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2 NY3d 472
ATM One, LLC v. Landaverde
*1 In the Matter of ATM One, LLC, Appellant,
v.
Ana Landaverde, Respondent.
No. 75
Court of Appeals of New York
Decided on June 3, 2004
POINTS OF COUNSEL
Paula Schwartz Frome, for appellant.
Stefan Krieger, for respondent.
GRAFFEO, J.:
In this appeal, the owner of a building challenges the dismissal of its holdover proceeding against a tenant allegedly violating the maximum occupancy provision of the parties' lease. We conclude that the proceeding was properly dismissed because the tenant was not afforded 10 days written notice to cure the alleged violation.
Section 2504.1 of the Division of Housing and Community Renewal's Emergency Tenant Protection Regulations sets forth restrictions regarding the removal of a tenant in a rent-stabilized housing accommodation. Prior to commencing a proceeding to recover possession *2 based on a tenant's wrongful act, an owner must give the tenant written notice to cure (9 NYCRR 2504.1 [d][1] [i]). The notice must state the wrongful acts of the tenant, the facts necessary to establish such acts and "the date certain by which the tenant must cure said wrongful acts or omission, which date shall be no sooner than 10 days following the date such notice to cure is served upon the tenant" (id. at [c] [emphasis added]). A proceeding may not be maintained if the tenant cures the specified wrongful act "by or before the date specified" (id. at [d][1] [ii]). At the time relevant to this appeal, the regulations also provided that
"[n]otices, orders, protests, answers and other papers may be served personally or by mail. When service is made personally or by mail, an affidavit by the person making the service or mailing shall constitute sufficient proof of service. When service is by registered or certified mail, the return post office receipt shall constitute sufficient proof of service"
(9 NYCRR 2508.1 [a]) [FN1].
Respondent-tenant leases a one-bedroom apartment in Freeport, New York from petitioner-owner. On September 8, 2000, owner served tenant with a "Notice of Default; Ten Days' Notice to Cure; Thirty Days' Notice of Cancellation," alleging overcrowding in violation of the lease. The notice was sent by certified and regular mail on September 8, 2000, and set a "date certain" of September 18, 2000 for cure. It is undisputed that tenant received the notice on September 9, 2000, thus affording her only nine days to cure.
After expiration of the 30-day cancellation period, owner commenced this holdover proceeding against tenant. Tenant moved to dismiss the petition on the basis that she did not receive the mandated 10-day opportunity to cure. Owner opposed the motion, arguing that the 10-day period commenced upon mailing of the notice on September 8 and that tenant therefore received the requisite time to cure.
District Court dismissed the petition. In order to address the failure of the regulations to define when a mailed notice to cure shall be deemed served, the court "borrow[ed] the concept embodied in" CPLR 2103 by requiring owners to add five days to the prescribed period when serving by mail. Upon granting reargument, District Court adhered to its determination. Appellate Term affirmed. Although it agreed with District Court's rationale "that the regulatory purpose was to afford a tenant the full 10 days prescribed in which to cure a breach," the court rejected the addition of five days for service by mail in favor of a rule that service is complete upon delivery (190 Misc 2d 76, 77 [2001]). Owner appealed.
The Appellate Division also affirmed the dismissal of owner's petition. The court defined service under the regulations "in terms of receipt rather than in terms of mailing" to effectuate the underlying policies and avoid "the possibility that, in a case involving an abnormally extended delay in the delivery of the mail, a tenant might not be told of the date within which he or she may cure a violation until after that date has actually passed" (307 AD2d 922, 923 [2d Dept 2003]). Two Justices dissented and voted to reinstate the petition. The dissenting Justices viewed the plain meaning of the regulations as establishing that "the date of *3 service is the date [the notice] was mailed as evidenced by a contemporaneous affidavit of service" and expressed concern that the court's holding rendered the provision permitting service by mail ineffective because the owner "will never be able to know when the notice is actually received" (id. at 925). The Appellate Division granted owner leave to appeal to this Court.
Owner urges that, under the plain meaning of the regulations, service of the notice to cure was complete on September 8, the date the notice was mailed. Owner thus contends that the notice's September 18 date certain complied with the regulations, notwithstanding that once tenant received the notice she had only nine days to rectify her alleged lease violation. In contrast, tenant asserts that because the regulations are silent with respect to when service of a mailed notice to cure is deemed complete, the courts below properly looked to the policies and intent underlying the regulations to resolve the issue. In light of these considerations, tenant argues that the regulation entitles her to the full 10-day cure period before a holdover proceeding may be maintained and that this Court should adopt District Court's approach and require owners who mail notices to add five days when calculating the date certain by which tenants must cure. We agree with tenant and therefore affirm.
In matters of statutory and regulatory interpretation, we have repeatedly recognized that
"legislative intent is the great and controlling principle, and the proper judicial function is to discern and apply the will of the [enactors]. Generally, inquiry must be made of the spirit and purpose of the legislation, which requires examination of the statutory context of the provision as well as its legislative history"
(Mowczan v Bacon, 92 NY2d 281, 285 [1998] [internal citations and quoted cases omitted]; see Sutka v Conners, 73 NY2d 395, 403 [1989]). We are further guided by the tenet that regulations -- like statutes -- should be construed to avoid objectionable results (see People v Dozier, 78 NY2d 242, 250 [1991]; McKinney's Cons Laws of NY, Book 1, Statutes § 141; see also 2 NY Jur 2d, Admin Law § 184 [administrative regulations generally subject to same canons of construction as statutes]).
DHCR adopted the regulations at issue in this case pursuant to its powers under the Emergency Tenant Protection Act of 1974 (ETPA) (see 9 NYCRR 2500.1). The Legislature enacted the ETPA to address the "serious public emergency" in housing across New York State as evidenced by "an acute shortage of housing accommodations" (McKinney's Uncons Laws of NY § 8622; L 1974, ch 576, as amended). In the legislative findings for the most recent extension of the Act, the Legislature determined that "preventive action . . . continues to be imperative in order to prevent exaction of unjust, unreasonable and oppressive rents and rental agreements and to forestall profiteering, speculation and other disruptive practices tending to produce threats to the public health, safety and general welfare" (id.).
As every court to consider this case thus far has recognized, the regulation that purports to answer the question of when service of a notice is complete does not actually do so. It identifies permissible service methods and what constitutes proof of service but fails to specify when such service is deemed to have occurred if service by mail is utilized. Reading the service provision (9 NYCRR 2508.1 [a]) together with the notice to cure regulation (9 NYCRR 2504.1 [d]), we conclude that District Court's approach best effectuates the regulatory purpose to afford tenants a 10-day cure period before they may be subject to lease termination for designated *4 violations. We therefore hold that owners who elect to serve by mail must compute the date certain by adding five days to the 10-day minimum cure period (see e.g. CPLR 2103 [b][2]). In this manner, service will be deemed complete upon mailing, and a properly executed affidavit of service will raise a presumption that proper mailing occurred (see Kihl v Pfeffer, 94 NY2d 118, 122 [1999]; Engel v Lichterman, 62 NY2d 943, 944-945 [1984]). "[M]ere denial of receipt is not enough to rebut this presumption" (Kihl, 94 NY2d at 122) [FN2]. By its terms, of course, CPLR 2103 applies to pending actions, and we therefore do not extend its applicability to the commencement of summary proceedings. We agree with District Court, however, that the addition of a definite number of days is necessary for service by mail to ensure that tenants are not disadvantaged by an owner's choice of service method, and that such an addition provides a practical and fair solution to this regulatory ambiguity.
The rule advocated by owner -- which would define the act of mailing as completion of service and permit owners to calculate the "date certain" from that starting point -- is inconsistent with regulatory purpose to provide tenants a 10-day opportunity to cure and would lead to unpredictable results. The Appellate Division and Appellate Term rule, deeming service complete upon a tenant's receipt of the notice, is similarly flawed because an owner could not reliably compute and insert the date certain on the notice as required by the regulations. Instead, the rule we adopt balances the need for orderly and efficient resolution of lease violations with the stated legislative purposes of the ETPA. Here, the subject notice did not form a valid predicate for terminating the lease because the date certain as established by owner, when paired with the chosen service method, did not provide tenant the minimum 10- day cure period. Thus, owner's holdover proceeding was properly dismissed on this ground. We encourage DHCR to amend its regulations consistent with this determination in order to provide better guidance to parties who elect to serve notices to cure by mail.
Accordingly, the order of the Appellate Division should be affirmed, with costs. The certified question should not be answered upon the ground that it is unnecessary.
* * * * * * * * * * * * * * * * *
Order affirmed, with costs. Certified question not answered upon the ground that it is unnecessary. Opinion by Judge Graffeo.
Chief Judge Kaye and Judges Smith, Ciparick, Rosenblatt, Read and Smith concur.
Decided June 3, 2004
FOOTNOTES
FN1. The regulation was subsequently amended to permit electronic service, among other changes.
FN2. Indeed, the amended version of section 2508.1 (a) expressly provides that "[o]nce sufficient proof of service has been submitted to the division, the burden of proving nonreceipt shall be on the party denying receipt."
Copr. (c) 2004, Randy A. Daniels, Secretary of State, State of New York.
END OF DOCUMENT
Southbridge Towers, Inc. v. Frymer
2004 N.Y. Slip Op. 24269
N.Y.City Civ.Ct. 2004.
Decided on July 27, 2004
SOUTHBRIDGE TOWERS, INC.,Petitioner-Landlord,
v.
JOSEPH FRYMER,Respondent-Cooperator, JOACQUES PONCET and "JOHN" and "JANE DOE,"
Respondents-Occupants.
57777/2004
Civil Court of the City of New York, New York County
Decided on July 27, 2004
APPEARANCES OF COUNSEL
Szold & Brandwen, P.C., New York City (Mia D. Falls, Dean M. Roberts, and Michael A. Valentine of counsel), for petitioner. Michael J. Berman & Associates, P.C., New York City (Michael J. Berman), for respondent.
OPINION OF THE COURT
Gerald Lebovits, J.
Petitioner Southbridge Towers, Inc., commenced this holdover proceeding after terminating respondent Joseph Frymer's right to occupy the premises for alleged Occupancy Agreement violations. Respondent moves to dismiss pre-answer. Petitioner opposes that motion and cross-moves for use and occupancy.
This is respondent's second pre-answer motion to dismiss. In his first pre-answer motion, respondent argued that the petition set forth an incorrect multiple dwelling registration number for the premises. Petitioner then cross-moved to correct the registration number. The court denied respondent's motion and granted petitioner's motion.
In this motion, his second pre-answer motion, respondent raises two new issues. He argues, first, that the termination notice contains insufficient factual allegations to maintain the proceeding. Under CPLR 3211 (e), the court is unable to entertain this argument in a second motion to dismiss. Respondent also argues that petitioner's notice to cure, as mailed, did not allow him adequate time to cure. This argument is based on a Court of Appeals's opinion decided after respondent filed and the court adjudicated his first pre-answer motion to dismiss. (See Matter of ATM One, LLC v Landaverde, 2 NY3d 472 [2004].) Respondent may therefore raise it in a second pre-answer motion to dismiss. The court agrees that petitioner's notice to cure gave respondent insufficient time to cure and therefore dismisses the petition. Petitioner's cross-motion for use and occupancy is denied as academic.
I. Facts
The facts are undisputed. Southbridge Towers is a Mitchell-Lama co-operative housing *2 development formed, organized, and operated as a limited-profit housing company under Article II of the New York State Private Housing Finance Law. The subject apartment is not subject to rent control or rent stabilization; it is in a building owned by a publicly funded cooperative corporation. But Southbridge Towers is subject to the rules and regulations of the New York State Division of Housing and Community Renewal (DHCR).
Petitioner alleges that in violation of paragraph 19 (A) (h) of the Occupancy Agreement and 9 NYCRR 1727-5.3, respondent has not occupied the subject premises as his bona fide principal place of residence. (See Affirmation in Support of Petitioner's Cross-Motion at ¶ 5.) Peititoner also alleges that respondent has sublet or assigned his right to occupy the apartment to Jacques Poncet. Petitioner further alleges that respondent made false statements on his annual income affidavit concerning his household income. (See Affirmation in Support of Petitioner's Cross-Motion at ¶ 5.)
On February 4, 2004, petitioner mailed respondent a five-day notice to cure. Petitioner chose to serve the notice by mail alone. (See Affidavit of Service of Five-Day Notice to Cure.) The cure notice enumerated respondent's alleged violations and required that he cure by February 11, 2004. (See Petition at Attachment 3.) On February 12, 2004, petitioner mailed respondent a termination notice. The notice stated that respondent must quit the apartment by February 18, 2004. Respondent refused to quit the apartment, and petitioner brought this proceeding on February 19, 2004.
In his second pre-answer motion to dismiss, respondent argues that because no notice to cure is annexed to the termination notice he received, the termination notice does not contain sufficient factual allegations to support this holdover proceeding. (See Respondent's Second Motion to Dismiss at ¶ 5.) The court may not entertain this motion. A respondent may make only one motion to dismiss. (CPLR 3211 [e].) This rule is signed to avoid duplication because the movant can join in the one motion whatever grounds she has." (David D. Siegel, N.Y. Prac § 273, at 432 [3d ed. 2004].)
In his second pre-answer motion to dismiss, however, respondent also argues that petitioner's notice to cure did not allow him sufficient time to cure. A notice to cure is important to tenants. The lease between the parties allows petitioner to terminate respondent's tenancy for substantial violations but also requires that petitioner notify respondent of the alleged violations by a notice to cure. The five-day notice to cure is all that stood between respondent and a holdover proceeding. The notice, served on February 4, 2004, required that respondent cure by February 11, 2004. (See Respondent's Second Motion to Dismiss at ¶ 4.) This allowed respondent only seven days to cure, including the time the notice was in the mail.
According to respondent, a recent Court of Appeals opinion, which affirmed a Second Department opinion but also created a new rule, applies to this proceeding. Respondent's argument is based on that case: Matter of ATM One, LLC v Landaverde (2 NY3d 472 [2004]). Because the Court of Appeals decided Landaverde on June 3, 2004--respondent's first motion to dismiss was made on March 25, 2004, and decided on April 29, 2004--respondent's argument is based on new law and can be presented to the court in a second motion to dismiss, thus providing an exception to CPLR 3211 (e).
The one-motion rule does not bar a court from considering additional defenses raised for the first time in a second motion when they could not have been submitted earlier. (See *3 Held v Kaufman, 91 NY2d 425, 430 [1998].) Although in Held the defendants' additional defenses could not have been " submitted at an earlier juncture because of the indefiniteness of plaintiff's initial pleading," (id.), Held applies here because respondent had no basis to submit his papers earlier. The decision on which respondent's second motion is based--Landaverde--had not yet been rendered.
II. The Landaverde Rule
In Landaverde, a landlord brought a holdover proceeding against a tenant. The tenant received the notice to cure nine days before the date by which she needed to cure, although the applicable regulation--9 NYCRR 2504.1 [d] [1] [i] [c]--afforded the tenant at least ten days within which to cure, according to the Second Department. (See Matter of ATM One, LLC v Landaverde, 307 AD2d 922, 922-923 [2d Dept 2003].) The Second Department noted that there was "no provision in the applicable [DHCR rent-stabilization] regulations that specifie [d] whether . . . the service is deemed to have occurred (a) at the moment that the notice was delivered to an agent of the postal service . . . ,(b) at the moment that the notice was delivered to the address of the tenant . . . ,or (c) at the moment that the tenant personally opened the envelope and received the notice . . . ." (Id.)
The Second Department found in Landaverde "that to define service in terms of receipt rather than in terms of mailing is more consistent with the policies underlying the [DHCR's] regulations." (307 AD2d at 923.) Under the Second Department's holding, it is possible that the notice to cure in this proceeding afforded respondent adequate time to cure. The notice was mailed on February 4, 2004, and required that respondent cure by February 11, 2004. Assuming that respondent received the notice by February 6, 2004, respondent would still have had five days to cure.
On June 3, 2004, however, the Court of Appeals affirmed the Appellate Division's decision in Landaverde but developed a new rule: Landlords who elect to serve by mail must "compute the date certain by adding five days to the . . . minimum cure period." (Landaverde, 2 NY3d at 477.) Under this rule, petitioner would have had to mail the notice by February 1, 2004, to require respondent to cure by February 11, 2004.
The issue, then, is whether Landaverde applies to this proceeding. If so, then petitioner's notice to cure is invalid.
III. The Possible Applicability of Landaverde
In Landaverde the Court of Appeals held that landlords who elect to serve by mail must assume that the cure notice could spend five days in the mail before a tenant might receive it. (See 2 NY3d at 477.) By its terms, Landaverde applies only to rent-stabilized apartments subject to the DHCR's regulations enacted under the Emergency Tenant Protection Act (ETPA). The Court of Appeals found DHCR's requirements regarding the landlord's service of its notice to cure by mail so vague as to merit the clarification it provided in Landaverde. The Court of Appeals held that "the addition of a definite number of [five] days . . . provides a practical and fair solution to this regulatory ambiguity." (Id.) The Court also held that service under the law is deemed complete on mailing. (Id. at 478.)
Petitioner is a Mitchell-Lama housing co-operative regulated by DHCR; it is not subject *4 to the ETPA. Moreover, no DHCR regulation concerning service of notices to Michell-Lama co-operators requires petitioner to add an additional five days to the cure period when it mails a notice to cure. Nonetheless, the principles behind Landaverde apply to Mitchell-Lama co-operatives.
The Court of Appeals found in Landaverde that "[i]n matters of statutory and regulatory interpretation . . . 'legislative intent is the great and controlling principle . . . .'" (Landaverde, 2 NY3d at 476-477, quoting Mowczan v Bacon, 92 NY2d 281, 285 [1998].) The regulations at issue in Landaverde were adopted pursuant to the ETPA; the Court noted that "[t]he Legislature enacted the ETPA to address the 'serious public emergency' in housing across New York State as evidenced by 'an acute shortage of housing accommodations.'" (Id. at 477, quoting McKinney's Unconsol. Laws of N.Y. § 8622; L 1974, ch 576, as amended.) The Court explained that with the concerns underlying the ETPA, requiring landlords to compute an additional five days when serving cure notices by mail lances the need for orderly and efficient resolution of lease violations with the stated legislative purposes of the ETPA." (Id.)
The stated purposes of the ETPA are similar to those behind the Mitchell-Lama program: Both were created to address a housing problem. When the New York Legislature enacted the Mitchell-Lama program in 1955, it "declared that there exists in municipalities in this state a seriously inadequate supply of safe and sanitary Dwelling[s] . . . ; that such conditions are due, in large measure, to over-crowding and concentration of the population . . . ; that such conditions constitute an emergency . . . necessitating speedy relief . . . ." (Private Housing Finance Law § 11.)
Furthermore, as petitioner itself notes, DHCR has not enacted a regulation concerning service of cure notices to Mitchell-Lama co-operators. If the Court of Appeals found DHCR's regulation regarding cure-time measurement unclear, more unclear yet is the absence of any regulation. Both rationales the Court stressed in Landaverde--"the need for orderly and efficient resolution of lease violations [and] the stated legislative purposes of the ETPA" (2 NY3d at 478)--exist in relation to Mitchell-Lama co-operatives.
The notice to cure afforded respondent insufficient time to cure: It did not account for the need to add five days for a cure notice sent by mail. Respondent's motion to dismiss is therefore granted.
This opinion is the court's decision and order.
Dated: July 27, 2004J.H.C.
Copr. (c) 2004, Randy A. Daniels, Secretary of State, State of New York.
N.Y.City Civ.Ct. 2004.
Southbridge Towers, Inc. v Frymer
END OF DOCUMENT