Opinion
No. 570090/24
06-21-2024
St Nicholas 24 LLC, Petitioner-Landlord-Appellant, v. Carmen Chavez-Lujan, Respondent-Tenant-Respondent, and Luis Chavez, Respondent-Tenant.
Unpublished Opinion
Landlord appeals from 1) an order of the Civil Court of the City of New York, New York County (Jean T. Schneider, J.), dated July 13, 2020, which, after a nonjury trial on the rent overcharge counterclaim, found that the rent charged on the base date was affected by a fraudulent scheme to deregulate, and reopened the matter to permit the parties to present additional evidence relevant to the default formula; 2) an order (same court and Judge), dated March 1, 2021, which set a May 2012 base date, and awarded tenant overcharge damages in the principal amount of $195,973.69; and 3) a judgment (same court and Judge), entered May 10, 2022, upon stipulated facts, awarding tenant $57,600 legal fees.
PRESENT: Hagler, P.J., Tisch, James, JJ.
PER CURIAM.
Appeal from order (Jean T. Schneider, J.), dated March 1, 2021, deemed an appeal from the judgment (same court and Judge), entered on the same date, and so considered (see CPLR 5520[c]), judgment affirmed, with $25 costs. Judgment (same court and Judge), entered May 10, 2022, affirmed, without costs. Appeal from order (same court and Judge), dated July 13, 2020, dismissed, without costs, as subsumed in the appeal from the March 2021 judgment.
The trial court's finding that landlord engaged in a fraudulent scheme to deregulate the subject apartment was based on a fair interpretation of the evidence (see Claridge Gardens v Menotti, 160 A.D.2d 544, 544-545 [1990]). The trial evidence showed, and the court specifically found that "[landlord] and its predecessors deliberately hid the regulatory status of the apartment from their tenants by claiming that the apartment was deregulated when it was actually registered with the DHCR and omitted the required riders that would have demonstrated to a tenant that the apartment was still subject to regulations." Furthermore, "[landlord] offered no evidence at the trial that would have justified deregulation either in 2010, when the rent charged was $2,200, still below the deregulation threshold in effect at that time, or in 2011 when [tenant] signed her first lease" (see Matter of Grimm v State of NY Div. of Hous. & Community Renewal Off. of Rent Admin., 15 N.Y.3d 358, 366-367 [2010]; Butterworth v 281 St. Nicholas Partners, LLC, 160 A.D.3d 434 [2018]; Vendaval Realty, LLC v Felder, 67 Misc.3d 145 [A], 2020 NY Slip Op 50786[U] [App Term, 1st Dept 2020]). We note that landlord produced no witnesses at trial, including the agent subpoenaed by tenant.
Landlord's claim that tenant failed to prove all the elements of fraud was not raised below, and is thus unpreserved for appellate review (see CPLR 5501[a][3]; Hulsen v Morrison, 206 A.D.2d 459, 460 [1994]). In the circumstances, we need not consider the applicability of subsequent legislation clarifying that "there need not be a finding that all of the elements of common law fraud... were satisfied in order to make a determination that a fraudulent scheme to deregulate a unit was committed" (L 2024, ch 95, § 2-a; see L 2023, ch 760).
Because the court found that there was fraud, it properly applied the default formula in determining the legal rent (see Matter of Grimm v State of NY Div. of Hous. & Community Renewal Off. of Rent Admin., 15 N.Y.3d at 365-366; Davis v Graham Ct. Owners Corp., 211 A.D.3d 629, 630 [2022], lv denied 40 N.Y.3d 902 [2023]).
We sustain the judgment for attorneys' fees as landlord offered no substantial argument on appeal concerning that judgment, which was largely based upon stipulated facts.
We have considered landlord's remaining arguments and find them, to the extent preserved, unpersuasive.