Opinion
6424/2005.
Decided March 21, 2006.
Pursuant to the parties' consent order dated December 13, 2005, ("consent order"), the respondent-landlord agreed to correct three "C" violations (i.e., concealed water leak, mold and plaster ceiling) and one "A" violation (i.e., paint ceiling), which were issued on December 1, 2005, and all located in the petitioner's first room east. The "C" violations were to be completed on/before December 30, 2005, and the "A" violation was to be completed within 90 days. By order to show cause dated January 6, 2006, the petitioners seeks, inter alia, civil contempt and civil penalties due to respondent-landlord's alleged failure to comply with the consent order, and reasonable attorney fees. In opposition, the respondent-landlord cross moves for an extension of time to comply with the consent order. On January 26, 2006, the parties' entered into a stipulation which provided that the civil penalties were settled at $2000.00, that "respondent shall complete all interior repairs at the subject premises . . . on or before February 6, 2006," and adjourned the proceeding and the balance of the order to show cause accordingly. On March 16, 2006, a civil contempt hearing was held and upon completion of said hearing the court makes the following findings of fact:
Mr. Steven Seplo, an agent for the respondent-landlord, testified that he retained the services of an architect, Robert Schwartz, to remove the violations under the parties' consent order. The balance of his testimony was not particularly useful, as he had no real first hand knowledge of the actual work done, but relied almost exclusively on Mr. Schwartz to handle the problem at hand. Mr. Schwartz testified that he had already determined some time in November 2005 that the leak into the petitioners' apartment emanated from the greenhouse attached to the penthouse apartment located directly above. In early December 2005, after some initial difficulty, he was finally able to find a waterproofing company to replace portions of the greenhouse gaskets and caulk which he thought were the source of the leak. The aforementioned repairs took place on December 8, 2005, and although Mr. Schwartz did perform a water test in November 2005 to locate the leaks, no such test was done after the December repairs. Some time over the New Year weekend, a heavy rainfall took place resulting in additional leaks to the petitioners' apartment. On or about January 5, 2006, Mr. Schwartz had the waterproofing company enclose the entire greenhouse in heavy gage plastic wrap.
It was the petitioners who called Mr. Seplo as a witness. The respondent-landlord only called one witness, Mr. Schwartz.
The petitioner, Helen Altman, produced photos depicting extensive water damage primarily to her master bedroom that precluded the use of this room and also required the placement of some furniture into storage. There was no testimony regarding either the monthly maintenance or the configuration of the subject apartment (i.e., number of rooms), nor were any receipts for storage costs introduced. Although none of the respondent-landlord's repair persons (e.g., super, painters, etc.) testified, Ms. Altman did acknowledge that plaster and paint work were recently done and that as of February 9, 2006, she was able to use the entire apartment. Ms. Altman also testified that the superintendent recently took moisture tests in her apartment, which appeared to indicate that some moisture still remained within the walls. According to Mr. Schwartz, the moisture readings only indicated residual moisture, and he has already prepared plans that were approved by the Department of Buildings on March 13, 2006, to replace the old greenhouse with a new one. He testified that it will take a few months to have the new greenhouse fabricated, and once this is done, the old one can be removed and the new one installed. The anticipated completion date is June 2006. It was during closing arguments that the petitioners made it clear that they sought damages in the form of an abatement, and attorney fees for both the instant contempt motion and the proceeding in whole. At the same time, the respondent-landlord made an application for an extension of time to correct the source of the leak. It is undisputed that all parties knew of the consent order, ( Dept. of Environmental Protection v. Dept. of Environmental Conservation, 70 NY2d 233, 519 N.Y.S.2d 539), and that the tarp around the greenhouse is merely a temporary fix in the respondent-landlord's attempt to correct the concealed water leak, which should have been corrected on/before December 30, 2005. When a consent order requires a landlord to correct violations in a tenant's apartment, the landlord's failure to effect the repairs necessarily prejudices the tenant. ( Various Tenants v. HPD, 153 Misc 2d 221, 588 N.Y.S.2d 840 [App. Term 1st Dept. 1992].) Clearly the petitioners' were prejudiced by their inability to use portions of their apartment due to extensive water damage, and as shareholders they have a right to assert a claim for a breach of the warranty of habitability and seek damages in the form of an abatement against the monthly maintenance paid to the respondent-landlord. ( Frisch v. Bellmarc, 190 AD2d 383, 597 N.Y.S.2d 962 [1st Dept. 1993].) The warranty of habitability was breached once conditions existed that violate the housing maintenance code, ( K.E. v. Realty, N.Y.L.J., May 31, 1996, pg. 26, col. 4 [Civ. Ct., NY Cty.]), and the proper measure for an abatement is the difference between the fair market value of the premises as warranted, which is usually measured by the rent or maintenance reserved under the lease, and the value of the premises during the period of the breach. ( Park v. Mitchell, 47 NY2d 316, 418 N.Y.S.2d 310.) Without testimony as to either the monthly maintenance amount, or the number of rooms affected by the leak versus the total number of rooms in the apartment, the court is unable to determine an appropriate abatement amount or percentage. Despite this inability to establish an actual loss in the form of an abatement, section 773 of the Judiciary Law does provide that costs and expenses for a contempt motion may be imposed, plus an additional two hundred and fifty dollars.
The respondent-landlord seeks to avoid liability by relying upon its expert architect; however, neither substantial compliance nor good-faith effort at compliance are defenses to civil contempt. ( McCain v. Dinkins, 84 NY2d 216, 616 N.Y.S.2d 335; Peters v. Sage, 238 AD2d 123, 655 N.Y.S.2d 500 [1st Dept. 1997].) The consent order specifically obligated the respondent-landlord to correct the concealed water leak on/before December 30, 2005. The parties' stipulation of January 26, 2006, merely extended the time in which the respondent-landlord had to complete the interior repairs (emphasis added) to February 6, 2006, and settled the civil penalties at $2000.00. Furthermore, this court is not persuaded by the respondent-landlord's reliance upon Levandusky v. One, ( 75 NY2d 530, 554 N.Y.S.2d 807), in which the business judgment rule was applied to the decisions of cooperative-governing associations enforcing building policy. This court is not called upon, nor does it have the jurisdiction, to review the decision by the respondent-landlord to hire Mr. Schwartz, and thereby rely upon his initial and subsequent repair recommendations — that decision is within the sole discretion of the respondent-landlord. ( Levandusky v. One, 75 NY2d 530, supra.) Having made that decision, however, the respondent-landlord cannot now rely on its alleged good-faith effort in retaining Mr. Schwartz, ( McCain v. Dinkins, 84 NY2d 216, supra), to somehow shield itself from civil contempt by relying on the business judgment rule and thereby place the blame for any resulting prejudice upon said expert/agent.
Even if it were available, it would be somewhat difficult to argue good faith in light of the failure to conduct a water test after the initial December 2005 repairs, the failure to call any of the repair persons as witnesses, and the extremely limited involvement by Mr. Seplo in overseeing the repairs.
Based on the aforementioned, the court finds that the petitioners' were prejudiced by the respondent-landlord's failure to correct the concealed water leak on/before December 30, 2005. Given the inability to establish actual damages (i.e., abatement), the court hereby awards the petitioners $250.00, (Judiciary Law § 773), which the respondent-landlord is directed to pay within 30 days after service of a copy of this decision with notice of entry. This award is without prejudice to the petitioners' seeking an abatement in a separate proceeding and/or action, and is in addition to the petitioners' entitlement to attorney fees for the contempt motion. As for the petitioners' request for attorney fees in prosecuting this proceeding, it is well established that said fees are available in a tenant initiated HP proceeding, ( Rosario v. 288 St. Nicholas, 177 Misc 2d 78, 676 N.Y.S.2d 754 [App. Term, 1st Dept. 1998]), and the proprietary lease between the petitioners and respondent-landlord does have an attorney fee provision. ( See, Real Property Law § 234.) Pursuant to the Housing Maintenance Code, (NYC Adm. Code §§ 27-2004(a)(45), 27-2005(b)), and the parties' proprietary lease and consent order, it is the responsibility of the respondent-landlord to ultimately correct the conditions, (i.e., leak and resulting damage), which gave rise to this tenant-initiated code enforcement proceeding. ( Nestor v. McDowell, 81 NY2d 410, 599 N.Y.S.2d 507; 313 v. Kepasi, 143 Misc 2d 566, 545 N.Y.S.2d 54 [App. Term, 1st Dept. 1989].) The consent order itself is wholly favorable to and secured the central relief sought by the petitioners, ( Rosario v. 288 St. Nicholas, 177 Misc 2d 78, supra), and as such, they are the prevailing party entitled to attorney fees under the proprietary lease. ( Parkchester v. Erenstein, N.Y.L.J., Oct. 31, 1991, pg. 23, col. 2 [App. Term 1st Dept.].) Therefore, once the violations have finally been corrected, the petitioner may restore this proceeding for a hearing to determine the proper amount of reasonable attorney fees for the entire proceeding, including the contempt motion. Lastly, based on the testimony by Mr. Schwartz, the respondent-landlord's time to correct the concealed water leak is extended to June 30, 2006. This constitutes the decision and order of this court, copies of which are being mailed by the Court to counsel for the parties. The parties are directed to pick-up their exhibits in Part B, room 526, on/before April 14, 2006.