Opinion
LT 57378/2005.
Decided August 31, 2006.
Respondent brings this motion for an Order awarding damages for wrongful eviction against the petitioner, and setting this matter down for a hearing to determine the amount of damages sustained by respondent. The moving papers indicate the damages consist of the difference between the fair market value and the rent indicated in the lease for the period between March 3, 2005 and May 16, 2005, as well as, attorney fees incurred by the respondent in the nonpayment proceeding and Supreme Court Actions. Petitioner opposes said motion by submitting an affirmation in opposition which indicates the respondent is not entitled to any damages. Petitioner claims that the application for damages should be restricted to solely attorney fees, and there is no entitlement because authorization does not exist pursuant to agreement between the parties, by statute or by court rule. Petitioner also asserts the claim for value of rent does not apply in this action because there is no ongoing operation to relocate or continue respondent's business, and furthermore, rent was not paid during the period asserted in the moving papers, specifically between March 3, 2005 and May 16, 2005.
BACKGROUND
This matter was commenced by petition verified on February 15, 2005, in which a non payment proceeding was commenced asserting tenant's failure to pay rent from December 1, 2004 to February 1, 2005, in the sum of $46,737.41. Prior to and during the pendency of the nonpayment proceeding, the respondent undertook to commence renovation work on the property without obtaining proper permits to do so, which resulted in the petitioner obtaining an injunction on January 31, 2005 signed by Honorable Judith Gishe.
On or about March 3, 2005, the petitioner's agents changed the locks to the premises and kept the keys, effectively evicting the respondent. Pursuant to a non-payment proceeding held in April of 2005, this Court issued a Decision and Order dated May 10, 2005, which found the respondent had been wrongfully evicted without petitioner having obtained a judgment of possession and a warrant of eviction from a Court of Law. The May 10, 2005 decision further awarded respondent treble damages pursuant to RPAPL § 853 and indicated that the issue of damages was to be determined in the related Supreme Court action which was still pending before Hon. Judith Gishe.
The respondent was provided with the keys to the premises on May 16, 2005. The petitioner then moved to vacate the May 10, 2005 Decision and Order, which resulted in a modification awarding the petitioner rental arrears for November 1, 2004 to March 3, 2005 in the sum of $46,737.41, but denying the balance of the motion, the decision was dated June 6, 2005. The petitioner appealed both the May 10, 2005 Decision and Order as well as the June 6, 2005 Decision and Order. On May 3, 2006, the Appellate Term, First Department supported the finding of wrongful eviction but determined the award of treble damages was unwarranted because of the petitioner's concerns over respondent's unauthorized construction on the demised premises.
In the interim, Hon. Judith Gishe issued an Order dated March 23, 2006, returning this case to the Civil Court on the issue of damages resulting from the liability adjudication made in the Civil Court. However, an application for an Injunction is still pending in Supreme Court, pursuant to the same Order of Hon. Judith Gishe, dated March 23, 2006.
LEGAL ANALYSIS
The respondent seeks to recover damages for the loss of value to the leasehold for the period of time the wrongful eviction occurred, March 3, 2005 and May 16, 2005. The amount of which is the difference between the actual rental value and the agreed upon but unpaid amount. The base rent at the time of the illegal lockout was $12,667.00 per month. The petitioner argues the respondent is only entitled to discharge from liability for rent. This Court disagrees with petitioner's position, and finds that under certain circumstances the tenant is entitled to damages in addition to the discharge from liability for rent, see New York Rhys. Co v. Muldoon, 181 NYS2d 378 [App. Term, 1920] . The respondent cites three cases to support it's position, the first is, Randall-Smith Inc. v. 43rd St. Estates Corp. et al., 17 NY2d 99, 215 NE2d 494, 268 NYS2d 306, however there are distinctions that would render application inappropriate in this case. In Randall-Smith Inc. v. 43rd St. Estates Corp. et al., 17 NY2d 99, the tenant was evicted from the premises and part of the space involved was rented to another tenant, in this case, the space was returned to the respondent as of May 16, 2005 and they remain in possession, only the period between March 3, 2005 and May 16, 2005, was at issue before this Court. Furthermore, treble damages were deemed appropriately awarded in the other case because there was no justification for the eviction, in this case the New York Supreme Court, Appellate Term, First Department, has determined that treble damages were unwarranted because the petitioner acted out of concern over respondent's unauthorized construction of the demised premises, thus providing justification. See, West Broadway Glass Company v. Namaskaar of Soho, Inc., 11 Misc 3d 144 (A), 2006 WL 1173644 . In the second cited case, Sam Mary Housing Corp. v. Jo/Sal Market Corp., 100 AD2d 901, 474 NYS2d 786 (2nd Dept.), the court determined that where the conduct was not so heinous or reprehensible as to require treble damages, the difference in rent was provided, however, the defendants were to remain dispossessed for the duration of the lease, in this case respondent was restored to possession. Finally, in the third cited case, In the Matter of Marina Bay Club, Inc. v. Louis S.Cannizzaro, 105 AD2d 1114, 482 NYS2d 389, the Court indicated that the issue was not wrongful eviction but rather refusal to consent to the assignment of the lease.
In a more applicable case, Fisher v. Queens Park Realty Corp., 41 AD2d 547, 339 NYS2d 642, [2nd Dept., 1973], the Court found that when there is a disturbance or interference with possession, the tenant is entitled to recover damages that are a natural consequence of the landlord's trespass or wrongful act, see also Statement Inc. v. Pilgrim's Landing Inc., 49 AD2d 28, 370 NYS2d 642 [NYAD, 1975]. The issue in this case, is whether respondent suffered damages that are a natural consequence of the wrongful eviction. Respondent suffered no loss of business or income at the time of the wrongful eviction in this case, they were already closed at the time of the eviction and seeking to renovate the premises. Furthermore, there was a prior injunction against the respondent for failure to obtain proper building permits prior to the commencement of the renovation, therefore consequential damages do not apply, and damages as to rental value are not applicable because the respondent was restored to possession on May 16, 2005, and continues in possession.
The respondent has indicated that it is entitled to attorney's fees. Court's have held that a party's entitlement to attorney's fees should be narrowly construed inasmuch as New York has traditionally followed the common-law rule disfavoring any award of attorneys fees to the prevailing party in a litigation. See Gottlieb v. Kenneth D. Laub Co. Inc., 82 NY2d 457, 605 NYS2d 213, 626 NE2d 29(NY Ct. App., 1993) and Murphy v. Vivian Realty Company, 199 ad2d 192, 605 NYS2d 285 (N.Y.A.D. 1st Dept., 1993). However, in instances in where attorneys fees are awarded, a determination must be made as to whether a party has prevailed. The Courts have provided factors for making a determination, which include, initial consideration of the true scope of the dispute litigated, followed by comparison of the amount actually sought, as determined by the pleadings, offers of proof, or other means, with the actual recovery. See Solow v. Wellner, 205 AD2d 339, 613 NYS2d 163 (N.Y.A.D. 1st Dept., 1994) and Excelsior 57th Corp. v. Winters, 227 AD2d 146, 641 NYS2d 675 (N.Y.A.D. 1st Dept., 1996). In addition, it has been held that a prevailing party may not collect attorney fees from the loser unless the award is authorized by agreement between the parties, statute or court rule. See, Matter of A.G. Ship Maintenance Corp., v. Lezak, 69 NY2d 1, 5; Mighty Midgets v. Centennial Ins. Co., 47 NY2d 12 at 21-22; City of Buffalo v. Clement Co, 28 NY2d 241 at 262-263 and Hooper Associates v. AGS Computers, Inc., 74 NY2d 487, 548 NE2d 903, 549 NYS2d 365. In this case, although the respondent has established wrongful eviction, it has not been established that it is entitled as a prevailing party, to legal fees. The respondent has not demonstrated pursuant to the lease agreement, statutory provision or court rule it would be entitled to legal fees. There is no reference in the moving papers to specific provisions or paragraphs in the lease agreement itself, that would allow the respondent to obtain attorneys fees. The statutory provision involved, RPAPL § 853, only awards treble damages not attorney fees. The Supreme Court Appellate Division found the award of treble damages were not warranted in this case, because petitioner's actions were partially justified, based on that Court's reasoning, attorneys fees should also not be awarded in this case. Pursuant to case law, sufficient proof was not provided in the moving papers that the behavior of the petitioner was of such a degree of bad faith, punitive damages in the form of attorney's fees should be awarded because there was an intentional and dishonest attempt to fail to carry out the terms of the lease. See Aero Garage Corp. V. Abraham Hirschfeld, 185 AD2d 775, at 777, 586 NYS2d 611 citing to Williamson, Picket, Gross v. Hirschfeld, 92 AD2d 289 at 295, quoting Gordon v. Nationwide Mut. Ins. Co., 30 NY2d 427 at 437. On the contrary, the Supreme Court Appellate Term found, the petitioner acted out of concern over respondent's unauthorized construction of the demised premises, thus providing justification for its actions.
CONCLUSION
Respondent has demonstrated wrongful eviction for the period between March 3, 2005 and May 16, 2005, but has not provided sufficient evidence that it resulted in an entitlement to damages as a result of petitioner's actions. As to claims regarding damages for attorney's fees regarding the Supreme Court Actions that is outside of this Court's jurisdiction, therefore the respondent is granted leave to make that application before the appropriate Court. As such, there is no evidence before this court that the motion should be granted. Accordingly, the motion is denied in its entirety.
The foregoing shall constitute the Decision and Order of the Court.