Tenant restored the case to the calendar and the court directed the landlord to pay tenant's additional storage costs until the date the tenant was restored to possession and further directed that landlord complete construction so that tenant could be restored by September, 2001. Tenant was finally restored to possession in late November, 2001. The landlord appealed the judge's order but the Appellate Term upheld the requirement that the landlord pay these fees on grounds that from the face of the stipulation the parties anticipated that the necessary renovations would be completed by December 2000. But since tenant was not restored until one year later, under these circumstances the housing court's provision for continued payment of tenants' storage fees constituted an appropriate adjustment for the additional time that tenant remained out of possession.

The court disagreed and cited cases which laid out the rationale and purpose of Section 8 tenancies. The court held that if it accepted the landlord's theory then such a ruling would encourage all sorts of conspiracies between landlords and tenants, and thereby subvert the federal law for Section 8 tenancies. The landlord's position must be rejected because it would encourage fraud on the federal agency. It would also place low income tenants at the mercy of less scrupulous landlords who would be the ones demanding and coercing extra rent money in exchange for the right to lease the premises. Such landlords would later be able to say that the payments were "voluntarily" made by the tenant, and then judges would be in the position of determining whether it was consensual or not. To avoid such scenarios, a single bright-line policy of no payments in excess of the Section 8 rent is necessary.

Tenant had filed a disability compliant with the federal government stating that she needs her dog for comfort and companionship to help her cope with her disability and that the landlord is discriminating against her. She has had the dog for four years and claims that it alleviates some of the fear and pain and depression arising from acute hypothyroid and severe advanced rheumatoid arthritis. She produced five affidavits from neighbors who say the dog is not a disturbance.

The tenant's lawyer now seeks to stay (i.e., freeze) the Housing Court eviction proceeding pending the outcome of the federal disability case. The lawyer cited to two cases where stays were granted but each of those cases involved allegations that the tenant harbored a dog in violation of the lease clause prohibiting such ownership of a pet. Neither of those cases involved a nuisance. As a result the court felt compelled to deny the stay and set the matter down for trial. The court concluded that if a nuisance is found the tenant will either have to get rid of her dog or vacate the apartmentþand this is the result even if federal court later determines that the landlord acted in a discriminatory manner with respect to her disability.

The court denied tenant's request to dismiss the petition on grounds that the petition failed to properly characterize the apartment as a co-op rented to a tenant since Paikoff v. Harris, the leading case likewise did not dismiss that landlord's petition for such an omission in the petition. Further the court noted that a notice to cure must be served if required by statute or written agreement and that neither applied in this case. Absent statutory authority, the court declined to impose such a requirement on the landlord. The court denied the tenant's request to dismiss the petition.

In response, the landlord challenged the Court's adjournment by commencing an Article 78 proceeding, naming the Housing Court Judge as a Respondent. The landlord did not argue that the Court's action was arbitrary and capricious. Instead, the landlord argued that absent consent of all parties, the law requires that an adjournment be no more than 10 days. The landlord requested the Supreme Court to direct the Civil Court judge to cease and desist from granting more than 10 day adjournments.

As an initial step, the Court held that the proper mechanism for the relief sought by the landlord would be a mandamus action (which compels an officer to perform a legal duty, but does not direct how to perform it) as opposed to a declaratory judgment action (which adjudicates the parties' rights prior to litigation in an attempt to stop an alleged wrong from being committed). The Court then turned to the question of whether the Civil Court judge's action was permissible under the applicable law, holding that the Judiciary Law vests in the Court the inherent power and discretion to control its own calendar. The Court further held that legislature could not limit this discretionary power. The Court noted that in this case, the Court made a "particularized judicial inquiry" prior to granting an adjournment beyond the 10 days mandated by statute.

The Appellate Division held that the tenant's association did have standing to challenge the issuance of the Certificate of No Harassment and that the doctrine of mootness did not foreclose the appeal since the issues presented were substantial and likely to recur while typically evading review. Nonetheless, the Court found that the challenges to the issuance of the certificate to be unpersuasive, holding that DHPD was not required to hold a hearing on the allegations of harassment insofar as it was in the agency's discretion to hold a hearing if the Commissioner has reasonable cause to believe that harassment has occurred. The Court further held that the record reflected that DHPD fulfilled its obligation to investigate the claims of harassment and that the ultimate determination to issue a certificate of no harassment was not arbitrary or capricious.

The Court denied landlord's claim for legal fees holding that where a stipulation of settlement is silent as to fees and settles a proceeding in its entirety, a party may not later seek fees absent a reservation of rights. The Court noted that breach of the probationary stipulation was a foreseeable circumstance and could have most certainly been contemplated by the parties. As a result, the Court denied the landlord's request for fees incurred at the hearing resulting from the tenant's breach.

However, the Court held that the landlord would be entitled to fees incurred as a result of tenant's appeal of the Court's decision and order. The Court held that the tenant's appeal was an unforeseeable circumstance, that could not have been contemplated by the landlord when entering into the stipulation of settlement.

While the Court found that an overcharge existed by operation of law, the actual amount of the overcharge would have to be determined at a hearing, as there was a dispute over whether the apartment was rented furnished. In such a case, the prime tenant would have been entitled to a ten percent surcharge over and above the legal regulated rent. If the apartment was not furnished, then the prime tenant was not entitled to collect in excess from the legal regulated rent. Although the sublease agreement and the prime tenant's affidavit state that the apartment would be rented furnished, the subtenants allege that the apartment was not furnished when they took possession.

The prime tenants further argued that to the extent they were not aware of the legal rent, the overcharge was not wilful and therefore treble damages could not be awarded. The Court looked to the renewal lease signed by the prime tenants with their landlord and held that the overcharge was in fact wilful. The Court further held that when an overcharge is found to be wilful, the award of treble damages is mandatory, not discretionary as is the award of reasonable attorney's fees.

The Legal Aid Society appeared on behalf of tenant, and moved for reargument and renewal of the Court's refusal to vacate the default, claiming that RPAPL 745 did not permit the Court to order a rent deposit on the first Court appearance, and that the building was an unregistered de facto multiple dwelling and not in compliance with the certificate of occupancy, which only permitted a one family residence.

The Court granted renewal and vacated the default based upon the landlord's lack of compliance with the certificate of occupancy and lack of a multiple dwelling registration. The Court noted, however, that once the landlord became compliant with the certificate of occupancy (i.e. once the landlord removed the illegal apartments or legalized them), that the tenant would be responsible for all accrued rent. The Court rejected the tenant's argument that it had no power to order the rent deposit, noting that RPAPL 745 merely makes rent deposits mandatory, but does not preclude the court from making other orders to deposit undisputed rent, even on the first court appearance, in the interests of justice.

The Court found that such claims of a horizontal multiple dwelling could not be resolved on summary judgment, as disputes of material facts required trial. The Court noted that horizontal multiple dwelling status cases are decided on a case by case basis.

As to other requests for relief made by the parties, the Court dismissed the tenant's cause of action seeking sanctions for frivolous conduct as improper, noting that such a request for relief must be made by motion, not pled as a cause of action. The Court also dismissed tenant's counterclaim for retaliatory eviction without prejudice, noting that the tenant failed to properly plead the claim within the statutory framework of Real Property Law 223-b. The Court denied the tenant's request for attorney's fees as premature. The Court granted the landlord's motion to strike tenant's affirmative defenses of estoppel or waiver based upon the landlord's registration of the subject unit as rent stabilized with DHCR and the landlord's prior pleadings in Housing Court actions where the landlord pled that the unit was rent stabilized, recognizing that rent stabilization cannot be created by waiver or estoppel. The Court, noting that the motions were prepared two years before the date of decision, declined to award use and occupancy at market rates prior to a conference on the issue of rent status. Finally, the Court dismissed the landlord's request that the tenant's nine year "sweetheart lease" and subsequent lease modification was void for unconscionability, noting that the element of lack of meaningful choice of the prior lessor could not be satisfied, since the prior owner/landlord was the tenant's father. The Court recognized that prior case law specifically rejected a subsequent owner's attack of its predecessor's preferential lease made with a relative.