Opinion
90011/03.
Decided January 29, 2004.
Greer Associates., P.C., New York City (Ida Greer of counsel), for petitioner.
Herzfeld Rubin, P.C., New York City (Edward Paulis of counsel), for respondent.
Petitioner moves for summary judgment based on a decontrol order issued by one of the DHCR's predecessor agencies and the expiration of respondent's lease. Alternatively, because petitioner alleges that respondent does not maintain the apartment as his primary residence, petitioner moves for discovery to ascertain his residence. Petitioner also moves to dismiss respondent's affirmative defenses and counterclaims. Petitioner's motion for an order under CPLR 3212 awarding petitioner a judgment of possession is granted. Petitioner's motion for an order under CPLR 3211 dismissing respondent's objections in points of law, affirmative defenses, and counterclaims is granted in part. Respondent's cross-motion for summary judgment and for discovery is denied. Petitioner's motion for discovery is denied as academic.
The parties agree that respondent began to occupy the premises in 1969 and never surrendered possession or control to petitioner at any time. On February 11, 1975, the New York City Department of Rent and Housing Maintenance, Office of Rent Control, issued a decontrol order based on respondent's nonprimary residence and decontrolled the premises. ( See Exhibit E to Petitioner's Motion.) Respondent protested the decontrol order. On July 23, 1975, the parties entered into a new lease. The last paragraph in the lease, ¶ 31, provides that "[i]t is understood that this apartment is not the primary residence of the Tenant." (Exhibit E to Petitioner's Motion for Summary Judgment at ¶ 31.) On March 15, 1976, the Department of Rent and Housing Maintenance issued an order dismissing the protest because no active issue remained for it to resolve. ( See Exhibit A to Petitioner's Motion.) Respondent never appealed the order dismissing the protest. The threshold issue before this court now is whether respondent became a rent-stabilized tenant of the subject decontrolled premises by entering into a standard-form lease with petitioner in July 1975.
Before the Omnibus Housing Act amended New York City Administrative Code § 26-504 (a) (1) in 1983, a landlord seeking to recover possession of a rent-controlled apartment based on a tenant's nonprimary-residence first needed an order of decontrol from the Rent Administrator/Commissioner. A landlord relied on this predicate order to prosecute a summary holdover proceeding or ejectment action. ( King Enterprises, Ltd. v. O'Connell, 172 Misc 2d 925, 930 [Civ Ct, NY County 1997].) A landlord who "obtained such a [decontrol] order could, at the expiration of the tenant's term, either evict or renew that tenant's lease at agreed terms, subject only to the forces of the marketplace." ( Kace Realty Co v. Levy, 127 Misc 2d 940, 941, [Civ Ct, NY County, 1985], affd 130 Misc 2d 858 [App Term, 1st Dept 1986, per curiam].)
The parties in this case did not proceed to court in 1975. They opted instead to enter into a new lease agreement. Petitioner argues that the parties entered into a non-regulated lease and that respondent even initialed an express provision at ¶ 31 of the lease to memorialize the decontrol order determination that the apartment is not his primary residence. Respondent argues that he is a protected rent-stabilized tenant and that ¶ 31 is void.
Respondent correctly notes that lease provisions that require tenants to represent that they may not use rent-stabilized units as their primary residence are void and unenforceable. ( See e.g. Draper v. Georgia Props., Inc., 230 AD2d 455, 458 [1st Dept 1997], affd 94 NY2d 809; Urban Assocs. v. Hettinger, 177 AD2d 439, 440 [1st Dept 1991, mem].) Petitioner distinguishes these cases because they did not involve decontrolled tenants remaining in possession. Petitioner argues that even if that lease provision is void, the decontrol order itself still operates to bar respondent's assertion of rent-stabilization protection. The decontrol order deregulated respondent's tenancy. Respondent never became a rent-stabilized tenant. Thus, the inclusion of ¶ 31 into the lease is irrelevant.
In support of its argument that respondent's tenancy is not protected, petitioner attaches numerous decisions by the Conciliation and Appeals Board, DHCR's predecessor. The decisions hold that under Section 5a (11) of Chapter 575, Laws of 1974 (Emergency Tenant Protection Act), apartments decontrolled by the Office of Rent Control because of nonprimary residence are fully exempt from rent regulation during the current tenant's occupancy and do not become subject to the Rent Stabilization Law unless and until the tenant vacates the premises and a new residential tenant takes occupancy. ( See attachments to Petitioner's reply: CAB Op. No. 21, 328, issued July 8, 1982, under Docket No. 01-9440; CAB Op. No. 26, 518, issued June 23, 1983, under Docket No. 01-8773; CAB Op. No. 21, 529, issued July 22, 1982, under Docket No. 62413-G; CAB Op. No. 24, 475, issued Jan. 27, 1983, under Docket No. 57567-G.) The court agrees with these persuasive CAB opinions, which outline the law this court is bound to follow. Although the next tenant to occupy the subject premises is entitled to rent-stabilization protection, the current tenant, who never vacated, is not.
In 1983, the Legislature, by the Omnibus Housing Act (L 1983, ch 403) transferred responsibility for administering the New York City Rent Stabilization and Rent Control Laws to DHCR, which assumed the regulatory functions of the CAB. ( Festa v. Leshen, 145 AD2d 49, 53-54 [1st Dept 1989].)
Before the passage of the Omnibus Housing Act of 1983 (L 1983, ch 403, §§ 41-42), nonprimary-residence disputes were resolved exclusively by the particular agency charged with administering the regulatory scheme. ( Berkeley Assocs. Co. v. Camlakides, 173 AD2d 193, 197 [1st Dept 1991, mem] [citing former section 18 of the State Rent and Eviction Regulations and City Rent, Eviction and Rehabilitation Regulations].) Respondent argues that the decontrol order and the CAB decisions lack validity because both the rent-control and rent-stabilization laws now require that "a court of competent jurisdiction" determine primary residence. ( See e.g. New York City Rent and Eviction Regulations [9 NYCRR] § 2200.2 [f] [18].) The court disagrees.
Because petitioner brought the administrative proceeding before the Omnibus Housing Act of 1983 transferred jurisdiction over nonprimary-residence cases to the courts, "the matter remained within the jurisdiction of the agency." ( Michel v. Hirabayashi, 129 Misc 2d 1081, 1082 [App Term, 1st Dept 1985, per curiam].) The decontrol order is binding on this court and is not subject to collateral attack. ( Id.; see e.g. West 95 Hous. Corp. v. Baultwright, NYLJ, Sept. 15, 2003, at 22, col 1 [App Term, 1st Dept, per curiam] [affirming Civil Court's finding that certificate of eviction issued by DHPD based upon tenant's nonprimary residence of a Mitchell-Lama apartment cannot be collaterally attacked in ensuing holdover proceeding].) Moreover, there was no legislative intent in 1983 that transferring jurisdiction over nonprimary-residence cases to the courts would give a tenant a grace period in which to re-establish primary residence. ( Matter of Stahl Assocs. Co. v. New York State Div. of Hous. Community Renewal, 148 AD2d 258, 267 [1st Dept 1989].) A tenant may not resume occupancy and thereby cure an earlier failure to occupy rent-regulated accommodations as a primary residence. ( Duell v. Sasaki, NYLJ Feb. 23, 1987, at 15, col 1 [App Term, 1st Dept 1987, per curiam].) Respondent's remedy was to appeal the dismissal of his protest.
The court is sympathetic to respondent's claim that petitioner is only now proceeding against him on the basis of a 29-year-old decontrol order. But rent-stabilization coverage is a matter of statutory right and cannot be created by waiver or estoppel. ( E.g. Ruiz v. Chwatt Assocs., 247 AD2d 308, 309 [1st Dept 1998, mem].) In Ruiz, the First Department affirmed the trial court's findings that a typewritten rider to the lease providing that the apartment was leased exclusively for professional purposes controlled over a preprinted clause providing that the "apartment was to be used by tenant and his family as 'a strictly private dwelling apartment.'" ( Id. at 308.) The Ruiz court declined to award the tenant rent-stabilization protection even though he lived in the premises for 30 years. The court stated that the certificate of occupancy and other evidence established that the apartment was leased exclusively for professional purposes even though the landlord mistakenly registered the apartment over the years as rent stabilized and requested rent increases in conformity with rent-stabilization guidelines. ( See id.) Here, although petitioner chose to continue respondent's occupancy at terms advantageous to him, doing so did not vest stabilization rights to the apartment in this respondent. ( See New York Univ. v. Benison, NYLJ, Oct. 26, 1988, at 21, col 3 [App Term, 1st Dept, per curiam].)
Respondent's first objection in point of law alleging that petitioner improperly served a termination notice under RPAPL 735 is denied as conclusory and moot. Petitioner served respondent in the manner the lease required. Respondent's second objection in point of law alleging that petitioner failed to meet the "reasonable application" standard of RPAPL 735 before resorting to conspicuous place service of the petition and notice of petition is denied. The affidavit of petitioner's process server reveals that he made two attempts, one during working hours and one during non-working hours, before affixing and mailing the copies of the petition and notice of petition. Respondent's first affirmative defense alleging that petitioner's claim fails to support a cause of action is denied because the decontrol order is entitled to collateral-estoppel effect and because respondent's tenancy is not subject to rent-stabilization protection for the reasons set forth above. Respondent's second affirmative defense, which argues without explanation that this court lacks subject matter jurisdiction, is denied. Respondent's first counterclaim for harassment is severed. Respondent's second counterclaim for attorney fees is denied.
Petitioner's motion for a final judgment of possession is granted. Warrant to issue forthwith. The proceeding is adjourned to February 24, 2004, at 9:30 for a hearing to determine to what date the execution of the warrant shall be stayed.
This opinion is the court's decision and order.