Opinion
157017/2016
03-25-2019
Deganit NUUR, Plaintiff, v. 223 AVENUE B, LLC, Defendant.
Plaintiff: Fishman Rozen, LLP 305 Broadway, Suite 900 New York, NY 10007 By: Jennifer Addonizio Rozen Esq. Defendant: Sidrane & Schwartz-Sidrane, LLP 119 N. Park Ave., Suite 201 Rockville Centre, NY 11570 By: Michael Littman, Esq.
Plaintiff:
Fishman Rozen, LLP
305 Broadway, Suite 900
New York, NY 10007
By: Jennifer Addonizio Rozen Esq.
Defendant:
Sidrane & Schwartz-Sidrane, LLP
119 N. Park Ave., Suite 201
Rockville Centre, NY 11570
By: Michael Littman, Esq.
Robert R. Reed, J.
This action involves the proper regulatory status and monthly rent of Apartment 5 (the Apartment) in a building located at 223 Avenue B, New York, New York, in which plaintiff Deganit Nuur resides. The building is owned by defendant 223 Avenue B, LLC (the Owner, or defendant).
Plaintiff moves, pursuant to CPLR 3212, for an order granting partial summary judgment: 1) determining that her apartment is subject to the Rent Stabilization Law; 2) freezing the rent at the legal regulated rent in effect the date of the last preceding registration statement; and 3) issuing an order requiring defendant to pay plaintiff's legal fees. In addition, plaintiff seeks an order, pursuant to CPLR 3025 (b), permitting her to file an amended complaint.
The complaint alleges that plaintiff commenced occupancy of the Apartment on or about June 1, 2012, pursuant to a one-year market-rate lease, effective June 1, 2012 through May 31, 2013, at a monthly rent of $ 2,150.00. Plaintiff's lease was renewed for the period from June 1, 2015 through May 31, 2017, at a monthly rent of $ 2,500.00.
The court notes that although, in the copy of the lease provided to the court, the lease form is legible, the information relating to this tenant is not legible.
This litigation was filed on August 22, 2016, and on or about February 17, 2017, defendant sent plaintiff a letter stating that her lease would not be renewed "because of business decision [sic]." See Rozen affirmation, exhibit E. On May 30, 2017, this court signed an order restraining defendant, pursuant to CPLR 6313, from commencing a summary eviction proceeding against plaintiff in the New York City Housing Court.
The complaint alleges that, according to the records of Division of Housing and Community Renewal (DHCR), until July 31, 2005, the Apartment was rented to Pedro Pagan (Pagan), as a rent stabilized apartment. The complaint further alleges that defendant never registered the Apartment as permanently exempt from rent stabilization, and that the failure to properly register the apartment is part of defendant's scheme to avoid the requirements of the Rent Stabilization Law.
PLAINTIFF'S REQUEST FOR A DECLARATORY JUDGMENT THAT HER APARTMENT IS SUBJECT TO RENT STABILIZATION
Plaintiff argues that the burden is on the Owner to establish that the apartment was properly removed from rent stabilization and contends that she conducted discovery and that, in response to her discovery demands, defendant has failed to produce documents which satisfy its burden.
Plaintiff submits two sets of DHCR Registration Apartment Information documents, one with a request date 12/11/2015, identifying the premises as Apt. 5 (Apt. 5 document), and another with a request date of 3/22/2016, identifying the premises as Apt. 05 (Apt. 05 document). See Rozen affirmation, exhibit C. The information contained in these documents is based on information filed with DHCR by the building owner. The Apt. 5 document lists Pagan as a rent stabilized tenant for the registration years of 1984 through 2004, with the final lease beginning on 8/01/2003 and ending on 7/31/2005, at a legal regulated rent of $ 325.56 per month. In contrast, the Apt. 05 document lists Pagan as the rent stabilized tenant for registration years 2002 through 2007, but indicates that registration information was not found for registration years 1984 through 2001 or for 2004. The Apt. 05 document lists the rent as $ 346.72 during the final lease term of 8/01/2005 through 7/31/2007. For the registration year 2008, the Apt. 05 document lists the apartment as permanently exempt as a high rent vacancy with the reason for change as VAC/LEASE (vacancy lease). Pursuant to section 2522.4 (a) (1) of the Rent Stabilization Code, a landlord can apply for a rent increase
According to defendant, the Apartment has been referred to in the records of DHCR as both Apartment 5 and Apartment 05.
The Apt. 5 document, indicates that registration information was not found for the premises for the registration years of 2002 or 2003 or for the registration years after 2004.
The Apt. 05 document indicates that registration information was not found for the premises for the registration year 2004.
Pursuant to section 2520.11 of the Rent Stabilization Code, an apartment lost the protections of rent stabilization when it "became vacant on or after April 1, 1997 but before June 24, 2011, where the legal regulated rent at the time the tenant vacated was $ 2,000 or more per month...." Rent Stabilization Code, 9 NYCRR 2520.11 (r) (4).
"where there has been a substantial increase, other than an increase for [a major capitol improvement] claimed pursuant to paragraph (2) of this subdivision, of dwelling space or an increase in the services, or installation of new equipment or improvements, or new furniture or furnishings, provided in or to the tenant's housing accommodation...."
9 NYCRR 2522.4 (a) (1). Plaintiff notes, however, that defendant failed to indicate on the rent history that it had performed any such individual apartment improvements (IAIs) as justification for the high rent vacancy.
Prior to September 24, 2011 monthly rent could be increased by 1/40th of the total cost of the IAIs. 9 NYCRR 2522.4 (a) (4).
In response to plaintiff's first demand for documents seeking evidence of expenditures for IAIs, defendant produced the affidavit of Angelo Koutsidis, who is currently a principal in Spire Interior Contracting Corp., but was previously a principal of Innovative Construction Associates. Koutsidis states that Innovative Construction Associates was hired "to complete extensive renovation work" in the Apartment, "commencing on or about January 2007 and completed on or about April 2007" and that "the subject apartment was vacant at the time we were hired." Rozen affirmation, exhibit G (Koutsidis aff, ¶ 3). In his affidavit Koutsidis lists the following items as performed and completed in Apt. 5:
"a. Demolition of apartment complete; b. Structural beam reinforcement; c. New Plumbing roughing and finishes; d. New Electrical roughing and finishes; e. New Sheetrock and carpentry to finish; f. New hardwood floors and porcelain tile; g. New Millwork, Kitchen Cabinets and Windows; h. Appliances."
Id., ¶ 5. Citing Matter of 985 Fifth Ave. v. State Div. of Hous. & Community Renewal , 171 AD2d 572 [1st 199] ), among other authority, plaintiff contends that, without additional documentation such as copies of invoices or cancelled checks, the Koutsidis affidavit is insufficient to establish that the renovation work was actually performed.
Plaintiff also argues that defendant failed to provide the first market rate tenant the appropriate notice as required by the Rent Stabilization Code. Pursuant to section 2520.11 (u) of the Rent Stabilization Code, the building owner is required to provide a notice to the first non-stabilized tenant containing the last regulated rent, the reason that the apartment is not subject to rent regulation and an explanation of how the new rent was calculated to enable it to reach the threshold amount for deregulation. 9 NYCRR 2520.11 (u). Plaintiff submits a copy of the market rate lease, produced by defendant pursuant to discovery, for tenants Jennifer Lowery (Lowery) and Daniel Lucier (Lucier), for the lease term of June 15, 2010 through June 30, 2011, which contains no such notice. That lease refers to a legal rent of $ 2,163 per month, with a "preferential rent" of $ 1,995 (Lowery/Lucier lease), containing no such notice. The Lowery/Lucier lease was extended from June 30, 2011 through June 30, 2012 at a monthly rent of $ 2,211.67, with a "preferential rent" of $ 2,039.89. According to plaintiff, the term "preferential rent" is only applicable to rent stabilized tenancies, and there is no need to differentiate between the legal rent and the "preferential rent" with market rate tenants. See Rent Stabilization Code, 9 NYCRR 2521.2 (a) ("Where the amount of rent charged to and paid by the tenant is less than the legal regulated rent for the housing accommodation such rent shall be known as the ‘preferential rent’ ").
Plaintiff asserts that no lease was produced by defendant in response to her demand for a lease for any tenant between Pagan and Lowery/Lucier, but notes that defendant asserts in its second affirmative defense that the Apartment became deregulated as a high rent vacancy of May 1, 2007, when Ashley Wood (Wood) moved in pursuant to a one-year lease commencing on May 1, 2007 and ending on April 30, 2008 at a rent of $ 2,200.00. See Rozen affirmation, exhibit J, ¶ 30. The only document concerning the Wood tenancy produced by defendant in discovery is a rent ledger created by defendant, covering the period from 8/01/07 through 4/01/08, listing the apartment at a rent as $ 2200 per month. See, Rozen affirmation, exhibit K. Plaintiff contends that the rent ledger is a self-serving document and that Wood was an illusory tenant. Therefore, plaintiff argues, the Lowery/Lucier lease should have contained the notice required by DHCR regarding the manner in which the non-regulated rent was set. See 9 NYCRR 2520.ll (u).
Plaintiff further contends that, assuming Wood was a real, rather than an illusory tenant, pursuant to the rent stabilization code, based on Pagan's final stabilized rent of $ 346.72, pursuant to the 2005-2007 lease, the permissible vacancy increases when the purported Wood tenancy began were as follows:
Longevity increase (24 years @ 6% /year or 14.4%) = $ 49.92
Vacancy increase for 1 year lease (15.75%) = $ 54.60
Subtotal =$ 104.52
Total new legal regulated rent =$ 451.24
A longevity increase is governed by Rent Stabilization Code section 2522.8 (2)(ii). 9 NYCRR 2522.8 (2) (ii).
Pursuant to Rent Stabilization Code section 2522.8 (a), "(1) if the vacancy lease is for a term of two years, 20 percent of the previous legal regulated rent; or (2) if the vacancy lease is for a term of one year, the increase shall be 20 percent of the previous legal regulated rent less an amount equal to the difference between: (i) the two year renewal lease guideline promulgated by the rent guidelines board applied to the previous legal regulated rent; and (ii) the one year renewal lease guideline promulgated by the rent guidelines board applied to the previous legal regulated rent." Rent Stabilization Code, 9 NYCRR 2522.8 (a).
Plaintiff argues that, only if defendant has reliable records concerning sufficient qualifying IAIs completed in the apartment prior to Wood's tenancy could the rent have reached the $ 2000 threshold necessary to trigger exit of the Apartment from rent stabilization protections and that defendant has failed to produce such reliable records.
Defendant contends that, as a result of a combination of the permitted rent increases after Pagan moved, including vacancy and longevity increases, as well as the increase based upon IAIs carried out by Koutsidis, the permitted rent exceeded the $ 2000 threshold in 2007, and, therefore, the Apartment became properly deregulated at that time. As the basis for the claim of IAIs performed in the Apartment, defendant relies on the affidavits of Koutsidis and Simon Elcabas, the Managing Agent for defendant, containing identical lists of renovation work allegedly performed and completed by Koutsidis at the cost of $ 62,000. Relying on DHCR policy statement 90-10 (June 26, 1990), which was in effect in 2007, when the renovation work was allegedly done, defendant argues that, even without additional documentation, the two affidavits provide sufficient support for the claimed IAIs. Policy statement 90-10 states:
"Any claimed MCI or individual apartment improvement cost must be supported by adequate documentation which should include at least one of the following:
1) cancelled check(s) contemporaneous with the completion of the work;
2) Invoice receipt marked paid in full contemporaneous with the completion of the work;
3) Signed contract agreement;
4) Contractor's affidavit indicating that the installation was completed in full."
Elcabas aff, exhibit D. See also Matter of Administrative Appeal of Pugachev , DHCR Administrative Review Docket No. EV610056RT (5/20/17) )(Improvements installed prior to the issuance of Operational Bulletin 2016-1 which requires the submission of all four forms of documentation, may be supported by a single form of documentation as indicated in DHCR's earlier Policy Statement 90-10).
Defendant argues that the Koutsidis affidavit and the affidavit of the managing agent, therefore, constitute sufficient support for its claim of an expenditure of $ 62,000 for IAIs to justify its assertion that the rent for the Apartment exceeded the $ 2000 threshold when Wood rented the Apartment for one year in May 2007.
Citing Matter of Grimm v. State of NY Div. of Hous. & Community Renewal Off. of Rent Admin. (15 NY3d 358 [2010] ), defendant contends that only where colorable fraud has been shown may the court look back at the rent history more than four years. Quoting the dissent in the Appellate Division decision in Boyd v. New York State Div. of Hous. and Community Renewal (110 AD3d 594, 597 [1st Dept 2013, rev 23 NY3d 999 [2014] ), which was adopted by the Court of Appeals in its 2014 decision, defendant contends that plaintiff must "present something more than a mere allegation of fraud" to justify an examination of the full rent history. Defendant contends that plaintiff has failed to show that the base date rent (of four years prior to the filing of the complaint) was the product of a fraudulent scheme to deregulate the apartment. Therefore, the court may not look back to 2007 beyond 2012.
Finally, defendant argues that a motion for summary judgment must be supported by an affidavit of someone with requisite knowledge of the facts. Defendant argues that, since plaintiff's motion is supported only by the affidavit of her attorney, her motion for partial summary judgment must be denied.
The standards on a motion for summary judgment are clear. It is well settled that the movant on a summary judgment motion "must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material issues of fact from the case." Winegrad v. New York Univ. Med. Ctr. , 64 NY2d 851, 853 (1985). The motion must be supported by evidence in admissible form (see Zuckerman v. City of New York , 49 NY2d 557, 562 [1980] ), and by the pleadings and other proof such as affidavits, depositions and written admissions. See CPLR 3212. The "facts must be viewed in the light most favorable to the non-moving party." Vega v. Restani Constr. Corp. , 18 NY3d 499, 503 (2012) (internal quotation marks and citation omitted). Once the movant meets its burden, it is incumbent upon the non-moving party to establish the existence of material issues of fact. Id ., citing Alvarez v. Prospect Hosp ., 68 NY2d 320, 324 (1986). The movant's "[f]ailure to make [a] prima facie showing [of entitlement to summary judgment] requires a denial of the motion, regardless of the sufficiency of the opposing papers ." Vega , 18 NY3d at 503 (internal quotation marks and citation omitted, emphasis in original).
Although plaintiff has not submitted her own affidavit in support of her motion, her complaint is verified, and her attorney's affidavit "even if [s]he has no personal knowledge of the facts, may, of course, serve as the vehicle for the submission of acceptable attachments which do provide ‘evidentiary proof in admissible form.’ " Zuckerman , 49 NY2d at 563. The question remains, however, as to whether the documents submitted by plaintiff are sufficient to support her motion for partial summary judgment.
It is clear that the court may look back more than four years to determine whether a colorable fraud has been committed by the building in setting the rent to remove the apartment from rent stabilization. "[T]he rental history may be examined for the limited purpose of determining whether a fraudulent scheme to destabilize the apartment tainted the reliability of the rent on the base date." Matter of Grimm , 15 NY3d at 367.
Defendant argues that the registration information contained in the Apt. 05 Document indicates that it properly registered the Apartment as high rent vacancy in 2008 when Pagan's lease ended. Here defendant relies on several documents to support the rent history. Relying on the DHCR Policy Statement 90-10 (June 26, 1990), which states that a contractor's affidavit constitutes adequate documentation to confirm costs for a major capital improvement (MCI) or an individual apartment improvement (IAI) application, defendant contends that the Koutsidis affidavit swearing that his company performed $ 62,000 worth of renovation work is sufficient to support defendant's claim of IAIs done on the Apartment at the end of Pagan's tenancy.
DHCR has indeed held that, under certain circumstances, it was not necessary to provide four forms of proof to support IAIs carried out prior to the issuance by the agency of a new policy statement in 2016. See Matter of Administrative Appeal of Pugachev, supra. In Pugachev , however, the owner provided copies of both paid invoices and cancelled checks to establish that improvements had in fact been carried out. Here, in contrast, defendant merely submits the affidavit of its contractor listing the categories of work done and a total amount of money that his company was allegedly paid. No additional documentation is submitted in support of his conclusory statement beyond an identical conclusory statement by the building's managing agent. Furthermore, the DHCR Policy Statement 90-10, on which defendant seeks to rely, itself states that "[w]henever it is found that a claimed cost warrants further inquiry, the processor may request that the owner provide additional documentation." Elcabas aff, exhibit D.
The court recognizes that many years have passed since 2007, when the work was allegedly performed, and that documents may well have been lost or destroyed in the intervening years. That passage of time, itself, however, raises the question of how Koutsidis is able to remember the specific work allegedly performed and its cost. Furthermore, the court notes that, applying the DHCR formula contained in section 2522.4 of the rent stabilization code ( 9 NYCRR 2522.4 (a) (4), the expenditure of $ 62,000 for qualified IAIs would increase the rent by $ 1550 per month, which when added to the permitted vacancy and longevity increases, would yield a rent of $ 2001.24, or $ 1.24 above the $ 2000 high rent vacancy threshold applicable in 2007.
Given the DHCR Policy Statement that was in effect at the time the work was allegedly performed, however, the court is not prepared to totally disregard Koutsidis's sworn statement, and to grant partial summary judgment because of the failure to produce additional documentation, as requested by plaintiff. As the court suggested during oral argument on this motion, the credibility of the contractor cannot be determined on the basis of an affidavit, but rather must be determined by the trier of fact. In fact, the court notes that in Bradbury v. 342 W 30th St. Corp. (84 AD3d 681 [1st Dept 2001] ), relied on by plaintiff for the principle that the rent for the Apartment must be rolled back to Pagan's 2007 rent, the court's decision that the rent must be rolled back to the last properly rent-stabilized rent resulted from a trial, in which the court, as finder of fact, concluded that the testimony of the landlord's principal was " ‘unbelievable in all material matters’ and ‘unworthy of belief,’ " Bradbury , 84 AD3d at 682.
Plaintiff is correct that, in some cases, the Appellate Division, First Department has required the submission of relevant bills, invoices or cancelled checks to justify claimed IAIs. See e.g. Matter of Yorkroad Assoc. v. New York State Div. of Hous. & Community Renewal , 19 AD3d 217 (1st Dept 2005) (affirming DHCR's denial of rent increases based upon alleged IAIs where no invoices or cancelled checks were provided by the landlord and the landlord failed to show a registration statement with DHCR for the apartment in the relevant year). In Matter of Yorkroad Assoc. , the Court further held that "DHCR correctly held that invoices for plastering, replacing window glass, refinishing a floor and painting had been correctly disallowed because they were not for improvements, but rather for repairs or normal maintenance." Matter of Yorkroad Assoc. , 19 AD3d at 218, citing Matter of Mayfair York Co. v. New York State Div. of Hous. & Community Renewal , 240 AD2d 158 [1997] ). In Jemrock Realty Co., LLC v. Krugman (13 NY3d 924, 926 [2010] ), where the case turned on the factual issue of whether the landlord's improvements were equal to the amount necessary to bring the rent over the luxury deregulation threshold, the Court of Appeals stated:
"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 factfinder in the same manner as other issues, based on the persuasive force of the evidence submitted by the parties."
Here, contrary to the allegations in the complaint, it appears that the apartment was, in fact, registered with the DHCR for the crucial year when it allegedly reached the high rent vacancy limit, although there are questions regarding the validity of that registration. The credibility of both affiants, the contractor and the managing agent, will be critical in determining the validity of the registration and whether the claimed IAIs can be supported without additional documentation.
Those determinations will also be crucial in connection with the threshold question of whether fraud was committed by defendant in claiming that the high rent threshold had been reached and removing the apartment from rent-stabilization, for, in the absence of fraud, the court may not look back beyond four years. Matter of Grimm , 15 NY3d at 367, citing Thornton v. Baron (5 NY3d 175 [2005] ). Here, where there are no allegations that the landlord had a fraudulent scheme to remove multiple apartments from rent regulation as there were in Thornton 5 NY3d at 177-178, the question of fraud will turn largely on the credibility of the landlord's witnesses which must be determined at trial. Thus, plaintiff's motion for partial summary judgment for a declaration that the Apartment is rent stabilized is denied.
PLAINTIFF'S REQUEST TO FREEZE THE RENT AT THE LAST LEGAL REGULATED RENT
Plaintiff further argues that, because defendant failed to file a proper and timely annual rent registration, her rent must be rolled back to "the legal regulated rent in effect on the date of the last preceding registration statement." Rent Stabilization Code § 517 (f). According to plaintiff that rent was $ 346.72, Pagan's registered rent for the registration year of 2007. See also Ernest & Maryanna Jeremias Family Partnership, LP v. Matas, 39 Misc 3d 1206(A), 2013 NY Slip Op 50505(U), *5 (Civ Ct, Kings County 2013), citing Thornton v. Baron , 5 NY3d 175 (additional citations omitted)("The rule that the rent amount reverts back to the last legal amount if, as here, a false amount was listed on DHCR registration has been established through many recent cases").
However, since partial summary judgment on plaintiff's motion for a declaratory judgment is denied, the court need not reach plaintiff's subsidiary request to have the rent rolled back to the last properly registered stabilized rent, or her request for attorney's fees.
PLAINTIFF'S REQUEST TO FILE AN AMENDED COMPLAINT
Plaintiff also seeks an order granting leave to file an amended complaint, pursuant to CPLR 3025 (b). The proposed amended complaint seeks to add a cause of action for breach of the warranty of habitability based upon conditions in the Apartment including,
"broken intercom system, inadequate heat, defective boiler, defective front door which is often left unsecured, vermin infestation throughout the apartment, inoperable oven and refrigerator, damaged and uneven wood floors throughout the apartment, chipped and peeling paint throughout the apartment in need of repair, broken and defective plastered surfaces throughout the apartment, broken and/or defective bathroom sink, recurring leaks in the ceiling, mold infestation throughout the apartment, exposure to debris and asbestos due to disruptive and dangerous construction above the apartment, disruptive noise cause {sic) by construction, defective wiring which cased (sic) internet outage for 2 months, defective mailbox, defective doorknob to apartment door, faulty plumbing in the bathroom."
Rozen affirmation, exhibit L, ¶ 29.
It is axiomatic that "[l]eave to amend the pleadings ‘shall be freely given’ absent prejudice or surprise resulting directly from the delay ( CPLR 3025, subd. [b] )." McCaskey, Davies & Assoc., Inc. v. New York City Health & Hosps. Corp. , 59 NY2d 755, 757 (1983) (additional citation omitted).
Defendant claims to be prejudiced by the lateness of the claim because discovery has been completed and the Note of Issue has been filed. Defendant's concern can be readily dealt with, however, by permitting additional time for discovery, particularly since no trial date has yet been set.
Nor can defendant claim surprise regarding at least some of plaintiff's warranty of habitability allegations. Defendant submits copies of two work orders relating to the Apartment as well as a document listing the status of several Department of Housing Preservation and Development (HPD) violations for the Apartment, arguing that many of plaintiff's claims have been cured. See Elcabas aff, exhibit H. With respect to plaintiff's complaints regarding vermin, defendant submits a Service History Report from First Rate Solutions, the building's exterminator regarding inability of the exterminator to gain access to the Apartment. Id., exhibit I. Defendant contends that the building is treated once per month and that, for the past 16 months, plaintiff has not permitted treatment of the Apartment.
The court notes, however, that only a very few of plaintiff's warranty of habitability allegations are even addressed by the HPD document, and the exterminator's notice primarily raises questions of fact regarding plaintiff's cooperation with addressing her complaints regarding vermin in the Apartment. Furthermore, as plaintiff contends, several of those documents would indicate awareness of at least some of her complaints —- thus, defendant cannot claim surprise.
Plaintiff filed her complaint on August 22, 2016 and filed her motion for leave to file an amended complaint approximately one and a half years after the filing of the defendant's answer. It is not clear why plaintiff waited for that amount of time to elapse before seeking to add a cause of action for warranty of habitability, since it appears that she was aware of at least some aspects of her proposed warranty of habitability complaints well before she made her motion. Although plaintiff has not provided the reason for her delay, as noted above, no trial date has yet been set. Moreover plaintiff argues that some of the conditions alleged in her proposed warranty of habitability cause of action bolster her claim that at least some of the claimed $ 62,000 worth of apartment renovations were never done.
Although plaintiff's brief in support of her motion contends that some of the complained of conditions have dramatically worsened since the filing of the complaint, plaintiff has not submitted an affidavit to that effect.
Since defendant's claimed prejudice can be mitigated by permitting additional discovery with respect to the new warranty of habitability claim (see Henry v. MTA, 106 AD3d 874, 874 [2d Dept 2013] ), and "as a practical matter, judicial economy is best served by one trial of all the claims," plaintiff's motion for leave to file an amended complaint will be granted. T.R. Am. Chems. v. Seaboard Sur. Co. , 97 AD2d 354, 354 (1st Dept 1983).
Finally, with respect to defendant's argument that this matter should be dismissed and referred to DHCR under the doctrine of primary jurisdiction, defendant acknowledges that the court has concurrent jurisdiction over rent overcharge cases. In addition, the underlying and central question in this case is whether the Apartment was improperly removed from rent stabilization and whether it should be returned to that program. That question is regularly dealt with by the court, rather than DHCR. Although many of the cases dealing with the improper removal of apartments from rent regulation involve the J-51 tax benefit program (see Roberts v. Tishman Speyer Props., L.P., 13 NY3d 270 [2009] and its progeny), a number of cases address other fraudulent actions to deregulate apartments. See e.g. Conason v. Megan Holding, LLC, 25 NY3d 1 (2015) ; Thornton v. Baron, 5 NY3d 175 ; Levinson v. 390 W. End Assoc., L.L.C. , 22 AD3d 397 (1st Dept 2005). An evaluation of defendants's actions will depend, at least in part, on the credibility of witness, which is routinely addressed in the context of a trial, and this court sees no need to refer the matter to the DHCR for such a determination. Moreover, dismissal of this action and referral of the matter to DHCR for a determination would merely further delay the resolution of the case. Therefore, defendant's request to dismiss the case and refer it to DHCR is denied.
Accordingly, it is hereby
ORDERED that plaintiff's motion for partial summary judgment is denied; and it is further
ORDERED that plaintiff's motion for leave to file an amended complaint in the form annexed to the motion is granted; and it is further
ORDERED that defendant will be permitted additional time for discovery to address the new allegations in the amended complaint; and it is further
ORDERED that counsel are directed to appear for a status conference in Room 412, 60 Centre Street, New York, New York on May 23, 2019, at 2:30 p.m.