all bore a Wyoming address: federal income tax returns, voter registration, driver's license, ownership of property, truck registration, bank accounts and rent checks sent from Wyoming. An accountant testified on behalf of the landlord that state tax returns were prepared using computer software and that the 1991 and 1992 returns were prepared one after the other on the same day since the code numbers were in sequence. Nonetheless, the tenant testified that he signed them in different years. Justice McCooe noted that the tenant (who apparently was an attorney) was previously disbarred for committing perjury before a grand jury and engaging in a conspiracy to defraud relating to income tax. The lower court noted that tenant procured his voter registration in 1974 when he bought the property and prior to taking occupancy at his New York City apartment. The lower court also took into account that the tenant made long distance calls and used his ATM card to demonstrate the periods of his time in New York. Justice McCooe, however, noted that there was no verification that only the tenant possessed the ATM card or that the New York City telephone itself was actually used (instead of calls billed to that number). The dissent concluded that the tenant primarily resided in Wyoming and used his New York apartment for visiting and business purposes. This case was a close call, and will probably be appealed to the Appellate Division by the landlord.

Case Caption:
Melli v. Judge
Issues/Legal Principles:
Landlord held in contempt for illegal usage of apartment.
Keywords:
contempt; illegal occupancy
Court:
Civil Housing Court, Queens County
Judge:
Hon. James Grayshaw
Date:
October 30, 1996
Citation:
NYLJ, page 29, col 5
Referred Statutes:
none cited
Summary:
The case came before the court on an inquest, meaning that the tenant didn't appear. The premises involved an illegal basement apartment. The court granted landlord a possessory judgment but warned landlord that it was illegal to rent the space to anyone else. On its own the judge requested a Building Department Inspector to determine if the court's warning was followed by the landlord. The inspector found another occupant residing in the space and placed a C violation for an illegal double cylinder lock and a B violation for rooms in the cellar. The judge sent the landlord a notice to appear in court and explain why the landlord had disobeyed the judge's warning. Absent an explanation the judge fined the landlord $250 for civil contempt, ordered landlord to begin a holdover within 30 days to remove the new occupant, and ordered the landlord to correct all violations within 30 days and not relet the basement until the landlord had obtained a certificate of occupancy.

Case Caption:
Scott v. Haynes
Issues/Legal Principles:
Tenant in illegal apartment can be subject to eviction but not liable for rent.
Keywords:
certificate of occupancy
Court:
Supreme Court, Kings County
Judge:
Hon. Dowd
Date:
October 30, 1996
Citation:
NYLJ, page 29, col. 2
Referred Statutes:
RPAPL Articles 6 & 7; Multiple Dwelling Law, 302
Summary:
Landlord brought an action for ejectment in Supreme Court to evict the tenant from a basement apartment which was an illegal apartment. Tenant's lawyer argued that the landlord could not recover possession in an ejectment action, nor any rent owed, due to the absence of a certificate of occupancy. The court ruled that the absence of a certificate of occupancy did not bar the action to recover possession under RPAPL Article 7, but that the landlord is not entitled to any rent based on Multiple Dwelling Law, Section 302 which prevents owners from recovering rent where premises are occupied in violation of the certificate of occupancy.

Case Caption:
Ursula Realty Corp. v. Salm
Issues/Legal Principles:
Defects in non-renewal notice not fatal.
Keywords:
non-primary residency; non-renewal notice
Court:
Appellate Term, First Department
Judge:
lower court: Hon. Saralee Evans
Date:
October 30, 1996
Citation:
NYLJ, page 25, col. 2
Referred Statutes:
RSC 2524.3(b); RPAPL 741
Summary:
The Appellate Term reversed the lower court's dismissal of the holdover non-primary residency petition. The lower court had ruled that the notice of non-renewal of the lease failed to set forth necessary facts. The notice stated that the tenant was "rarely, if ever seen at" the apartment, owned a "home" in Germany, and primarily resided in Long Island where the tenant had eight cars registered in the tenant's name. The lower court noted that the name of the tenant was incorrect ("Wildred" instead of "Wiltraud"), that the notice referred to the tenant with masculine pronouns although the tenant was a woman, and that references to the original lease lacked precise dates. The Appellate Court ruled that these errors did not trigger due process concerns or render the notice invalid.

Case Caption:
Paragon Realty Corp. v. Kelly
Issues/Legal Principles:
Landlord failed to prove tenant knew or acquiesced in son's alleged drug dealing.
Keywords:
illegal usage
Court:
Civil Housing Court, Bronx County
Judge:
Hon. D. Thomas
Date:
October 30, 1996
Citation:
NYLJ, page 27, col. 2
Referred Statutes:
RPL 231(1) RPAPL 711(5)
Summary:
Landlord brought a holdover against the tenant alleging that the tenant used or permitted the apartment to be used for drugs and operated the premises for the sale of drugs or prostitution. The tenant resided in the apartment for 16 years and her 3 grandsons and granddaughter resided with her. Landlord's witnesses included two police officers, the managing agent, a commercial tenant from a neighboring building and two repairmen. Respondent's witnesses were herself, an upstairs neighbor, tenant's sister and daughter. Tenant's son had been arrested several times for drug possession, once in front of the building, but never inside the apartment. Landlord's witnesses testified to the son's alleged drugs deals in front of his mother's apartment building. Tenant's witnesses denied observations of the son's drug dealings in front of the building. The court ruled that since there was only one arrest outside the building, this isolated incident was insufficient evidence of ongoing illegal activity. The court also held that the landlord must prove that tenant knew of or acquiesced in the use of the premises (apartment or building) for illegal activity. The court found that the landlord failed to meet this burden with respect to this tenant.

Case Caption:
300 East 34th St. Co. v. Habeeb
Issues/Legal Principles:
Nephew lacked essential documents linking him to residency in uncle's apartment.
Keywords:
succession rights
Court:
Appellate Term, First Department
Judge:
lower court: Hon. Howard Malatzky
Date:
October 28, 1996
Citation:
NYLJ, page 27, col. 4
Referred Statutes:
RSC 2523.5(b)(e)
Summary:
The Appellate Term reversed the lower court's finding of facts in this succession rights case. (On questions of fact, as opposed to questions of law, appellate courts tend to defer to the trial judge.) The lower court found that the nephew had resided with his uncle for at least two years prior to the uncle's death. The Appellate Term, however, noted that all customary indicia of continuous residence pointed to the respondent's family home in Peekskill, New York. Justice Helen Freedman dissented from the majority ruling and noted that there was ample evidence in the record, including the testimony of relatives, friends and a housekeeper, that respondent cared for and resided with his uncle for at least three years prior to the uncle's death. She also noted that although the paper trail was limited there were documents (e.g., credit cards) linking respondent to the New York apartment, as well as the fact that he worked in New York City, the presumption being that he resided in the city where he worked.

Case Caption:
Fame Equities & Management Co. v. Malcolm
Issues/Legal Principles:
Landlord's nonpayment petition not defective since it excluded arrears sought in prior petition.
Keywords:
nonpayment; prior action pending
Court:
Appellate Term, First Department
Judge:
lower court: Hon. Marilyn Schafer
Date:
October 28, 1996
Citation:
NYLJ, page 27, col 4
Referred Statutes:
CPLR 3211(a)(4); RPAPL 735(2)(b); 22 NYCRR 130-1.1(c)(2)
Summary:
The lower court granted the tenant's motion to dismiss landlord's nonpayment petition on grounds that a "prior action was pending." However, the landlord's claim for the unpaid rent was for months not included in an earlier nonpayment petition (which had been dismissed and was on appeal). The Appellate Term reversed the lower court holding that the petition at issue could proceed with respect to arrears not sought in the first petition. The Appellate Term also found that landlord's failure to timely file proof of the service of the petition was a jurisdictional defect warranting dismissal. Apparently, landlord re-served the second petition and this was deemed acceptable by the appellate court. The Appellate Term also held that sanctions were not warranted when a "courtesy copy" of the re-served petition was taped to tenant's attorney's office door.

Case Caption:
Apinale v. 10 West 66th Street Corp.
Issues/Legal Principles:
Landlord failed to present evidence that tenant normal behavior in the apartment exceeded reasonable noise levels.
Keywords:
noise
Court:
Appellate Division, First Department
Judge:
lower court: Hon. Carol Huff
Date:
October 31, 1996
Citation:
NYLJ, page 26, col 4
Referred Statutes:
none cited
Summary:
Plaintiff tenant sued landlord and landlord counterclaimed that tenant breached the proprietary lease prohibition of unreasonable noise. The lower court granted tenant's motion for summary judgment and dismissed landlord's noise claim; the Appellate Division upheld. The Appellate Division ruled that the landlord failed to show continuous noise of a type or volume that a reasonable person under the circumstances would not tolerate. There was no evidentiary proof of unusual noises other than those normally emanating from an apartment, such as persons walking. Landlord's conclusory allegations that the noises were "loud" were not sufficient to warrant a claim against the tenant.

Case Caption:
In Re EGA Assoc. Inc. v. DHCR
Issues/Legal Principles:
Landlord's appeal of DHCR decision denied; landlord can't introduce new evidence during the PAR.
Keywords:
initial legal rent
Court:
Appellate Division, First Department
Judge:
lower court: Hon. Richard Lowe
Date:
October 31, 1996
Citation:
NYLJ, page 25, col. 1
Referred Statutes:
none cited
Summary:
Landlord failed to submit pertinent rental data for comparable apartments to assist DHCR in ascertaining the initial legal regulated rent, and tried to introduce new information allegedly showing improvements while the PAR was pending. The lower court denied landlord's Article 78 challenging the DHCR order and the Appellate Division upheld the denial.

Case Caption:
616 East Lincoln Avenue v. Finley
Issues/Legal Principles:
Landlord's conspicuous place service of non-payment petitions on vacant building was improper method of service.
Keywords:
service of process
Court:
Appellate Term, 2nd & 11th Judicial Districts
Judge:
lower court: Hon. B. Bunter-Zambelli
Date:
November 1, 1996
Citation:
NYLJ, page 34, col. 1
Referred Statutes:
RPAPL 735; CPLR 308(5)
Summary:
Landlord served the nonpayment petitions by conspicuous place service (on the door or under the door). The building was uninhabitable and all the tenants had vacated. Landlord claimed not to know the new residential addresses of any of the tenants. The lower court dismissed the petitions, holding that landlord failed to comply with the "reasonable application" service standards of RPAPL 735. The Appellate Term concurred, holding that it was impracticable for landlord to comply with RPAPL 735, and that the better course of action was that landlord should have moved under CPLR 308(5) to seek a court order to fashion a method of service reasonably calculated to give the tenants notice of the proceeding and an opportunity to be heard.

Case Caption:
Edgemont Corp. v. Audet
Issues/Legal Principles:
Tenant entitled to 100% abatement for deprivation of air, light and ventilation
Keywords:
abatement
Court:
Appellate Term, 2nd & 11th Judicial Districts
Judge:
lower court: Hon. Dinin
Date:
November 1, 1996
Citation:
NYLJ, page 34, col. 2
Referred Statutes:
RPAPL 743
Summary:
Landlord brought a nonpayment proceeding against tenant for three months rent. Tenant counterclaimed alleging deprivation of air, light and ventilation and presence of lead laden dust particles due to landlord's placement of plastic sheeting around the exterior of the house in connection with the removal of lead paint. Tenant also sought reimbursement for her costs of lead sampling and daughter's medical care. After trial, the court gave tenant a 100% abatement of rent for those three months, but no other monies, and further directed that two additional months rent previously deposited with the court be released to the landlord. Tenant moved to reargue on grounds that the latter two months not be released to the landlord because the abatement should have covered more than three months, and she again sought her out-of-pocket expenses. The appellate court upheld the principle that a deprivation of air, light and ventilation constitutes a breach of the warranty of habitability and that tenant merited an abatement for the full period the condition lasted, and rejected landlord's argument that tenant should not be permitted to deduct the abatement from her rent, but should commence a plenary proceeding to collect the amount of the abatement. The appellate court further rejected landlord's argument that tenant's counterclaim exceeded the monetary limit, holding that an abatement of rent is a defense defeating landlord's claim for rent, so additional affirmative relief to tenant on her counterclaim was not precluded. With respect to tenant's out-of-pocket expenses, the appellate court held that they were not sufficiently proven at trial. (Usually out-of-pocket expenses--known as consequential damages--are never awarded in a non-payment proceeding.

Case Caption:
Matter of Gandler v. Halperin
Issues/Legal Principles:
DHCR erred in calculating tenant's overcharges beyond four years from the date the complaint was filed.
Keywords:
overcharges
Court:
Appellate Division, Second Department
Judge:
lower court: Hon. Garry
Date:
November 1, 1996
Citation:
NYLJ, page 31, col. 1
Referred Statutes:
RSL 26-516(a)
Summary:
Tenant filed a rent overcharge complaint with DHCR who ruled that the apartment was subject to Rent Stabilization upon the addition of a sixth residential unit in 1978. The Appellate Division upheld this decision, as well as an award of treble damages, but sent the case back to DHCR to recalculate the overcharges for the past four years only. Since tenant's complaint was filed in September, 1988, DHCR erred in assessing overcharges prior to 1984.

New York Law Journal, decisions for the week of October 21-25, 1996 (4 cases)

Case Caption:
Matter of Coccaro v. Stupp
Issues/Legal Principles:
Tenant is exempt from reimbursement of SCRIE benefits given in error, but deemed ineligible for benefits due to level of income.
Keywords:
SCRIE benefits
Court:
Supreme Court, New York County
Judge:
Hon. Emily Goodman
Date:
October 23, 1996
Citation:
NYLJ, page 33, col 4
Referred Statutes:
RPTL 467-b; NYC Admin. Code 26-5090
Summary:
The tenant lived with his mother in a rent controlled apartment and she was the initial recipient of Senior Citizen Rent Increase Exemption ("SCRIE") benefits. When she died prior to 1985, the benefits were transferred to her son, the tenant. When he recertified, SCRIE staff determined he was not eligible for the exemption and allegedly sent revocation notices retroactive to January 1, 1986. The tenant claims he never received the notice and continued to pay his former rent of $157.40 per month and the landlord continued to accept the abated rent and applied for the tax abatements. The overclaims were discovered during a routine audit. SCRIE sought to recoup the $22,036.80 in claimed tax abatement from the landlord and to set tenant's rent at $474.38. The landlord then turned to tenant to pay the amount through a non- payment proceeding in Housing Court which was stayed when the tenant filed a complaint with Department for the Aging ("DFTA"). The DFTA revoked tenant's SCRIE benefits and directed tenant to refund the costs of SCRIE tax abatements (equal to the tenant's rent exemption) claimed by landlord from DFTA from 1986 to 1991. Tenant appealed by way of an Article 78. The judge granted tenant's petition only to the extent of determining that he was not required to repay the SCRIE abatements, but remanded the case to the DFTA on the issue of whether the tenant was eligible for SCRIE benefits. DFTA moved to reargue the court's decision, which motion was granted solely with respect to the continuing eligibility issue; the court denied reargument on tenant's lack of liability for the six-year SCRIE tax abatements. (The landlord had since paid half the amounts due DFTA). The court found that DFTA properly determined that tenant was ineligible for SCRIE renewal during the years 1986-1991 because his total income in that period was greater than the SCRIE income ceiling for each year. The tenant claimed that SCRIE's calculation of income is vague and arbitrary because it doesn't consider deductions for long term capital losses as does the Internal Revenue Service in its calculation of federal income tax due. Had DFTA considered this reduction, the tenant argued that he would have become eligible for SCRIE benefits. The court, however, relied on statutory definitions of income to determine that the deductions should not be encompassed within SCRIE guidelines and upheld its initial ruling that tenant was not eligible for SCRIE benefits during the period at issue.

Case Caption:
Matter of Symanski v. NYS DHCR
Issues/Legal Principles:
Landlord not liable for treble damages.
Keywords:
overcharges
Court:
Supreme Court, Kings County
Judge:
Hon. H. Kramer
Date:
October 23, 1996
Citation:
NYLJ, page 35, col. 5
Referred Statutes:
RSL 26-517(e)
Summary:
On July 31, 1986, tenant filed a DHCR complaint alleging that landlord failed to file the initial apartment registration and overcharges. In response, the owner submitted copies of leases from 1981 to 1984 bearing a rent of $288.66 per month and 1984 to 1986 bearing a rent of $308.82. In 1991, the DHCR Rent Administrator ruled that the owner had not properly registered the unit as of April 1, 1984 and had not served a copy of the initial registration upon the tenant. The order set the legal rent at $285.63 as of April 1, 1984 and assessed treble damages. The owner filed a PAR (i.e., an appeal) although it was filed at the wrong DHCR office. The owner claimed that during the proceeding the owner refrained from collecting any increases and that the tenant's rent payments during this period were inconsistent and often deficient. The PAR order reduced the overcharge to a nominal amount and vacated the treble damages. The court ruled that the filing of the PAR in the wrong office was inadvertent and did not prejudice the tenant. The court further ruled that a finding of overcharges was proper as the landlord did indeed fail to file an initial registration. With respect to the treble damages, the court referred to the Rent Regulation Reform Act of 1993 which provides that treble damages for a willful overcharge shall not apply where the overcharge is based solely on the owner's failure to file an annual registration statement.
Notes:
This case should not have relief on the 1993 Rent Regulation Reform Act because it is only applicable for cases commenced after its passage. This court, however, found that a $3.03 per month overcharge was de minimus and somehow that justified making the act applicable. This case doesn't say whether the landlord finally registered the apartment. This case also does not distinguish between an initial registration and an annual registration. The Appellate Term, First Department holds that the failure to file an initial rent registration bars an owner from collecting rent in excess of the last legal registered rent. This means that the tenant is liable for only for the amount of the last legal rent until such time as the landlord does file the initial registration. However, if a tenant pays the lower rent prior to the landlord's filing, he or she cannot recover the overcharges. Tenant can only recoup overcharges if he or she is actively withholding rent. As to the withheld rent, tenant need only pay the amount of the last legal registered rent. Once the landlord files the initial registration, no further reductions are accorded the tenant (unless perhaps tenant has other grounds for challenging that newly registered rent. See Goldman v. Porges, NYLJ, 3-28-95, 25:1 (AT 1). This is a real confusing and esoteric area of landlord-tenant law, and takes much patience in interpreting the statutes and the case law.

Case Caption:
1451 Realty LLC v. Berger
Issues/Legal Principles:
Non-payment petition is defective for failure to name all tenants
Keywords:
necessary parties
Court:
Civil Housing Court, Kings County
Judge:
Hon. Callender
Date:
October 23, 1996
Citation:
NYLJ, page 36, col 2
Referred Statutes:
CPLR 1001(a)(b), 1003, and 305(c); Rent Control Laws Section 26-403(e)(9)
Summary:
Landlord brought a nonpayment proceeding which the court dismissed because the landlord failed to name the Respondent's sister as a party to the proceeding. Both sisters moved into the apartment at the same time, lived together for over 30 years and both were statutory tenants of record. The landlord's agents were aware of both sisters' presence and there was evidence that on many occasions the sisters paid the rent with separate checks. As a result, both sisters were necessary parties; a judgment against one would effect the other. The failure to name both sisters required the petition's dismissal.

Case Caption:
Costa v. David Frankel Realty Inc.
Issues/Legal Principles:
Landlord improperly denied roommate access and permission to move into premises.
Keywords:
roommates; sublet
Court:
Supreme Court, New York County
Judge:
Hon. Heitler
Date:
September 23, 1996
Citation:
NYLJ, page 33, col. 6
Referred Statutes:
CPLR 3211(a)(7); RPL 235-f(2)(3)(9); Executive Law 296(5)
Summary:
Plaintiff attempted to move into tenant's apartment as a roommate but when she appeared at the building, the landlord would not allow her to move in on various alleged grounds: that she really was a subtenant, that the tenant's prior roommate damaged the premises; that the plaintiff had deceptively intended to claim succession rights. Plaintiff incurred damages by having to pay for the movers and make costly alternative living arrangements on the spot. Two weeks later, the landlord said she could move in, but again thwarted her efforts when she arrived with a mover, and only a telephone call from her attorney led to the owner's acquiescence. Several months later plaintiff vacated the apartment on her own accord. Thereafter plaintiff sued on various legal theories including violation of the Roommate Law (RPL 235-f), Human Rights Law, breach of contract, tortious interference with contract and intentional infliction of emotional distress. The court granted landlord's motion to the extent of dismissing all the causes of action except the Roommate Law and limited plaintiff's damages to the expenses incurred in having to make hasty and costly alternative arrangements on the two occasions her access was denied. The court commented at length as to the rights involved under the Roommate Law, noting that a tenant does not need an owner's permission and consent to have a roommate. As to the Roommate Law cause of action, the court on its own ("sua sponte") referred the case to the Civil Housing Court.

New York Law Journal, decisions for the week of October 14-18, 1996 (3 cases)

Case Caption:
4305 Associates v. Davis
Issues/Legal Principles:
Sister granted succession rights upon proof of primary residency with tenant for over two years.
Keywords:
succession rights
Court:
Civil Housing Court, Bronx County
Judge:
Hon. Fiorella
Date:
October 16, 1996
Citation:
NYLJ, page 30, col 5
Referred Statutes:
RPL 226-b & 235-f; RSC 2523.5(b)(1)
Summary:
Landlord brought a holdover proceeding alleging unlawful sublet and that the prime tenant did not occupy the apartment as her primary residence. The tenant, Regina, moved into apartment 1D in July, 1989. Her sister, the respondent in this case, moved into another apartment in the building in February, 1990. Their mother moved into a third apartment in the same building in July, 1990. Respondent testified that due to a serious asthmatic condition she could no longer walk down stairs and begin staying with her sister and her mother. She fully moved into Regina's two-bedroom apartment in April, 1993 along with her child. She testified that Regina vacated the apartment in November, 1994. Rent checks in Respondent's name were accepted by the landlord who gave her receipts in her name from January 1995 to April 1996. Respondent offered additional evidence (such as bank statements) bearing her address (Regina's apartment). The court concluded that Petitioner knew of Respondent's residency and accepted rent in her name for a substantial period of time. The court concluded that Respondent resided with her sister for two years in the apartment as her primary residence prior to the sister's vacatur, thereby satisfying the succession rights criteria under the statute. The court directed Petitioner to tender Respondent a lease in her name within thirty days.

Case Caption:
Neerg Corp. v. Hamilton
Issues/Legal Principles:
Unverified petition is not dismissed due to tenant's untimely notice of an intention to reject the petition on this ground.
Keywords:
verification
Court:
Civil Housing Court, Kings County
Judge:
Hon. Peter Wendt
Date:
October 16, 1996
Citation:
NYLJ, page 32, col. 1
Referred Statutes:
CPLR 3020(d)(3); RPAPL 721 & 741
Summary:
Tenant's attorney moved to dismiss the holdover petition on various grounds, including lack of verification. (A verification is where the party, or the attorney, signs a document and sets forth that the facts in the document are true). The landlord's attorney argued that there was a verification, but it was never attached to court documents. The law provides that an opposing party may treat an unverified petition as a legal nullity provided notice with due diligence is given to the attorney of the adverse party that the intent is to so treat it as a nullity. "Due diligence" is interpreted as within 24 hours. The tenant's attorney argued that she only recently was retained and was not given the petition until nine days after its service on the tenant. Then the attorney observed the defect and immediately brought the motion to dismiss. The court found, however, that the attorney made one appearance in court for an adjournment and never mentioned that she would be treating the unverified petition as a nullity. The court rejected the tenant's motion to dismiss the petition because over three weeks elapsed before the landlord's attorney was informed that tenant's attorney treated the petition as a nullity. Due to untimeliness and lack of prejudice to the tenant, the court denied the tenant's motion to dismiss on this ground.

Case Caption:
Ansonia Tenants' Coalition Inc. v. Ansonia Goons
Issues/Legal Principles:
Tenant's DHCR award not deemed an overcharge, thus not subject to a four-year statute of limitations.
Keywords:
tenants association
Court:
Supreme Court, New York County
Judge:
Hon. David Saxe
Date:
October 15, 1996
Citation:
NYLJ, page 28, col. 6
Referred Statutes:
RPL 230
Summary:
Plaintiff tenants association sought a preliminary injunction to restrain defendants from organizing or participating in tenant activities, including surveilling or stalking its members or their apartments. The defendants in this case included the owners and sponsors of the plan to convert the Ansonia to condominium ownership, managing agents, superintendents and security personnel allegedly hired by the other defendants. This case has a long acrimonious history of sparring between the parties. The court denied plaintiff's motion holding that there has been an insufficient showing of the allegations that plaintiff's personal safety was threatened (despite detailed allegations by plaintiffs of specific incidents). The court granted defendant's motion to have the name "Goons" stricken from the caption because it was scandalous and prejudicial and not relevant to the controversy.

New York Law Journal, decisions
for the week of October 7-11, 1996 (7 cases)

Case Caption:
Urra v. Friedman
Issues/Legal Principles:
Wrongful eviction action dismissed due to the statute of limitations.
Keywords:
wrongful eviction; statute of limitations
Court:
Appellate Division, Second Department
Judge:
lower court: Hon. Dowd
Date:
October 7, 1996
Citation:
NYLJ, page 36, col 5
Referred Statutes:
CPLR 205(a) & 203(b)(5)(i) & (e)
Summary:
Plaintiffs were evicted from their apartment on January 29, 1986 due to a default judgment and warrant of eviction. A default judgment means the tenants never appeared in court to answer the petition and the landlord automatically won. Plaintiffs served their wrongful eviction complaint on February 18, 1986, 21 days after the eviction. On October 21, 1986, the default judgment and warrant of eviction were vacated. On July 13, 1987, plaintiffs' complaint for wrongful eviction was discontinued. The Appellate Division noted that the record was unclear whether the discontinuance was voluntary. The statute of limitations on their claim expired on January 29, 1987. The Court assumed that the discontinuance was not voluntary, and therefore plaintiffs had a six-month period from July 13, 1987 to recommence the action, by virtue of CPLR 205(a). The six-month period expired on January 29, 1988. Since plaintiffs did not recommence their complaint until February 29, 1988, the Appellate Division affirmed the lower court's dismissal of the complaint as barred by the statute of limitations.

Case Caption:
Matter of Nicolaides v. DHCR
Issues/Legal Principles:
Landlord required to serve new non-renewal notice where first notice results in dismissal of case.
Keywords:
non-renewal notice
Court:
Appellate Division, Second Department
Judge:
lower court: Hon. I. Aronin
Date:
October 7, 1996
Citation:
NYLJ, page 36, col. 4
Referred Statutes:
none cited
Summary:
Landlord's holdover proceeding was dismissed in civil court. Landlord commenced a second proceeding (apparently before the DHCR) to get the agency's permission to evict the rent stabilized tenant. The landlord used the same notice of non-renewal of lease as was used in the civil court proceeding. (The case doesn't specify the grounds for eviction). The DHCR dismissed the landlord's application on grounds that the first notice of non-renewal was no longer valid and service of a second notice was required. The landlord appealed by way of an Article 78. The Supreme Court upheld the DHCR decision and landlord appealed again to the Appellate Division, which affirmed the Supreme Court's holding.

Case Caption:
Mansions v. Moorhead
Issues/Legal Principles:
Tenant's DHCR award not deemed an overcharge, thus not subject to a four-year statute of limitations.
Keywords:
abatement; overcharge
Court:
Appellate Term, First Department
Judge:
lower court: Hon. Margaret Taylor
Date:
October 8, 1996
Citation:
NYLJ, page 25, col. 4
Referred Statutes:
CPLR 213-a & 203(d); RSC 2522.3(d); RPL 234
Summary:
The Appellate Term upheld the dismissal of the non-payment petition by the lower court since it was established that the landlord owed tenant $4,332.37, an f tenant's performance, i.e., landlord recovered the apartment, albeit belatedly. The Appellate Term remanded the case to the lower court for an order wherein the $15,000 would be returned to the tenant, but landlord was entitled to use and occupance for the period tenant held over after September 21st and for any damages attributable to tenant's delayed vacatur (e.g., inability to re-let the premises on the first of the month.)

Case Caption:
Forde v. Novick
Issues/Legal Principles:
Court lacks jurisdiction where tenants vacated prior to commencement of the proceeding.
Keywords:
surrender of premises
Court:
Civil Court, Dutchess County
Judge:
Hon. Pergament
Date:
October 9, 1996
Citation:
NYLJ, page 27, col. 2
Referred Statutes:
none cited
Summary:
Prior to the landlord's commencement of a summary proceeding, the month to month tenants had already vacated the apartment. The tenants claimed they gave the landlord oral notice. The landlord argued that at the time the summary proceeding commenced the tenants were still in possession because they failed to turn over the keys and left substantial abandoned property in the apartment, including furniture and clothes. A landlord cannot maintain a summary proceeding if the tenant has already vacated. So the issue before the court was who had dominion and control over the premises at the time the landlord commenced the proceeding. The court queried whether the tenants retention of the keys and the abandonment of property constituted possession of the premises on their part. The court noted that the landlord had a key to the apartment, inspected the premises shortly after the tenants' vacatur, removed some of the abandoned property (which tenants never returned to collect) and finally sent the tenants a demand for rent at their new address. The court concluded that to have jurisdiction in a summary proceeding the tenant must have physical possession of the premises, not merely the legal right of possession. The court concluded that based on the facts before it, the tenants were not in possession at the time the proceeding was commenced and therefore the court lacked jurisdiction to entertain the landlord's claim (which apparently was one for rent owed).

Case Caption:
Matter of Jemrock Realty Co. v. NYS DHCR
Issues/Legal Principles:
Tenant's Fair Market Rent Appeal is governed by the laws in effect at the time of filing.
Keywords:
overcharges; Fair Market Rent Appeal
Court:
Supreme Court, New York County
Judge:
Hon. Cozier
Date:
October 9, 1996,
Citation:
NYLJ, page 21, col. 5
Referred Statutes:
RSC 2522.3(e) & 2521.1(d)(1)
Summary:
Landlord brought an Article 78 to appeal the DHCR's decision which reduced the tenant's rent stabilized rent after hearing a Fair Market Rent Appeal ("FMRA") which the tenant filed in November, 1983 with the CAB, the DHCR's predecessor agency. In 1985 the District Rent Adminstrator ("DRA") ruled that the rent of $875.00 was to be reduced to $630.49 and directed landlord to give tenant a refund in excess rent of $9,426.93. The landlord filed a PAR in 1985. In 1991, the DRA modified its decision in tenant's favor by increasing the tenant's refund to $12,855.99 from 1985 to 1990. The landlord filed a PAR on this order. In 1996, the Commissioner handling the PAR affirmed the DRA's 1991 order. It was this order which the landlord appealed in an Article 78. The DHCR usually calculates the rent in FMRA cases by reviewing the applicable rent guidelines and comparability data representing rents for similar apartments ("comparables") in the same area as the subject apartment. The DHCR may consider as comparables: (1) legal regulated rents where the FMRA process either lapsed or was resolved, and (2) at the owner's option, market rents in effect for other comparable housing on the date of the initial lease for the subject apartment. DHCR has discretionary authority to decide whether to accept or reject the landlord's proffered leases as truly comparable. Prior to April 1, 1984, in order for a legal regulated rent to be considered comparable the owner, in order to show that the proposed comprables were no longer subject to a FMRA, had to provide proof of service of a DC-2 form upon the first rent stabilized tenants of the allegedly comparable apartments. Prior to May 1, 1987, an owner was permitted to submit only comparability data drawn from leases commencing one year before or one year after the commencement date of the initial lease for the subject apartment. On April 1, 1984, the law changed and DHCR required that an apartment registration form (RR-1) served by an owner on a tenant, which went unchallenged, could be used for purposes of showing that a proposed comparable was no longer subject to a FMRA. Therefore, the RR-1 form could be used as a substitute for the DC-2 form. Also, effective on May 1, 1987, DHCR required that an apartment would be considered comparable if its lease commenced four years prior to or one year after the commencement date of the initial lease for the subject apartment. This expanded the eligible period from which comparability date could be taken from two years to five years. In 1984 and 1986, the DHCR sent notices to the landlord informing it that proof of service of the DC-2 forms were required and that the leases of eligible comparables had to have commenced one year before or one year after the commencement date of the tenant's initial lease. The landlord asserted that the 1984 and 1987 revisions revisions in the law affecting the use of comparables increased the number and type of apartments the landlord could have submitted as comparables and the DHCR was remiss in not informing the landlord of these changes. The landlord argued that the proceeding was pending after April 1, 1984, the date on which the use of the RR-1 forms were first permitted, and therefore the DHCR should have specifically notified it of the opportunity to submit comparability data for apartments where RR-1 forms had been properly served. Had it been notified, the landlord contended, it would have submitted comparability data for apartments whose leases had commenced four years prior to the inception of the tenant's tenancy. DHCR argued that since the FMRA claim was filed before 1984 it was bound by the old rules. The court ruled that Section 2521.1(d)(1) of the Code provides that a FMRA claim not determined prior to April 1, 1984 shall be determined based on the law in effect on March 31, 1984. Although the FMRA was filed in 1983, the provisions in effect were the old laws and these are the ones the landlord was subject to. Thus, DHCR had no duty to notify the landlord of the new rules.

Case Caption:
1050 Tenants Corp. v. Lapidus
Issues/Legal Principles:
Co-op granted $336,288.92 in legal fees against shareholder tenant who delayed and protacted the non-payment proceeding for almost four years.
Keywords:
attorney's fees
Court:
Civil Court, New York County
Judge:
Hon. Martin Shulman
Date:
October 10, 1996
Citation:
NYLJ, page 25, col. 2
Referred Statutes:
none cited
Summary:
The proceeding involved a rent dispute between the Co-op Board and the shareholder tenant of a luxury Park Avenue co-op. In 1992, the Board voted to increase the monthly maintenance and added assessments which meant tenant's monthly rent (i.e., maintenance) increased to $2,483.12. The tenant (whom the court referred to in a footnote as "a savvy real estate attorney with extensive litigation and trial experience") refused to pay rent in March 1992 and a non-payment proceeding was commenced. After a lengthy trial, Judge Shafer awarded the Co-op a judgment for $43,834.26 for arrears from March, 1992 to March, 1993. Tenant argued that since Judge Shafer never wrote a formal order regarding attorney's fees, her decision settled all claims through March, 1993, including any claim by the Co-op for attorney's fees. The tenant appealed to the Appellate Term and the Appellate Division, both of which were unsuccessful. After the appeals, the Co-op moved in civil court for attorney's fees. Judge Hahn granted the Co-op's motion, tenant appealed, and the Appellate Term upheld the Co-op's award of attorney's fees the Co-op was the prevailing party. The tenant made numerous other motions all designed to protract and delay the matter and "implicitly designed to economically force the Co-op to its knees," according to Judge Shulman. At the attorney's fees hearing before Judge Shulman, the Co-op's attorney testified that 2,032.80 hours were billed over a four year period totalling roughly $355,000. The court accepted several of the tenant's arguments why certain hours should not be awarded and granted attorney's fees to the Co-op totalling $309,178.50, plus disbursements of $27,110.42. The court rejected tenant's claim that this was a garden variety non-payment case and that the fees were excessive.

New York Law Journal, decisions
for the week of September 30 to October 4, 1996 (11 cases)

Case Caption:
Beachway Operating Corp.
Issues/Legal Principles:
Subtenant lost all rights when prime lease was canceled.
Keywords:
subtenants
Court:
Appellate Term, First Department
Judge:
lower court: Hon. Howard Malatzky
Date:
October 1, 1996
Citation:
NYLJ, page 21, col 3
Referred Statutes:
RPAPL 713
Summary:
Landlord served subtenant a ten day notice to quit after the prime tenant's lease was cancelled. The Appellate Term upheld the lower court's ruling that the undertenant's possessory claims were extinguished once the paramount lease was canceled as a subtenant's rights flow only from those held by a prime tenant.

Case Caption:
Park Holding Co. v. Rosen
Issues/Legal Principles:
Respondent denied succession rights when court found mother's primary residency was elsewhere.
Keywords:
unlawful sublet; nonprimary residency; succession rights
Court:
Appellate Term, First Department
Judge:
lower court: Hon. Howard Malatzky
Date:
October 3, 1996
Citation:
NYLJ, page 24, col. 1
Referred Statutes:
RSC 2523.5(b)(1)
Summary:
The Appellate Term upheld the lower court's finding of fact that the respondent did not reside with his mother, the tenant of record, for two years prior to her vacatur of the apartment. Therefore, the respondent was not entitled to succession rights to the apartment. The court ruled, "When a person other than the lessee is shown to be in possession of leasehold premises the law will presume the existence of an assignment or sublet agreement and proof of such agreement is not required." The dissenting judge noted that the landlord brought the proceeding as an unlawful sublet, but the lower court tried it as if it were a non-primary residency case, but then reverted to the illegal sublet theory by granting the tenant ten days to cure the illegal sublet. The dissent noted that the respondent was the tenant's son who resided in the apartment for virtually his entire life, except for one year following his graduation from college when he moved into another apartment with a friend. The dissent saw the facts differently; that although the mother re-married she did not live full time with her husband in his apartment but evidence showed she continued to use and occupy the premises as her primary residency, and documentary evidence was available to this effect. The dissent felt that the landlord should have waited until the lease expired to bring a non-primary residency proceeding, rather than converting the unlawful sublet case into a quasi non-primary residency case where the mother's residence was a primary issue in dispute.
Notes:
This case reveals some of the confusion involved in differentiating between non-primary residency proceedings and unlawful sublet proceedings. In an unlawful sublet proceeding, it is not necessary for the landlord to prove that the tenant no longer occupies the premises as their primary residence. The landlord need only prove that the tenant is not in occupancy and someone else is in occupancy without the landlord's consent. Simply because a tenant is not residing in the apartment does not necessarily mean that the premises are no longer the primary residence of the tenant, which is a higher burden to prove.

Case Caption:
545 8th Avenue Assoc. v. New York City Loft Board
Issues/Legal Principles:
Occupant granted Loft Law coverage even though occupant is not prime tenant.
Keywords:
Loft Law
Court:
Appellate Division, First Department
Judge:
lower court: Hon. Schackman
Date:
October 3, 1996
Citation:
NYLJ, page 21, col. 4
Referred Statutes:
26 RCNY 2-09(b)(2); Multiple Dwelling Law 281(4)
Summary:
The Appellate Division upheld the Loft Board and the Supreme Court's finding that the Loft Law provides coverage for a residential occupant in possession of loft premises even if the occupant is not the prime tenant, and even if the landlord did not consent to the sublet, so long as the occupant was in possession prior to July 27, 1987.

Case Caption:
Friedman v. Mayor
Issues/Legal Principles:
Service of process during working hours held reasonable when prior attempt was made on a Saturday, traditionally deemed non-working hours.
Keywords:
service of process
Court:
Civil Housing Court, New York County
Judge:
Hon. Bruce Gould
Date:
October 2, 1996
Citation:
NYLJ, page 26, col. 3
Referred Statutes:
RPAPL 735
Summary:
Landlord's process server served the holdover petition alleging unlawful sublet by conspicuous place service, that is, by placing the court papers on the door or under the door and mailing copies by regular and certified mailing within 24 hours thereafter. A "reasonable application" must be made to first attempt personal service on the tenant before resorting to conspicuous place service. Thus, a process server should attempt service at least once during non-working hours, working hours generally being 8:00 am to 6:00 pm. The process server first went to the premises on a Saturday. The court held that the process server's service of the papers during traditional working hours was reasonable since the server had already attempted service once during non-working hours on Saturday.

Case Caption:
619 West 145th Street Realty Corp. v. Carty
Issues/Legal Principles:
Landlord served rent controlled holdover papers to wrong DHCR office
Keywords:
rent controlled holdovers
Court:
Civil Court, New York County
Judge:
Hon. Saralee Evans
Date:
October 2, 1996
Citation:
NYLJ, page 23, col. 4
Referred Statutes:
DHCR Regulations 2200.3(g) and 2200.8
Summary:
Landlords are required to serve copies of a holdover petition based on non-primary residency against a rent controlled tenant with the District Rent Office ("DRO"). The DHCR Regulations sets forth where the DRO office is located for particular areas of Manhattan: the Lower Manhattan DRO is the south side of 110th Street and below, while the Upper Manhattan DRO is the north side of 110th Street and above. Petitioner served the DRO in Upper Manhattan, yet the apartment's jurisdiction was located in Lower Manhattan. Given that service was made on the wrong DRO, the court dismissed the petition without prejudice for the landlord to re-serve at the proper DRO office.

Case Caption:
342 West 30th Street Corp. v. Vaswani
Issues/Legal Principles:
Tenant denied punitive damages against landlord for breaches of warranty of habitability
Keywords:
punitive damages; warranty of habitability
Court:
Appellate Term, First Department
Judge:
lower court: Hon. Gerald Klein
Date:
September 30, 1996
Citation:
NYLJ, page 26, col. 6
Referred Statutes:
none cited
Summary:
Tenant sought punitive damages against landlord for breaches of the warranty of habitability. The Appellate Term affirmed the principle that landlords may be liable for punitive damages, but only where the conduct is proven to be motivated by malice or is so reckless or grossly negligent as to rise to the level of criminal disregard for tenant's health and safety. This tenant failed to prove that level of conduct against the landlord.

Case Caption:
619 West 145th Street Realty Corp. v. Carty
Issues/Legal Principles:
Termination notice proper where statutory basis cited
Keywords:
termination notices
Court:
Appellate Term, First Department
Judge:
Lower court: Hon. Joan Madden
Date:
October 1, 1996
Citation:
NYLJ, page 21, col. 1
Referred Statutes:
RPL 235-f; RPL 226-b; RSC 2524.3(a)
Summary:
The Appellate Term reversed the lower court's dismissal of the petition finding that the notice alleging unlawful sublet or failure to notify landlord of a roommate was proper in that the notice identified the sublet and/or roommate by name and cited tenant's California address. The Appellate Term also held that the notice was not defective simply because it did not cite a lease provision which was violated because the allegations were not based exclusively on a breach of the lease. The allegations were also based on statutory violations and the notice in fact referenced the specific statutes. The Appellate Term reinstated the petition.

Case Caption:
Tri-Block Assoc. v. Cardona
Issues/Legal Principles:
Niece wins succession rights to Section 8 Housing although not listed on recertification forms.
Keywords:
succession rights; Section 8
Court:
Civil Housing Court, Kings County
Judge:
Hon. Jose Rodriguez
Date:
October 2, 1996
Citation:
NYLJ, page 27, col. 1
Referred Statutes:
13 NYCRR 18.3(v)(5)(i)
Summary:
The respondent's aunt permanently vacated the apartment and landlord brought a non-payment proceeding. Although the niece's name was never placed on the annual recertification forms, various evidence (phone and utility records, testimony) indicated that she resided in the unit for years. The court ruled that she qualified as a remaining family member entitled to succeed to her aunt's Section 8 tenancy.

Case Caption:
Deepdale Gardens Third Corp. v. Knox
Issues/Legal Principles:
Guardian ad litem appointed for tenant in nuisance action
Keywords:
guardian ad litem; nuisance
Court:
Supreme Court, Queens County
Judge:
Hon. Satterfield
Date:
October 1, 1996
Citation:
NYLJ, page 26, col. 1
Referred Statutes:
CPLR 1201 & 1203
Summary:
Tenant defaulted and moved to stay the execution of the warrant of eviction and vacate the default judgment. The Department of Social Services (DSS) also moved for an order granting its agency to intervene for purposes of seeking the appointment of a guardian ad litem for the tenant. Tenant is a shareholder in a co-op building who failed to cure a violation alleging that she created a nuisance by among other things feeding and harboring cats and pigeons and creating an unhealthy condition by allowing the cats to defecate on the co-op's property, and that she was physically abusive to the other residents. DSS argued that the tenant could not adequately defend her rights as she was mentally unfit. Based on extensive psychiatric evidence, the court allowed DSS to intervene to be her guardian ad litem, vacated the default judgment, and set the matter down for a hearing on the nuisance allegations alleged by the co-op.

Case Caption:
Giuffrida v. Giuffrida
Issues/Legal Principles:
Father cannot evict son as licensee when son lives in the premises as an invitee of his mother who also owns the premises.
Keywords:
licensee
Court:
Civil Court, Yonkers County
Judge:
Hon. Doran
Date:
October 4, 1996
Citation:
NYLJ, page 27, col. 5
Referred Statutes:
RPAPL 713(7)
Summary:
The petitioner commenced a licensee holdover proceeding against his son who resided in the premises based on a notice stating that his son paid no rent and had no tenancy rights. The novel issue presented before the court was whether a legally emancipated son occupying premises owned by both his parents with the permission of the mother could be subject to a licensee proceeding instituted by the father. The son, 22 years old, lived with his mother in the premises by her invitation. An order of protection was in effect against the father to stay away from the home of his wife. Petitioner had also commenced divorce proceedings against his wife where he also sought exclusive possession of the premises. The court found that the son was not a licensee within the meaning of RPAPL Section 713(7) because he did not occupy the apartment by explicit or implicit agreement with his father, but rather his right flowed directly from his mother who, as an owner, had rights to grant her son a license to live with her. Since the father's holdover case was not challenging the mother's rights of possession, then the son's rights (which flowed from the mother's) could not be subject to a licensee proceeding. The court dismissed the petition.

Case Caption:
Matter of Sanders v. Holland
Issues/Legal Principles:
Section 8 rent subsidy is allowed for remaining family member
Keywords:
MCIs
Court:
Supreme Court, New York County
Judge:
Hon. Cahn
Date:
October 4, 1996
Citation:
NYLJ, page 22, col. 2
Referred Statutes:
RSC 2522.4(a)(2) & 2529.6; 9 NYCRR 2530.1
Summary:
This case involves 33,000 residents of Stuyvesant Town and Peter Cooper Village who challenged the owner, Metropolitan Life Insurance Company, regarding its installation of windows in the complex in 1991. Met Life sought two separate MCI applications to the DHCR in connection with the installation of the windows, one for each complex. Tenants immediately began complaining about defects in the windows, including spontaneous cracks or breaks, imploding windows causing glass to fly into apartments and other hazardous conditions. In June, 1994 Met Life submitted a report to DHCR concerning the fact that 2,199 apartments sustained window damage, about 1.5% of the windows in the complex. The tenants claimed 16% of the windows were effected. Apparently the window defects were due to a buildup of pressure in the argon gas used as an insulating material between the two panes of glass in the windows. A remedial device inserted in the windows was necessary and that work was not completed until late 1994. The DHCR rejected Met Life's MCI applications because they contained no information regarding the remedial work. Instead of re-submitting new applications, Met Life appealed the decision (i.e., filed a PAR) and did not submit the additional information about the remedial work until during the pendency of the PAR in 1995. On the PAR, Met Life was allowed to collect the MCI increases at $9 per room starting in 1993 for some tenants and 1994 for other tenants. The court ruled that the commissioner granting the PAR should not have ruled in Met Life's favor since the remedial work was not finished. Rather the court held the commissioner should have sent the case back to the district rent officer for a determination since it was improper for the commissioner to hear new evidence not presented to the initial hearing officer. The court noted that the tenants would then have an opportunity to contest the new evidence, as well as the current condition of the windows. The court enjoined the landlord from collecting the increases. Since Met Life's application should not be heard or granted until all the work was done, the judge's ruling created the effect of postponing the commencement date of the increases until the new DHCR rule is rendered, which could be at least a year.