Opinion
76402/10.
Decided April 14, 2011.
Petitioner was represented by: Mirtha C. Sabio, Esq., Kraus Kraus, LLP, Long Island City, NY.
Respondent was represented by: Sarah R. Robinson, Esq., Bushwick Housing Legal Assistance, Brooklyn, NY.
At issue in this non-payment proceeding is whether the petitioner is barred from seeking to collect the contract rent where the respondent's Section 8 subsidy was terminated as a result of her failure to disclose additional household income.
The respondent moves to dismiss this proceeding alleging that the petitioner is seeking rent that is not owed by her because it was to be paid by NYCHA as part of its Section 8 program.
The respondent has lived in the subject premises for over 33 years. She claims that she should not be responsible to pay her entire rent because she never signed a new lease agreeing to pay the amount that had previously been paid by Section 8 before it was terminated.
The respondent relies, inter alia, on Dawkins v Ruff , 10 Misc 3d 88 (AT 2nd Dept. 2005) and Licht v Moses, 2006 NY SlipOp 26079 (AT 2nd Dept. 2006) where the Appellate Term held that nonpayment proceedings cannot lie to recover that portion of the rent that was covered by Section 8, even where the subsidy was properly terminated, in the absence of a new agreement in which the tenant agrees to pay the non-tenant share.
It is the respondent's position that as a Section 8 recipient she did not become liable for the contract rent owed unless she signed a new lease agreement to pay the entire contract rent notwithstanding the termination of her subsidy.
In the case at bar, as set forth in the Petition (¶ 7): "The mortgage on the premises is held by the City of NY Pursuant to Art. 8 Sect. 405 of the Private Housing Finance Law, the apt. is not subject to New York City Rent Law (Rent Control) or stabilization."
On July 23, 2003, the respondent entered into a lease for the subject premises located at 260 So. 1st Street, Brooklyn, New York in the development known as Development Associates Buff. The relevant portions of said lease, for the purposes of this proceeding, read as follows:
Article I — Terms of Lease
Section 1.01. The initial term of this Lease shall commence on 12/1/2003 and end on 11/30/2004 (the " Initial Term"), unless sooner terminated as hereinafter provided, with an automatic extension commencing on 12/1/2004 and ending on 11/30/2006 (the " Extension", the Extension and the Initial Term, collectively, shall be referred to herein as the " Term"). After the Term ends, the lease shall continue for successive terms (a " Successive Term") of one year each unless the Landlord notifies the Tenant in writing of the Landlord's intention not to renew the Lease or honor any Successive Term or the Tenant Notifies the Landlord of the Tenant's intention to vacate the Apartment as provided for in Section 9.01(a). The end of the Initial Term shall not constitute an end of Term hereunder.
Article II — Rent
Section 2.01 Payment of Rent. The annual rent of $13608.00 is payable in equal monthly installments of $1,134, each in advance on the first day of each calendar month during the Initial Term, the first of said installments to be paid on the signing of this Lease; provided, however, that, at the end of the Initial Term, and continuing through the remainder of the Term and any Successive Term thereafter, the Landlord may raise the rent in accordance with Section 2.02, and such annual rental payment shall be payable in equal monthly installments on the first day of each month during the Extension or any Successive Term; provided further, that, if the Landlord exercises his right to raise the rent under Section 2.02, Landlord shall provide Tenant with a written notice of the new market rent for the period then commencing (a " Market Rent Notice"). . . .
Section 2.02. Changes in the Tenant's Rent. The tenant agrees that, upon the expiration of the Initial Term, the rent payable pursuant to Section 2.01 may be subject to an annual increases [sic] during the Extension or any Successive Term, equal to any amount approved through a Rent Order by the Commissioner of the New York City Department of Housing Preservation and Development pursuant to authority under Article VIII of the Private Housing Finance Law.
In contrast to rent stabilized leases, which are renewable at the tenant's option for one or two year terms, the lease herein, as set forth above, has indefinite one year terms ("Successive Terms") unless otherwise terminated by either party. Thus, the respondent is not in the same position as a rent stabilized tenant and the holdings in Dawkins v Ruff, and Licht v Moses, supra, are not binding.
The Court finds that the respondent's argument that the lease "does not specifically state that the respondent will pay the amount alleged to be the total rent in the 2003 lease, merely that it is payable'" is without merit. There are only two parties who executed the lease, the managing agent and the respondent. There is no reference to payment by Section 8 or that if respondent does receive a subsidy she can never be held liable for the full contract rent upon termination of the subsidy.
In Rosario v Diagonal Realty , 8 NY3d 755 , 760, the Court of Appeals held that "a landlord's determination to accept federal Section 8' rent subsidy payments is a term and condition' of a lease executed with a rent stabilized tenant . . . so that a renewal lease must continue with that term and condition." (Emphasis added)
However, as noted above, the petitioner states that it is not subject to rent stabilization and, at this juncture, the respondent has not provided any documentary evidence to dispute this claim, or to prove that she is, in fact, a rent stabilized tenant, other than her mere assertion. Nor has respondent demonstrated that a new rent stabilized lease was entered into subsequent to the instant lease of 2003 that would be subject to the holding enunciated in Rosario, supra.
The respondent was notified by DHPD on April 23, 2010 that her Section 8 subsidy was terminated and that she was obligated to pay the entire contract rent for her apartment. (P Sur-Reply Aff, Ex. "B")
On May 2, 2008, DHCR modified the tenant's rent to $1308. On July 17, 2008, as a result of a utility deduction, that amount was reduced by $59 to $1249 which is the amount of monthly rent sought in the Petition.
As stated in 402 Nostrand Avenue Corp. v Smith, 2008 NY SlipOp 28119, (AT 2nd Dept. 2008), cited by the respondent, "we note the tenant's contentions that the rent demand and petition are defective because they demanded the higher amount, and that the proceeding must, as a consequence, be dismissed, is without merit. The rent demand and petition permissibly set forth landlord's good faith claim as to the rents due and the period for which they were due (citation omitted).
For the reasons set forth above, the Court does not find that dismissal of the Petition is warranted. Nonetheless, the respondent retains her right to challenge the regulatory status of the subject premises during the petitioner's prima facie case at trial.
Accordingly, the respondent's motion to dismiss the Petition is denied. This matter will be restored to the Court's calendar on May 26, 2011 for trial.
This constitutes the Decision and Order of the Court.