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Jemrock Realty Co. v. Krugman

Court of Appeals of the State of New York
Jan 14, 2010
2010 N.Y. Slip Op. 211 (N.Y. 2010)

Opinion

No. 59 SSM 59.

Decided January 14, 2010.

APPEAL, by permission of the Appellate Division of the Supreme Court in the First Judicial Department, from an order of that Court, entered May 19, 2009. The Appellate Division affirmed an order of the Appellate Term of the Supreme Court in the First Judicial Department (op 18 Misc 3d 15), which had (1) reversed an order of the Civil Court of the City of New York, New York County (Jean T. Schneider, J.), entered after a non-jury trial, to the extent it determined that petitioner landlord was not entitled to a rent increase above the $2,000 luxury decontrol threshold based on improvements it had made to the subject apartment; (2) declared that petitioner was entitled to a rent increase above the $2,000 luxury decontrol threshold for improvements; and (3) remanded the matter to Civil Court for a determination of the rent arrears owed by respondent to petitioner. The following question was certified by the Appellate Division: "Was the order of Supreme Court, as affirmed by this Court, properly made?"

Following the departure of a long-time, rent-regulated tenant, petitioner renovated the apartment and increased the rent for respondent beyond the $2,000 luxury decontrol threshold due, in part, to the cost of the improvements to the property. Petitioner later commenced a nonpayment summary proceeding seeking rent arrears and possession of the apartment based on respondent's failure to pay rent.

Jemrock Realty Co. LLC v Krugman, 64 AD3d 290, reversed.

Barry J. Yellin, New York City, for appellant.

Abramson Law Group, PLLC, New York City ( Jeffrey A. Bodoff of counsel), for respondent.

Andrew M. Cuomo, Attorney General, New York City ( Monica Wagner of counsel), for New York State Division of Housing and Community Renewal, amicus curiae.

Chief Judge LIPPMAN and Judges CIPARICK, GRAFFEO, READ, SMITH, PIGOTT and JONES concur.


OPINION OF THE COURT

The order of the Appellate Division should be reversed, without costs, the case remitted to that court for further proceedings in accordance with this memorandum, and the certified question answered in the negative.

This case turns on the factual issue of whether the landlord's expenditures for "improvements" were at least equal to the amount (approximately $30,000) necessary to bring the legal rent above the luxury decontrol threshold. Contrary to the contentions of both parties, and to the majority and dissenting opinions at the Appellate Division, the resolution of that issue is not governed by any inflexible rule either that a landlord is always required, or that it is never required, to submit an item-by-item breakdown, showing an allocation between improvements and repairs, where the landlord has engaged in extensive renovation work. The question is one to be resolved by the fact-finder in the same manner as other issues, based on the persuasive force of the evidence submitted by the parties.

Here, the Appellate Term ( 18 Misc 3d 15), modifying the contrary decision of Civil Court, found that the landlord had met its burden of showing that its expenditures on improvements exceeded the requisite amount. The Appellate Division erroneously decided this question as a matter of law, and did not exercise its power to review the facts. We remit to the Appellate Division so that it may do so.

In memorandum.

On review of submissions pursuant to section 500.11 of the Rules of the Court of Appeals ( 22 NYCRR 500.11), order reversed, etc.


Summaries of

Jemrock Realty Co. v. Krugman

Court of Appeals of the State of New York
Jan 14, 2010
2010 N.Y. Slip Op. 211 (N.Y. 2010)
Case details for

Jemrock Realty Co. v. Krugman

Case Details

Full title:JEMROCK REALTY CO., LLC, Respondent, v. JAY KRUGMAN, Appellant

Court:Court of Appeals of the State of New York

Date published: Jan 14, 2010

Citations

2010 N.Y. Slip Op. 211 (N.Y. 2010)
2010 N.Y. Slip Op. 211
895 N.Y.S.2d 284
922 N.E.2d 870

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