Opinion
38932/2016
07-18-2017
1775 Clay Realty LLC, Petitioner-Landlord, v. Delilah Fleming and Rachel Fleming, Respondents-Tenants.
Attorney for Petitioner: David Moss & Associates 370 Lexington Avenue, Suite 2102 New York, New York 10017 (212) 566-6780 Attorney for Respondent: Adriana Alvarez, Esq. Legal Services NYC — Bronx 349 E. 149th Street, 10th floor Bronx, New York 10451 (718) 928-2877
Attorney for Petitioner: David Moss & Associates 370 Lexington Avenue, Suite 2102 New York, New York 10017 (212) 566-6780 Attorney for Respondent: Adriana Alvarez, Esq. Legal Services NYC — Bronx 349 E. 149th Street, 10th floor Bronx, New York 10451 (718) 928-2877 Diane E. Lutwak, J.
Recitation, as required by CPLR 2219(A), of the papers considered in the review of Respondent's Motion for Leave to Interpose an Amended Answer and for Dismissal and/or Partial Summary Judgment: Papers Numbered Respondent's Notice of Motion with Affirmation & Exhibits A-L 1 Petitioner's Affirmation in Opposition & Exhibits A-B 2
Upon the foregoing papers, and for the reasons stated below, Respondent's Motion is granted in part and denied in part. PROCEDURAL HISTORY & FACTUAL BACKGROUND
This is a nonpayment eviction proceeding brought by Petitioner 1775 Clay Realty LLC against Respondents Delilah Fleming and Rachel Fleming, Rent Stabilized tenants. The Petition, dated July 5, 2016, alleges that the monthly rent is $1044.72 and alleges "rent and additional rent" due of $2,618.85, comprised of $674.28 for May 2016, $703.25 for June 2016 and $1,241.32 for "RETRO-CHARGE" attributed to June 2016. The Petition also states that the rent was demanded from the tenant by a three-day written notice, a copy of which is attached with proof of service. The rent demand, dated June 22, 2016, alleges "rent and additional rent" due of $2,726.35, comprised of $78.53 for April 2016, $703.25 for each of the months of May and June 2016 and, as in the Petition, a "RETRO-CHARGE" of $1,241.32 attributed to June 2016.
Respondent pro se filed an Answer to the Petition on July 12, 2016, using the court's Answer form (CIV-LT-91 [Revised Oct 2014]), in which she checked off a "General Denial" and three specific defenses:
(1) "The monthly rent asked for is not the legal rent or amount on the current lease";
(2) "The rent, or a part of the rent, has already been paid to the Petitioner"; and
(3) The existence of conditions in the apartment and/or building which Petitioner did not repair.
At the initial court appearance on January 15, 2016, the file jacket notation indicates that the case was adjourned to August 8, 2016, with an APS (Adult Protective Services) referral for Respondent Rachel Fleming and a referral to a legal services provider for Respondent Delilah Fleming. Bronx Legal Services thereafter was retained by and appeared for Delilah Fleming, and stipulated with Petitioner's attorney on September 30, 2016 to deem Respondent's Amended Answer properly served and filed and adjourn the case to November 15, 2016 "for Petitioner to provide an explanation for 'Retro-charge' of $1,241.32 as stated in the petition and rent demand." A Stipulation dated November 15, 2016 adjourned the proceeding to February 1, 2016 for trial, with the additional provision that "Respondent's attorney to review MCI [major capital improvement] order documents provided by petitioner today in court, and subpoena/foil DHCR if needed."
Respondent Delilah Fleming by her attorney then served and filed a motion returnable February 1, 2016 seeking (1) leave to interpose a second Amended Answer, which differs from the first Amended Answer in that it contains a new "Second Defense" of res judicata; and (2) dismissal of the Petition pursuant to CPLR § 3212 based upon res judicata and/or defective rent demand (asserted as the "First Defense" in both the first Amended Answer and the proposed second Amended Answer). PRIOR NONPAYMENT PROCEEDING
Underlying Respondent's proposed res judicata defense are two Orders issued on May 6, 2013 and September 9, 2013 and two Stipulations of Settlement executed on September 18, 2013 and October 8, 2013 in a prior nonpayment proceeding, 1775 Clay Realty LLC v Theresa Goodson, Bronx Co L & T Index # 1456/12, which Petitioner commenced against Respondents' mother, Theresa Goodson, the former tenant of record. That proceeding was ultimately resolved in the Stipulation of Settlement dated October 8, 2013, which restored Delilah and Rachel Fleming to possession of the premises after payment of $17,700 "in full satisfaction of all amounts due through Sept 30, 2013", plus an additional payment of $703.25 as all rent due for the month of October 2013. That Stipulation further vacated the judgment and warrant, discontinued the proceeding and required Petitioner to provide Delilah and Rachel Fleming with a lease "as described in the 9/18/13 Stipulation."
Under the September 18, 2013 Stipulation, which noted that "The landlord has been provided with various DRIE [Disability Rent Increase Exemption Program] orders recently issued," Petitioner agreed to accept $17,700 "in full satisfaction of all amounts owed through Sept. 30, 2013, to be paid by 10/4/13." Petitioner also agreed to give Delilah and Rachel Fleming "a lease in their names retroactive to the termination date of the last lease, therefore commencing on 9/1/13, so that a DRIE extension can be obtained."
The September 18, 2013 Stipulation was executed on the heels of the Court's Order of September 9, 2013, which granted Respondents' post-eviction Order to Show Cause to the extent of ordering Petitioner to restore them to possession of the apartment upon payment and/or issuance of DRIE credits in the amount of $23,163, based on the finding that "arrears per petitioner w/MCI are $19,663," plus legal and City Marshal fees which the court capped at $3500, by September 23, 2013. The Court's earlier Order of May 6, 2013, which granted Respondents' Order to Show Cause to the extent of staying execution of the warrant of eviction through May 22, 2013 for payment in full, noted that "arrears are $13,624.66 including $1255.22 in MCI increases." RESPONDENT DELILAH FLEMING'S MOTION
On the Court's hand-written Decision/Order form, an arrow extends above the acronym "MCI" to an illegible number in parentheses.
Petitioner sought legal and City Marshal fees of $5000, and in granting the lower amount the Court noted that it "deems $3500 a reasonable sum ."
In her motion, Respondent seeks dismissal of the Petition on her first defense of defective predicate rent demand, Affirmation in Support at Point IV, ¶¶ 33-42, or, alternatively, partial summary judgment on the claim that "res judicata bars a dispute over the alleged MCI retro-charge, which was litigated in a prior nonpayment proceeding", Affirmation in Support at Point II, ¶¶ 20-25, and at Point V, ¶¶ 43-49. As the res judicata defense was not raised in her first Amended Answer, Respondent also asks the Court to deem duly served and filed her proposed second Amended Answer, which adds res judicata as a second defense.
Respondent argues that the rent demand is defective for two reasons. First, because the allegation of "June 16 Retro-Charge" in the amount of $1,241.32 relates to "MCI retroactive charges" which "were at issue and resolved in a prior nonpayment proceeding which concluded in a settlement of all claims through September 30, 2013." Affirmation in Support at ¶ 39. Second, because "Petitioner's own rental breakdown indicates payment was posted on April 11, 2016 MO 46339 and May 10, 2016, MO 02166" and therefore the rent demand improperly alleges rent owed of $78.53 for April 2016 and $703.25 for May 2016. Id. at ¶ 40. In sum, Respondent argues that the rent demand and petition "have thus failed to set forth the actual basis for Petitioner's rental claims, and instead demonstrate an attempt to collect twice on the same MCI orders and rent for April and May 2016." Id. at ¶ 41. Attached to Respondent's moving papers as Exhibit L is page 8 of a rent ledger dated August 4, 2016, covering the period of April through July 2016, which reflects that in each of the months of April and May 2016 Petitioner received payments from or on behalf of Respondents adding up to $703.25. In June 2016 Petitioner received two "DSS" (New York City Department of Social Services) checks for $107.50 each for a total $215, and in July 2016 Petitioner received nothing.
On her proposed res judicata defense, Respondent argues that "the alleged MCI retroactive charges were previously litigated in the prior nonpayment proceeding, index LT-01456-12/BX," Affirmation in Support at ¶ 48, which concluded with a settlement in full satisfaction "of all claims for rent owed through September 30, 2013," id.
Petitioner opposes Respondent's motion, arguing that the prior proceeding only resolved rent and MCI amounts owed through September 2013, Affirmation in Opposition at ¶¶ 6-8, 10, and that its rent demand "asserted a good faith approximation of the amount owed," id. at ¶ 10. Petitioner does not provide any explanation of, or justification for, the "RETRO-CHARGE" of $1,241.32 attributed to June 2016, and instead asserts that it now has decided "to halt and reverse Respondent's MCI charges," id. at ¶ 9, and that its waiver of the disputed MCI charges renders Respondent's motion moot, id. at ¶¶ 12-13.
Petitioner does not address Respondent's second basis for challenging the rent demand, but does attach as Exhibit B pages 10 through 13 of a rent ledger dated March 7, 2017, covering the period of January 2016 through March 2017. Petitioner's Exhibit B is similar to Respondent's Exhibit L in that it reflects receipt in each of the months of April and May 2016 — as well as in each of the immediately prior months of January, February and March 2016 - of funds totaling $703.25, followed by $215 in the form of two DSS checks for $107.50 each in June 2016, and then nothing in July 2016.
DISCUSSION Initially, the Court will address Respondent's claim that the legal doctrine of res judicata bars Petitioner from now seeking to collect any retroactive MCI charges because that claim was previously litigated in a prior nonpayment proceeding. See generally Smith v Russell Sage Coll (54 NY2d 185, 192, 193, 445 NYS2d 68, 429 NE2d 746 [1981]); Lanzano v City of New York (202 AD2d 378, 609 NYS2d 891 [1st Dep't 1994]). As Petitioner correctly points out, the prior nonpayment proceeding only definitively resolved rent and additional rent amounts owed through September 30, 2013, which does not bar Petitioner from seeking sums which may have become due after that date. There is nothing in the Petition or predicate rent demand to indicate that any of the rent or additional rent sought accrued before September 30, 2013. Accordingly, Respondent's motion to dismiss and/or for partial summary judgment is denied to the extent it relies on a theory of res judicata, and Respondent's motion for leave to interpose a second amended answer, and to deem the attached "Proposed Amended Answer" properly served and filed, is denied.
The final Stipulation of Settlement in that case, dated October 8, 2013, states that in addition to paying over $17,700, "in full satisfaction of all amounts due through September 30, 2013," Respondents gave Petitioner a money order of $703.25 "in payment of Oct 2013, including the period Oct 1, 2013 through Oct. 31, 2013." While it thus appears that Respondents' share of the rent may have been paid in full through October 31, 2013, there is some ambiguity in the wording regarding the October payment, as compared to the phrase covering rent due through September 30, 2013.
The Court also notes that the res judicata defense as articulated in the Proposed Amended Answer attached as Exhibit K to the moving papers does not appear to relate to the within proceeding.
However, Respondent is correct that the Petition must be dismissed as it is based on an unamendable, defective predicate rent demand. On a motion to dismiss under CPLR R 3211(a)(7) for failure to state a cause of action, the court is required to afford a liberal construction to the pleading and ascertain whether it alleges facts which fit within any "cognizable legal theory." Leon v Martinez (84 NY2d 83, 614 NYS2d 972 [1984]). The court must "accept the facts as alleged in the complaint as true, accord plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory." Id. (84 NY2d at 87-88). A court may consider evidentiary material submitted by a defendant (or a respondent in a special proceeding under CPLR Article 4) in support of a motion to dismiss pursuant to CPLR 3211(a)(7). Sokol v Leader (74 AD3d 1180, 1181, 904 NYS2d 153[2nd Dep't 2010]). When evidentiary material is considered on such a motion, and the motion has not been converted to one for summary judgment, "the criterion is whether the [plaintiff] has a cause of action, not whether he [or she] has stated one, and, unless it has been shown that a material fact as claimed by the [plaintiff] to be one is not a fact at all and unless it can be said that no significant dispute exists regarding it . . . dismissal should not eventuate." Guggenheimer v Ginzburg (43 NY2d 268, 275, 372 NE2d 17, 401 NYS2d 182[1977). See, e.g., Leak v Live Well Fin, Inc (145 AD3d 992, 993, 44 NYS3d 477 [2nd Dep't 2016]).
As a side note, Respondent's Point IV A in its moving papers that "A Post-Answer Motion to Dismiss Must be Brought Under CPLR § 3212" is incorrect. A motion to dismiss based on failure to state a cause of action under CPLR R 3211(a)(7), including failure to state a cause of action due to a defective rent demand, may be made at any time. See CPLR R 3211(e). The two cases Respondent cites to in the first paragraph of its Point IV A are inapposite as they both involve motions to dismiss brought under CPLR R 3211(a)(1),
To state and maintain a cause of action for nonpayment of rent, the petition must state the facts upon which the proceeding is based. RPAPL § 741(4). Further, the predicate rent demand required by RPAPL § 711(2) must "clearly inform the tenant of the particular period for which a rent payment is allegedly in default and the approximate good faith sum of rent assertedly due for each such period." Schwartz v Weiss-Newell (87 Misc 2d 558, 561, 386 NYS2d 191 [Civ Ct NY Co 1976]), quoted in 542 Holding Corp v Prince Fashions, Inc (46 AD3d 309, 848 NYS2d 37 [1st Dep't 2007]). A proper predicate rent demand is a condition precedent to commencement of a nonpayment proceeding and cannot be amended nunc pro tunc. Chinatown Apts v Chu Cho Lam (51 NY2d 786, 787, 412 NE2d 1312, 433 NYS2d 86 [1980]); Cypress Ct Assoc v McLauren (33 Misc 3d 1203[A], 938 NYS2d 226 [Civ Ct Kings Co 2011]); Vartarian v Brady (184 Misc 2d 333, 707 NYS2d 285 [Civ Ct NY Co 1999]); Parkchester Apts Co v Walker (1995 NY Misc LEXIS 738, 213 NYLJ 123 [Civ Ct Bx Co 1995]).
Here, dismissal is warranted for failure to state a cause of action under CPLR R 3211(a)(7) because the rent demand alleges rent arrears of $2,726.35 without asserting facts which fit within any "cognizable legal theory" under which Respondents could owe said sum. Leon v Martinez, supra. Rather, this is a case in which "a material fact as claimed by the [petitioner] to be one is not a fact at all and no significant dispute exists regarding it ." Guggenheimer v Ginzburg, supra. While the rent demand asserts that Respondents owe rent of $78.53 for April 2016, $703.25 for May 2016, $703.25 for June 2016, Petitioner's own rent ledger establishes unequivocally that it received from or on behalf of Respondents their full share of the rent of $703.25 for the months of April and May 2016, and that Petitioner received DSS checks in June 2016 of $215, leaving due for that month $488.25, not $703.25. The rent ledgers submitted by both sides are evidentiary materials which this court can consider on this motion to dismiss. Sokol v Leader, supra.
Based on the monthly rent of $1044.72 (Petition at ¶ 2), and after subtracting the monthly DRIE credit of $341.47 (appearing on the ledgers as "DRI - DIS RENT INC E"), the amount of $703.25 appears to be exactly Respondents' share of the rent.
As for the indeterminate "RETRO CHARGE" of $1,241.32 attributed on the rent demand to June 2016, while the parties agree that this item refers to "MCI retro charges", Affirmation in Opposition at ¶¶ 7, 10; Affirmation in Support at ¶¶ 16-18, this is nowhere stated on the rent demand, which also does not explain how the "RETRO CHARGE" was calculated; clearly, "the period for which such claim is made" is not limited to the month of June 2016 as stated on the rent demand. Schwartz v Weiss-Newell (87 Misc 2d 558, 561, 386 NYS2d 191, 194 [Civ Ct NY Co 1976]).
Petitioner's rent ledger covering the period of January 2016 through March 2017, attached as Exhibit B to its attorney's Affirmation in Opposition, includes monthly charges under the heading "MCR — RETRO-CHARG" which start at $952.12 in January 2016 and thereafter increase by $48.20 per month, with the total at $1626.92 as of March 2017.
Petitioner's argument that its mid-litigation decision to waive its claim for unpaid MCI charges renders Respondent's motion moot is unavailing. A proper rent demand is a condition precedent to a nonpayment proceeding which Petitioner must plead and prove along with the other elements of its case. RPAPL § 711(2). See, e.g., JDM Washington St, LLC v 90 Washington Rest Assoc, LLC (36 Misc 3d 769, 950 NYS2d 647 [Civ Ct NY Co 2012])("the service of a valid predicate notice is a condition precedent for a nonpayment proceeding, and nothing in the RPAPL precludes respondents from raising the issue at trial"); Zenila Realty Corp v Masterandrea (123 Misc 2d 1, 472 NYS2d 980 [Civ Ct NY Co 1984])(a proper rent demand is "a long-established prerequisite to the maintenance of a summary proceeding"). CONCLUSION
Accordingly, Respondent's motion is granted to the extent of dismissing the Petition, without prejudice. Copies of this Decision & Order will be provided to the parties' respective counsel in the courthouse. Dated: July 18, 2017 Bronx, New York Diane E. Lutwak, Hsg. Ct. J.