Opinion
25537/2009.
Decided June 29, 2011.
Rothkrug Rothkrug Spector, LLP, by Simon H. Rothkrug, Esq., for the Plaintiff.
Rosen Livingston Cholst, LLP, by Andrew J. Wagner, Esq., for the Defendant Gerard Owners Corp.
Corporation Counsel, by Warren Shaw, Esq., FOR the Defendant New York City Entities.
Baron Baron, by Kristen A. Meilak, Esq., for the Defendant Adam Plotch.
The following papers numbered 1 to 4 read on this motion by defendant Gerard Owners Corp. (Gerard) for an order permitting it to reargue, inter alia, those branches of its prior motion submitted on July 29, 2010 which sought the dismissal of the third, fourth, fifth, and sixth affirmative defenses asserted by plaintiff Faramarz Roshodesh against Gerard's counterclaims
Papers Numbered
..................................................... Order to Show Cause — Affidavits — Exhibits....................1 Answering Affidavits — Exhibits................................2-3 Reply Affidavits...............................................4The facts pertaining to the action brought by plaintiff Roshodesh against defendant Gerard, as found by the Court in its decision and order, of even date, rendered on the companion motion by Gerard for summary judgment dismissing the complaint against it, are as follows:
In early 2006, defendant Gerard began three separate summary nonpayment proceedings against plaintiff Roshodesh in the New York City Civil Court, County of Queens which involved Apartments 3U, 3V, and 7Y respectively: (1) Gerard Owners Corp. v. Roshodesh, Index No. 53224/06 (the 3U proceeding), (2) Gerard Owners Corp. v. Roshodesh, Index No. 54568/06 (the 3V proceeding), and (3) Gerard Owners Corp. v. Roshodesh, Index No. 51429 (the 7Y proceeding). The parties never consolidated these three separate nonpayment proceedings.
In November, 2006, the judge in these summary proceedings appointed a guardian ad litem (Thomas Giles) to look after Roshodesh's interests. The parties eventually conducted a joint trial of the three proceedings before Judge Tao on March 3, 2008, and Giles defended the proceedings on the behalf of Roshodesh, who did not himself appear. After the trial, Judge Tao awarded Gerard a judgment of $35,756.37 in the 3V proceeding, a judgment of $18,090.17 in the 3U proceeding, and a judgment of $13,393.12 in the 7Y proceeding.
Upon being served with notice of entry of the judgments and orders, Roshodesh attempted to obtain stays, and he obtained a temporary stay in the 3V proceeding conditioned upon the deposit of $35,756.37 with the New York City Department of Finance. Roshodesh deposited this sum, but he did not deposit the sum of $13,393.12 necessary to obtain a stay of the separate 7Y proceeding.
By decision and order dated September 26, 2008, the Appellate Term for the Second and Eleventh Judicial Districts, inter alia, denied Roshodesh a stay pending the hearing and determination of his appeal from the 7Y judgment, but granted Roshodesh a stay pending the hearing and determination of appeals pertaining to 3U and 3V post-trial motions. The Department of Finance erroneously released the sum deposited in the 3V proceeding to the attorneys for Gerard, and they kept the sum in their escrow account.
Gerard entered the judgment for $13,353.12 rendered in the 7Y proceeding with the Clerk of Civil Court on March 14, 2008, and because Roshodesh failed to satisfy the judgment or deposit the amount of the judgment with the Department of Finance, on July 8, 2008, Gerard issued an execution notice with notice to garnishee (Gerard), directing the Sheriff to levy upon the shares of stock pertaining to Apartment 7Y. Roshodesh subsequently served the Sheriff with an order to show cause dated July 22, 2008.
After the Appellate Term denied Roshodesh's motion for a stay pending appeal of the 7Y judgment, Gerard issued a second execution notice to the Sheriff, directing him to levy on the shares of stock pertaining to Apartment 7Y. The Sheriff did so, and he sold the stock at a public auction held on or about November 19, 2008. Defendant Adam Plotch successfully bid $96,000 for the apartment.
The plaintiff began this action on or about September 22, 2009. The first cause of action is for a judgment declaring that the Sheriff's sale of the shares allocated to Apartment 7Y was void and that the plaintiff lawfully owns the shares. The second cause of action is against the Sheriff for negligence. The third cause of action is for an accounting of the rents paid by the tenant in Apartment 7Y to defendant Plotch. The fourth cause of action is for a "restraining order" prohibiting, inter alia, the sale of Apartment 7Y. Gerard successfully moved for summary judgment dismissing the complaint against it and all of the cross claims against it. (See the decision rendered on the companion motion).
Defendant Gerard answered the complaint and asserted three counterclaims. The first counterclaim alleges that Gerard is the owner and proprietary lessor of the building located at 70-25 Yellowstone Boulevard, Forest Hills, Queens County, New York, and that the plaintiff is a shareholder and the proprietary lessee of Apartment 3U. The defendant owner alleges that the plaintiff defaulted on his obligation under the lease to make monthly maintenance payments in the amount of $746.05 for Apartment 3U. The second counterclaim alleges that the plaintiff, the proprietary lessee of Apartment 3V, defaulted on his obligation under the lease to make monthly maintenance payments in the amount of $1,629.78.
On July 29, 2010, Gerard submitted a motion for, inter alia, an order dismissing the plaintiff's first, second, third, fourth, fifth, and sixth affirmative defenses asserted against its counterclaims. This Court disposed of the motion by decision and order dated November 10, 2010, by, inter alia, denying the motion as to the third, fourth, fifth, and sixth affirmative defenses ( Roshodesh v Plotch, 29 Misc 3d 1220(A), 2010 WL 4540452, 2010 NY Slip Op 51912[U] [decision by the undersigned]). Gerard has now moved for leave to reargue.
Upon the foregoing papers, leave to reargue is granted. A motion to reargue may be brought where "the court overlooked or misapprehended the facts or the law or for some reason mistakenly arrived at its earlier decision." ( Schneider v. Solowey, 141 AD2d 813 [2nd Dept. 1988]; see, CPLR 2221[d]; Grassel v. Albany Med. Ctr. Hosp., 223 AD2d 803 [3rd Dept.], lv. to appeal dismissed in part and denied in part, 88 NY2d 842; William P. Pahl Equipment Corp. v. Kassis, 182 AD2d 22 [1st Dept.], lv. to appeal dismissed in part and denied in part, 80 NY2d 1005).
Upon reargument, that branch of Gerard's prior motion which was for an order dismissing the third affirmative defense is granted. The third affirmative defense is based on the allegation that Gerard failed to file records properly with the New York State Department of Housing and Community Renewal with respect to Major Capital Improvements, thereby causing the plaintiff's apartments to generate insufficient rent. A party moving pursuant to CPLR 3211(b) for an order dismissing an affirmative defense has the burden of demonstrating that the defense is without merit as a matter of law ( see, Vita v New York Waste Svcs., LLC , 34 AD3d 559 [2nd Dept. 2006]; Santilli v Allstate Ins. Co. , 19 AD3d 1031 [4th Dept. 2005]). On the prior motion, the Court found that Gerard had not adequately established that the cooperative falls outside the scope of the Rent Stabilization Law ( see, NYC Code § 26-504[a]) and that the plaintiff, rather than the cooperative, had to file the MCI records.
Gerard now makes clear that it relies on the Rent Stabilization Regulations of the Division of Housing and Community Renewal themselves in support of its contention that the plaintiff had the responsibility of filing for the MCI increases. One important provision, 9 NYCRR section 2520.6, entitled "Definitions," states, in relevant part: "(i) Owner. A fee owner, lessor, sublessor, assignee, net lessee, or a proprietary lessee of a housing accommodation in a structure or premises owned by a cooperative corporation or association,. . . . or any other person or entity receiving or entitled to receive rent for the use or occupation of any housing accommodation. . . . ." (Emphasis added).
Another pertinent provision, 9 NYCRR section 2522.4, "Adjustment of legal regulated rent," states, in relevant part: "(a) Increased space and services, new equipment, new furniture or furnishings; major capital improvements; other adjustments. . . . (2) An owner may file an application to increase the legal regulated rents of the building or building complex on forms prescribed by the DHCR, on one or more of the following grounds: (i) There has been a major capital improvement. . . ." Gerard has now successfully demonstrated that plaintiff Roshodesh himself could have filed for the MCI increases. The Court notes, moreover, that the responsibility for filing for an MCI increase is irrelevant as to Apartment 3V, where the plaintiff actually resides.
Upon reargument, that branch of Gerard's prior motion which was for an order dismissing the fourth affirmative defense is granted. The plaintiff asserts that a failure by the defendant owner to make MCI filings totally bars the collection of rent from him. However, the plaintiff himself could have filed for the MCI increases ( see, 9 NYCRR § 2520.6; 9 NYCRR § 2522.4).
Upon reargument, that branch of Gerard's prior motion which was for an order dismissing the fifth affirmative defense is granted. The plaintiff alleges that "[d]efendant Gerard Owner's Corp. [ s] counterclaims are barred by the doctrine of unclean hands." The doctrine of unclean hands is an equitable defense which cannot be asserted against a cause of action which is exclusively for damages ( Greco v. Christoffersen 70 AD3d 769 [2nd Dept. 2010]; Manshion Joho Ctr. Co., Ltd. v. Manshion Joho Ctr., Inc. , 24 AD3d 189 [1st Dept. 2005]).
Upon reargument, that branch of Gerard's prior motion which was for an order dismissing the sixth affirmative defense is granted. The Court notes, in regard to collateral estoppel, res judicata, etc., that Gerard is only seeking to recover here for new arrears that accrued after the Civil Court proceedings ended, thus raising different issues in this forum. The doctrine of collateral estoppel "applies if the issue in the second action is identical to an issue which was raised, necessarily decided and material in the first action, and the plaintiff had a full and fair opportunity to litigate the issue in the earlier action." ( Parker v Blauvelt Volunteer Fire Co., Inc., 93 NY2d 343, 349; Sam v Metro-North Commuter Railroad, 287 AD2d 378 [1st Dept. 2001]).
Upon reargument, that branch of Gerard's prior motion which was for summary judgment on its first counterclaim is granted as to the issue of liability. The issue of damages shall be tried at the time of the trial of the remainder of the counterclaims. "[T]he proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact" ( Alvarez v. Prospect Hospital, 68 NY2d 320, 324).
Defendant Gerard successfully carried this burden by submitting the affidavit of Tony Pellosie, the managing agent for Gerard, stating that plaintiff Roshodesh owes $28,334.92 in maintenance and other arrears for Apartment 3U as of February 8, 2011. The opponent of a motion for summary judgment has the burden of producing evidence showing that there is an issue of fact which must be tried ( see, Alvarez v. Prospect Hospital, 68 NY2d 320, supra) or of demonstrating the existence of a defense warranting the denial of summary judgment ( see, Plantamura v. Penske Truck Leasing, Inc., 246 AD2d 347 [1st Dept. 1998]). Plaintiff Roshodesh failed to carry this burden. He did not submit evidence showing that he is not in arrears, and all of his affirmative defenses pertaining to Apartment 3U have been dismissed.
Upon reargument, that branch of Gerard's prior motion which was for an order pursuant to RPL section 220, directing the plaintiff to pay use and occupancy for Apartments 3U and 3V pendente lite is granted to the extent that plaintiff Roshodesh shall continue to pay use and occupancy at the rate provided in the lease on each rental due date until resolution of the underlying counterclaims.
This Court previously denied what it construed to be an application for a preliminary injunction directing the plaintiff to pay use and occupancy. Gerard now makes clear that its application is based on RPL section 220, creating a cause of action for use and occupation and providing a basis for an order requiring a tenant to pay use and occupancy pendente lite. ( see, Andejo Corp. v. South Street Seaport Ltd. Partnership , 35 AD3d 174 [1st Dept. 2006]; Englert v. Mahoney, 258 AD2d 859 [3rd Dept.], lv. to appeal dismissed, 93 NY2d 999; Trump CPS LLP v. Meyer, 249 AD2d 22 [1st Dept. 1998]).
The foregoing constitutes the Court's decision, order, and opinion.