Opinion
DOCKET NO. A-5509-13T3
02-09-2016
13-19 WNY, LLC, Plaintiff-Respondent, v. MIKE KHALIL, Defendant-Appellant.
Cutolo Mandel, LLC, attorneys for appellant (Jeffrey S. Mandel, of counsel and on the briefs). Roberta L. Tarkan, attorney for respondent.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Fisher and Rothstadt. On appeal from Superior Court of New Jersey, Law Division, Special Civil Part, Hudson County, Docket No. L-7234-14. Cutolo Mandel, LLC, attorneys for appellant (Jeffrey S. Mandel, of counsel and on the briefs). Roberta L. Tarkan, attorney for respondent. PER CURIAM
In this residential tenancy summary dispossess action, the tenant, defendant Mike Khalil, appeals from the entry of a judgment for possession in favor of his landlord, plaintiff 13-19 WNY, LLC. On appeal, defendant argues the judgment should be reversed or vacated and the matter remanded because the trial court failed to consider whether the unpaid rent claimed by plaintiff violated the local rent control ordinance then in effect and whether plaintiff complied with the statutory requirements governing a landlord's registration. Plaintiff responds by averring the court properly did not consider the rent's legality, and it proved it had registered in accordance with the law. Further, plaintiff contends the matter is moot because defendant paid the amount forming the basis for the judgment and remained in possession of the premises.
We have considered the parties' arguments in light of our review of the record and applicable legal principles. We vacate the entry of judgment and remand for a new trial.
The following salient facts are derived from the events that occurred at trial. The parties did not dispute that they had entered into a landlord-tenant relationship or that the monthly rent claimed by plaintiff was $950. Although plaintiff testified that defendant originally entered into a written lease that converted to a month-to-month tenancy after expiring, no evidence of a written lease was presented. Further, there was no testimony establishing the monthly rent owed at the lease's inception. The total rent plaintiff claimed to be due was $3,800.
Because of the limited record developed at trial, we cannot discern why the original lease was not renewed according to its original terms and whether the non-renewal violated N.J.S.A. 2A:18-61.3's prohibition against non-renewal except for cause.
Defendant testified he stopped paying rent because he overpaid in prior months due to plaintiff charging an amount in excess of the amount permitted by the local rent control ordinance. In response, the court inquired whether defendant obtained "an opinion from the rent control board." Defendant explained he did not because plaintiff never registered with the board. Plaintiff produced a rent control registration that he signed in 2009. Defendant explained the 2009 document, which did not include defendant as a tenant of his unit, failed to satisfy the ordinance's requirement for annual registration. The court determined the rent control ordinance was inapplicable, yet did not state any reasons for its conclusion, other than defendant not having presented "any original ordinance but [only] an amendment which talks about rental agreements and applications filed."
Defendant also objected at trial to the entry of a judgment because plaintiff's verified complaint failed to allege plaintiff had registered in accordance with N.J.S.A. 48:8-28. When defendant raised the issue, plaintiff's counsel showed the judge what she purported to be a State of New Jersey Department of Community Affairs registration. However, the alleged registration was displayed only on counsel's laptop computer and shown to the judge, while it was not shown to defendant. The court found there was a "certificate of inspection" and a "registration number," and concluded "the property [was] registered."
The court entered a judgment for possession. Defendant paid the judgment amount pursuant to N.J.S.A. 2A:18-55, and remained in possession.
This appeal followed.
At the outset, we address plaintiff's contention that the matter is moot. An issue has become moot "when the decision sought in a matter, when rendered, can have no practical effect on the existing controversy." Comando v. Nugiel, 436 N.J. Super. 203, 219 (App. Div. 2014) (quoting Greenfield v. N.J. Dep't of Corrs., 382 N.J. Super. 254, 257-58 (App. Div. 2006)); see also Betancourt v. Trinitas Hosp., 415 N.J. Super. 301, 311 (App. Div. 2010) (declining to address the merits of a dispute regarding the authorization of medical treatment because the issue was moot). The doctrine of mootness will bar review "if the issues are hypothetical, a judgment cannot grant effective relief, or there is no concrete adversity of interest between the parties." Matthew G. Carter Apartments v. Richardson, 417 N.J. Super. 60, 67 (App. Div. 2010) (quoting Advance Elec. Co., Inc. v. Montgomery Twp. Bd. of Educ., 351 N.J. Super. 160, 166 (App. Div.), certif. denied, 174 N.J. 364 (2002)).
We disagree with plaintiff, primarily because this is not a case in which our decision can have no practical effect, such as when a tenant vacates the premises and the landlord re-lets them to a third party. See, e.g., Daoud v. Mohammad, 402 N.J. Super. 57, 61 (App. Div. 2008) ("Because the court's jurisdiction is limited to determining the issue of the landlord's right to possession of the premises, and, as previously noted, the tenant vacated the premises and the premises have been re-rented, the issue can no longer be determined."); Sudersan v. Royal, 386 N.J. Super. 246, 251 (App. Div. 2005) ("Ordinarily, where a tenant no longer resides in the property, an appeal challenging the propriety of an eviction is moot.").
In this case, defendant remained in possession because he paid the judgment amount that he contested at trial. N.J.S.A. 2A:18-55; see also Hodges v. Sasil Corp., 189 N.J. 210, 221 (2007) ("If the rent owed is paid 'on or before entry of judgment,' the legal proceeding is terminated." (quoting N.J.S.A. 22A:18-55)). By paying "the amount fixed by the court in a timely fashion, the tenant is restored to possession and the landlord . . . gain[s] the benefit of receiving payment of the rent that was due." Green v. Morgan Props., 215 N.J. 431, 450 (2013). The tenant's payment, however, without vacating the premises and their being re-let to a third party does not render an appeal moot, as the parties can be restored to the status quo ante should the tenant succeed — i.e., defendant remains in possession and is repaid for any overpayment through either a lump sum or future rent abatements.
Having concluded that defendant's appeal is ripe for determination, we begin our review recognizing its limited scope as it follows a judge's decision after a bench trial. Sebring Assocs. v. Coyle, 347 N.J. Super. 414, 424 (App. Div.), certif. denied, 172 N.J. 355 (2002); Liqui-Box Corp. v. Estate of Elkman, 238 N.J. Super. 588, 596 (App. Div.), certif. denied, 122 N.J. 142 (1990). In such cases, we "must review the record. . . . but not initially from the point of view of how [we] would decide the matter if [our court was] the court of first instance." State v. Johnson, 42 N.J. 146, 161 (1964). A trial court's findings of fact will "not be disturbed unless they are so wholly insupportable as to result in a denial of justice." Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 483-84 (1974) (internal quotation marks omitted). However, we do not accept factual findings, even those regarding credibility, which are "so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence." Id. at 484. Also, we owe no special deference to the judge's legal conclusions. Manalapan Realty v. Manalapan Twp. Comm., 140 N.J. 366, 378 (1995). "When deciding a purely legal issue, review is de novo." Kaye v. Rosefielde, 223 N.J. 218, 229 (2015) (quoting Fair Share Hous. Ctr., Inc. v. N.J. State League of Municipalities, 207 N.J. 489, 493-94 n.1 (2011)).
Applying these standards here, we conclude the court's determination that the local rent control ordinance was inapplicable, and reliance on plaintiff's counsel's undisclosed computer display to prove registration, were erroneous and warrant vacating the judgment.
First, contrary to the judge's legal conclusion, a rent control ordinance applies to a landlord's action for possession based on unpaid rent. "Fixing the rent . . . that is due is a crucial step in the process of entering a judgment of possession." Green, supra, 215 N.J. at 450. While a landlord is authorized to seek a judgment of possession based on unpaid rent, N.J.S.A. 2A:18-61.1(a), the alleged unpaid rent cannot amount to a violation of local rent control ordinances. See N.J.S.A. 2A:18-61.1(f) (establishing "good cause" exists to evict a tenant when he or she "has failed to pay rent after a valid notice to quit and notice of increase of said rent, provided the increase in rent is not unconscionable and complies with any and all other laws or municipal ordinances governing rent increases") (emphasis added); see also 316 49 St. Assocs. Ltd. P'ship v. Galvez, 269 N.J. Super. 481, 488 (App. Div.) ("It is well settled that a landlord may not charge rent in excess of that fixed by the applicable rent control ordinance."), certif. denied, 137 N.J. 164 (1994); Chau v. Cardillo, 250 N.J. Super. 378, 384 (App. Div. 1990) ("It is apparent from [N.J.S.A. 2A:18-61.1(f)] that a landlord may not remove a tenant from premises for failure to pay an increase in the rent unless the rental increase complies with the applicable municipal rent leveling ordinance."). For that reason, the Rules require courts, at the beginning and end of the calendar call, to inform tenants who are present for trial that "the amount due as rent may be limited by a rent control ordinance." Cmty. Realty Mgmt. v. Harris, 155 N.J. 212, 242 (1998); see also R. 6:5-2(b); Landlord/Tenant Pre-Calendar Call Instructions, Pressler & Verniero, Current N.J. Court Rules, Appendix XI-S to R. 6:5-2(b) at www.gannlaw.com (2016).
Similarly, a landlord must establish not only that the rent is lawfully due, but also that the tenancy is properly registered pursuant to N.J.S.A. 46:8-28. Specifically, landlords are required to register with municipalities, unless the tenancy involves a "multiple dwelling," which is defined as "any building or structure of one or more stories . . . in which three or more units of dwelling space are occupied, or are intended to be occupied by three or more persons who live independently of each other." N.J.S.A. 55:13A-3.
The statute provides in pertinent part:
Every landlord shall . . . file with the clerk of the municipality . . . in which the residential property is situated, in the case of a one-dwelling unit rental or a two-dwelling unit non-owner occupied premises, or with the Bureau of Housing Inspection in the Department of Community Affairs in the case of a multiple dwelling as defined in section 3 of the "Hotel and Multiple Dwelling Law" [N.J.S.A. 55:13A-3], a certificate of registration on forms prescribed by the Commissioner of Community Affairs . . . .
[N. J.S.A. 46:8-28.]
"Under the provisions of N.J.S.A. 46:8-33 no judgment for possession may be entered unless the landlord has complied with the registration requirement." Iuso v. Capehart, 140 N.J. Super. 209, 212 (App. Div. 1976). Accordingly, our Rules require that a landlord's complaint include a verified statement that the landlord "has registered the leasehold and notified [the] tenant as required by N.J.S.A. 46:8-27." Verified Complaint - Nonpayment of Rent, Pressler & Verniero, supra, Appendix XI-X to R. 6:3-4(c) at www.gannlaw.com; see R. 6:3-4(c) (requiring tenancy actions to conform substantially to the model verified complaint contained in Appendix XI-X). A landlord's noncompliance with this requirement precludes the entry, of a judgment of possession, even if warranted, but the court is allowed to "continue[] the matter for a period of up to 90 days to permit the landlord to register the premises." Iuso, supra, 140 N.J. Super. at 212; see N.J.S.A. 46:8-33.
Plaintiff's complaint failed to comport with the foregoing requirements, as it did not include a verified statement as to registration. Also, at trial, the record is devoid of any competent proof demonstrating that plaintiff complied with the registration requirements. The only evidence offered as to the landlord's registration was information purportedly displayed to the court on plaintiff's counsel's laptop computer. There was no testimony as to either the nature of the property's structure or the information provided in the registration to prove that plaintiff adhered to the requirements. In that regard, the most egregious transgression was the court's failure to insure that whatever information it considered was shared with defendant, properly identified and admitted into evidence for the purpose of creating a complete record. Accordingly, the state of the record before us precludes our determination as to whether the information relied upon by the court satisfied the registration requirements.
The judgment of possession is vacated and the matter is remanded to the trial court for a new trial. We do not retain jurisdiction. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION