Opinion
No. 37686/2016.
10-20-2016
ELG 1275 LLC, Petitioner–Landlord, v. Veronica REYES, Respondent–Tenant.
Arun Perinbasekar, Esq., Sidrane & Schwartz–Sidrane, LLP, Rockville Centre, Attorney for Petitioner. Sara E. Smith, Esq., Legal Services NYC, Bronx, Attorney for Respondent.
Arun Perinbasekar, Esq., Sidrane & Schwartz–Sidrane, LLP, Rockville Centre, Attorney for Petitioner.
Sara E. Smith, Esq., Legal Services NYC, Bronx, Attorney for Respondent.
DIANE E. LUTWAK, J.
Recitation, as required by CPLR Rule 2219(a), of the papers considered in the review of the Respondent's Motion for Leave to File Amended Answer, Summary Judgment, Sanctions and Attorneys' Fees:
| Respondent's Notice of Motion & Attached Affirmation, Affidavit and Exhibits A–K | 1 |
| Respondent's Memorandum of Law | 2 |
| Petitioner's Affirmation in Opposition & Attached Exhibits A–C | 3 |
| Affirmation in Reply | 4 |
Upon the foregoing papers, the Decision and Order on this Motion are as follows:
BACKGROUND
This is a proceeding for nonpayment of rent brought against a Rent Stabilized tenant whose rent is subsidized by the federal Section 8 Housing Choice Voucher Program, administered by the New York City Housing Authority ("NYCHA"). Petitioner seeks a final judgment for possession of the premises and a money judgment for rent arrears of $4212.77, comprised of the tenant's share of the rent for the months of July and August 2012, July and August 2013, April 2015 and November 2015 through June 2016. Both parties are represented by counsel. Respondent moves for leave to interpose an amended answer, summary judgment and dismissal of the proceeding, sanctions and attorneys' fees. For the reasons discussed below, this Court grants respondent's motion to the extent of deeming the proposed amended answer duly served and filed, granting summary judgment and dismissing the petition without prejudice.
PROCEDURAL HISTORY
Prior to commencing this proceeding, as required by the Second Partial Consent Judgment in Williams v. NYCHA, 81 CIV 1801 (SDNY Feb. 2, 1995, R.J.W.) ("Williams Consent Decree"), petitioner prepared and sent respondent and NYCHA a form entitled "Certificate of Basis for Eviction Proceeding Against Tenant Participating in the Section 8 Housing Choice Voucher Program", dated January 25, 2016, advising that it intended to commence an eviction proceeding against respondent for nonpayment of her share of the rent under the Section 8 Program. Specifically, petitioner indicated that it sought rent at the rate of $312 per month for the four months of April 2015, November 2015, December 2015 and January 2016; $366 per month for each of the months of July and August 2012; and $302 per month for each of the months of July 2013 and August 2013. Petitioner indicated in the form that the total Contract Rent for the apartment is $1304.96 and that it was not seeking to recover from the tenant the Section 8 subsidy portion of the rent.
NYCHA replied to petitioner's certification by completing the bottom section of the form, which it dated February 9, 2016, thereby advising both the landlord and the tenant that it "OBJECTS TO the Certification for the reason(s) checked below." NYCHA checked off box "C": "The proposed non-payment proceeding seeks to recover from the tenant more than the share of rent for which the tenant is responsible." In particular, with regard to the month of April 2015, NYCHA noted that the tenant's share was $267 ("T/S $267.00 for 4/15"), as opposed to $312 as listed by petitioner in the top portion of the form.
Petitioner then prepared and served on respondent a rent demand dated March 2, 2016, with a copy to NYCHA, the main section of which reads as follows:
PLEASE TAKE NOTICE that you have defaulted in the observance and performance of your obligation, in that you have failed to pay to the Landlord all rent in the total sum of Three Thousand Two Hundred Seventy Six Dollars and Seventy Seven Cents ($3,276.77), due for the period of July 1, 2012 to March 31, 2016, as follows and represents Tenant's share of rent:
Total monthly rent due: 10/15 to 3/16: $1304.96—Section 8 $722.96, Tenant $312.00
| Jul 2012 share | $366.00 | Dec 2015 share | $312.00 |
| Aug 2012 share | $366.00 | Jan 2016 share | $312.00 |
| Jul 2013 share | $302.00 | Feb 2016 share | $312.00 |
| Apr 2015 share | $267.00 | Mar 2016 share | $312.00 |
| Nov 2015 share | $312.00 |
Petitioner thereafter commenced the within proceeding for nonpayment of rent by filing and serving a Notice of Petition and Petition dated June 21, 2016 seeking possession and a money judgment for the rent due under the Rent Demand plus rent for April, May and June 2016 at the rate of $312.00 per month for a total of $4,212.77. A copy of the rent demand is annexed to the Petition as Exhibit "A". The Petition asserts that petitioner "has provided both NYCHA Section 8 and Respondent–Tenant notice of intent to commence an eviction proceeding pursuant to the Williams Consent Decree", Petition at ¶ 13, references the certification form described above and the fact that a copy is annexed as Exhibit "B", and further asserts that "NYCHA had objected [to] the Landlord's Certification of the Basis to Commence this proceeding based on the amount being sued for on 4/15, however the amount was changed on the Rent Demand to satisfy this objection." Petition at ¶ 15.
Respondent pro se answered the petition on July 8, 2016, raising defenses of partial payment and breach of the warranty of habitability and a counterclaim ("withheld payments due to repairs"), and the court initially calendared the proceeding for July 15, 2016. The case was adjourned to August 9, 2016 for petitioner to subpoena NYCHA, and respondent appeared by counsel on that date. The proceeding was then adjourned for motion practice.
MOTION FOR LEAVE TO AMEND ANSWER
It is well-settled that leave to amend a pleading is freely granted under CPLR § 3025 absent a showing of prejudice or surprise. Mezzacappa Bros., Inc. v. City of New York, 29 AD3d 494, 815 N.Y.S.2d 549 (1st Dep't 2006) ; Valdes v. Marbrose Realty, Inc., 289 A.D.2d 28, 29, 734 N.Y.S.2d 24 (1st Dep't 2001) ; Igbara Realty Corp. v. New York Property Ins. Underwriting Assoc., 104 A.D.2d 258, 482 N.Y.S.2d 741 (1st Dep't 1984) ; 1515 Macombs, LLC v. Jackson, 50 Misc.3d 795, 20 N.Y.S.3d 869 (Civ.Ct. Bronx Co.2015) ; 601 W Realty LLC v. Chapa, 19 Misc.3d 1133(A)(Civ. Ct. N.Y. Co.2008). Whether to grant a motion to amend a pleading is a matter "committed almost entirely to the court's discretion to be determined on a sui generis basis, with the widest possible latitude being extended to the court." Murray v. City of New York, 43 N.Y.2d 400, 404–405, 372 N.E.2d 560, 401 N.Y.S.2d 773 (1977). The proposed amended pleading should be permitted unless it is "patently insufficient on its face." Hospital for Joint Diseases Orthopaedic Institute v. James Katsikis Environmental Contractors, Inc. et al., 173 A.D.2d 210, 569 N.Y.S.2d 91 (1st Dep't 1991).
Here, petitioner does not claim that it was surprised or would be unfairly prejudiced; its only objection is that the proposed Amended Answer is not verified by an individual with personal knowledge. However, RPAPL § 743 allows a respondent in a summary eviction proceeding under Article 7 of the RPAPL to answer the petition orally or in an unverified written answer. Turk v. B. Jakobsons & Son, 188 Misc. 203, 66 N.Y.S.2d 430 (App. Term 1st Dep't 1946) ; Profile Enters. LP v. Sanzo, 2005 N.Y. Misc. LEXIS 3403, 234 N.Y.L.J. 8 (Civ.Ct. N.Y. Co.2005). See also, e.g., Bruce L. Stein v. Jeff's Express, 37 Misc.3d 94, 955 N.Y.S.2d 713 (App. Term 2nd Dep't 2012) ; Mendicino Green Apt. Corp. v. Casimir, 32 Misc.3d 1220(A), 934 N.Y.S.2d 35 (Dist. Ct. Nassau Co.2011) (citing Landlord & Tenant Practice in New York, Daniel Finkelstein & Lucas A. Ferrara, Section 14:239). Petitioner cites to no authority—and the Court has found none—requiring that an amended answer be held to a different standard. Accordingly, this Court finds that the proposed Amended Answer is not "patently insufficient on its face," grants respondent's motion for leave to serve and file an amended answer and deems the proposed Amended Answer annexed to the moving papers as Exhibit A duly served and filed.
MOTION TO DISMISS AND FOR SUMMARY JUDGMENT
The second, third and fourth defenses set forth in respondent's Amended Answer arise out of the Williams Consent Decree; respondent seeks dismissal of the petition based on petitioner's failure to comply with various of its requirements.
One of the hallmarks of the Williams Consent Decree is its set of notice and certification procedures, which landlords must comply with prior to bringing eviction proceedings based on, inter alia, nonpayment of rent. The procedures are elaborate, including time frames for, and manner of delivery of, pre-litigation notification to NYCHA and the tenant using the "Certification of Basis for Eviction Proceeding" form attached to the Consent Decree. The Certification must be executed by someone with personal knowledge of the relevant facts, and must contain sufficiently specific factual allegations to allow the tenant to prepare a response or defense, including "an accurate breakdown of the source of the arrearage and the total amount claimed from the tenant for each month at issue". Williams Consent Decree at pp. 3–4, ¶ 7(b). NYCHA must object to the Certification where it finds any one of a list of five problems, including where "The proposed nonpayment proceeding seeks to recover from the tenant more than the share of rent for which the tenant is responsible." Id. at p. 4, ¶ 8(c). NYCHA is required to convey any such objection to both the landlord and the tenant in writing by completing the lower portion of the Certification form submitted by the landlord. Id. at p. 4, ¶ 9. If NYCHA objects to the landlord's Certification and the landlord commences an eviction proceeding against the tenant, "the landlord shall name and serve [NYCHA] as a necessary party and shall commence a single proceeding against the tenant and [NYCHA]. The failure to name and serve [NYCHA] as a party shall require dismissal of the proceeding without prejudice." Id. at p. 5, ¶ 12.
Strict compliance with the Williams Consent Decree is required. See, e.g., Renaissance Equity Holdings LLC v. O'Neil, 2009 N.Y. Misc. LEXIS 2416, 241 NYLJ 91 (Civ.Ct. Kings Co.2009)(tenant's motion for leave to file an amended answer and for summary judgment granted where Certification to NYCHA inaccurately included air conditioner fees that were not separated out from the rent); Dsouza v. Vassell, 2008 N.Y. Misc. LEXIS 4885, 240 NYLJ 21 (Civ.Ct. Richmond Co.2008)(tenant's motion to vacate stipulation of settlement and dismiss nonpayment proceeding granted where landlord sued for more than the tenant's share of the rent and failed to comply with various of the requirements of the Williams Consent Decree); 1319 St. John's Realty LLC v. Conley, 2008 N.Y. Misc. LEXIS 8330, 2008 N.Y. Slip Op 30625(U)(Civ. Ct. Kings Co.2008) (tenant's motion to dismiss granted in nonpayment proceeding based on landlord's failure to comply with the certification procedures of the Williams Consent Decree after the Section 8 subsidy had been suspended due to the apartment having failed inspection); Alawlaqi v. Kelly, 175 Misc.2d 570, 571, 669 N.Y.S.2d 152, 153 (Civ.Ct. Kings Co.1997) (tenant's motion to dismiss holdover proceeding granted where, after NYCHA indicated it had no objection, landlord served the petition on NYCHA by regular mail only, and did not comply with the service requirements set forth in the Williams Consent Decree).
The language of the Williams Consent Decree is clear with regard to what a landlord must do if NYCHA objects to the Certification: the landlord "shall"—unequivocally—name and serve NYCHA as a necessary party if it commences a nonpayment proceeding against the tenant. Williams Consent Decree at p. 5, ¶ 12. Petitioner did not comply with this requirement, and defends its decision not to by explaining that it deferred to NYCHA's assertion that the tenant's share of the rent for the month of April 2015 was $267, not $312, by listing that lower amount in both its predicate rent demand and nonpayment petition. However, once NYCHA objected to the Certification, strict compliance with the Williams Consent Decree required petitioner to name and serve NYCHA as a necessary party and its failure to do so warrants dismissal of this proceeding.
Even if the Court were to find petitioner's noncompliance with the Williams Consent Decree to be de minimis, there are numerous errors in the predicate rent demand which also, collectively, warrant dismissal of the proceeding. First, the rent demand asserts, erroneously, that respondent had "failed to pay to the Landlord all rent in the amount of Three Thousand Two Hundred Seventy Six Dollars and Seventy Seven Cents ($3276.77), due for the period of July 1, 2012 to March 31, 2016." As can been seen from the breakdown that follows further down the page, the amount petitioner was demanding to be paid adds up to $2816, not $3276.77.
Second, the arrears petitioner seeks are not comprised of "all rent due for the period of July 1, 2012 to March 31, 2016", but rather are limited to selected months' rents, specifically two months in 2012, one month in 2013, three months in 2015 and three months in 2016.
Third, the rent demand asserts that there was a "Total monthly rent due" of "10/15 to 3/16: $1304.96—Section 8 $722.96, Tenant $312.00." Again, there are errors in this portion of the rent demand's text. As can been seen from the breakdown that follows, the month of "10/15" is not even being sought in this proceeding. In addition, when what petitioner lists as the Section 8 share of the rent—$722.96—is subtracted from what petitioner lists apparently as the full lease rent—$1304.96—the outcome is $582, not $312 as listed on the rent demand. Petitioner in its opposition papers explains that the $1304.96 was a typographical error, with an inadvertent reversal of two digits; that is, the full lease rent is $1034.96, not $1304.96, as reflected in the rent ledger attached to petitioner's opposition papers as Exhibit C as well as in the lease itself, attached to respondent's moving papers as Exhibit B.
Fourth, returning to the matter of respondent's rent for April 2015, which, as pointed out in NYCHA's Certification was $267, not $312, in fact, the evidence submitted by both petitioner and respondent indicates that petitioner received respondent's payment for this month prior to serving its rent demand and therefore it should not have been listed as unpaid. Respondent has provided documentation (Exhibit I to her moving papers) showing that she paid her share of the rent for April 2015 in the amount of $267 by Western Union money order # 17–197073452 dated April 9, 2015, which she had earmarked for "April 2015/Rent", and that it was deposited into petitioner's bank account on February 17, 2016. This is confirmed by petitioner's own rent ledger, attached as Exhibit C to its attorney's Affirmation in Opposition, which shows that a money order for $267 ending in the three digits "452" was credited to respondent's rent account on February 17, 2016. Accordingly, while it is not clear why it took so long for respondent's money order dated April 9, 2015 and earmarked to cover rent for April 2015 to be deposited, rent for April 2015 should not have been listed on the March 2, 2016 rent demand as unpaid.
Finally, respondent also traced two other money orders she had given petitioner to cover rent for months listed in the rent demand: (1) Western Union money order # 14–548224794 in the amount of $366 dated August 18, 2012, which she had earmarked for "August 2012/Rent", and (2) Western Union money order # 14–735979261 in the amount of $302 dated July 28, 2013, which she had earmarked for "July 13/Rent" (Exhibit I to respondent's moving papers). Petitioner's rent ledger confirms that these two payments were received and cashed in the months for which they were intended, as can be seen from the entries on the rent ledger dated August 29, 2012 (referencing a payment of $366 by money order ending in the digits "794") and July 31, 2013 (referencing a payment of $302 by money order ending in the digits ?261), but petitioner impermissibly ignored respondent's earmarkings, credited these payments to other months and then erroneously alleged that rent was unpaid for the months of August 2012 and July 2013 in its rent demand.
As explained by the Honorable Michael J. Pinckney in Shimon Realty, Inc. v. Stosko, 2002 WL 34731014 (Civ.Ct. Kings Co.2002), "It is a general principle of law that a payment of rent designated or earmarked for a specific month must be applied towards that month." See also, e.g., 1290 Ocean Realty LLC v. Massena, 46 Misc.3d 1223(A)(Civ. Ct. Kings Co.2015) ("generally, a debtor may direct how payments to a creditor are to be applied"); FAV LLC v. McBain, 42 Misc.3d 1231(A)(Civ. Ct. N.Y. Co.2014) (noting that checks in evidence showed that the tenant "designated the month that she intended the tender to pay for" and the landlord's ledger showed that it had in fact honored those intentions "which is proper").
In order to state and maintain a cause of action for nonpayment of rent, the rent demand and petition 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 N.Y.S.2d 191 (Civ.Ct. N.Y. Co.1976), quoted in 542 Holding Corp. v. Prince Fashions, Inc., 46 AD3d 309, 848 N.Y.S.2d 37 (1st Dep't 2007).
The numerous errors in the rent demand discredit any claim that it contains a good faith sum of rent "assertedly due for each such period", undermined respondent's opportunity to make the required payments, which is one of the purposes of a rent demand, Shimon Realty, Inc. v. Stosko, supra, and render the rent demand fatally flawed. A proper predicate rent demand is a condition precedent to commencement of a non-payment proceeding and cannot be amended nunc pro tunc. Chinatown Apts. v. Chu Cho Lam, 51 N.Y.2d at 787, 412 N.E.2d 1312, 433 N.Y.S.2d 86 (1980) ; Cypress Ct. Assoc. v. McLauren, 33 Misc.3d 1203(A), 938 N.Y.S.2d 226 (Civ.Ct. Kings Co.2011) ; Vartarian v. Brady, 184 Misc.2d 333, 707 N.Y.S.2d 285 (Civ.Ct. N.Y. Co.1999) ; Parkchester Apts. Co. v. Walker, 1995 N.Y. Misc. LEXIS 738, 213 N.Y.L.J. 123 (Civ.Ct.Bx.Co.1995).
CONCLUSION
Respondent has made a prima facie showing of entitlement to judgment as a matter of law on the issues of failure to comply with the Williams Consent Decree and the inadequacy of the rent demand, and petitioner not only has failed to respond with any evidence to the contrary but has submitted evidence which corroborates respondent's claims. Accordingly, respondent is entitled to summary judgment and dismissal of this proceeding, without prejudice to petitioner commencing a new proceeding that complies with the Williams Consent Decree and is based on an accurate explanation of the rent arrears. Alvarez v. Prospect Hosp., 68 N.Y.2d 320, 501 N .E.2d 572, 508 N.Y.S.2d 923 (1986) ; Zuckerman v. City of New York, 49 N.Y.2d 557, 562 (1980).
In light of the dismissal of the petition for the reasons stated above, there is no need for the Court to address respondent's other grounds for dismissal. With regard to respondent's request for an imposition of sanctions under 22 NYCRR # 130–1.1, there is no indication in the moving papers or the record of this case of the type of frivolous conduct that warrants sanctions. See, e.g., Levy v. Carol Mgmt. Corp., 260 A.D.2d 27, 698 N.Y.S.2d 226 (1st Dep't 1999) ; MEP Realty Ltd. v. Herman, 2008 N.Y. Misc. LEXIS 7406, 240 N.Y.L.J. 61 (Civ.Ct. Kings Co.2008); East Harlem Pilot Block Bldg. 1 Housing Dev. Fund Corp. v. Serrano, 153 Misc.2d 776 (Civ.Ct. N.Y. Co.1992). As for respondent's request for attorneys' fees, this branch of the motion is also denied, without prejudice, as the motion is not supported by a copy of the original Rent Stabilized lease between the parties; the lease must be produced to determine whether it contains an attorneys' fees provision and, if so, whether the language of that provision allows for attorneys' fees in this case. See, e.g., Graham Ct. Owner's Corp. v. Taylor, 115 AD3d 50, 978 N.Y.S.2d 213 (1st Dep't 2014) ; Matter of Casamento v. Juaregui, 88 AD3d 345, 929 N.Y.S.2d 286 (2d Dep't 2011) ; Klmni, Inc. v. 483 Broadway Realty Corp., 2013 N.Y. Misc. LEXIS 3279, 2013 N.Y. Slip Op 31699(U) (Sup.Ct. N.Y. Co.2013) ; MEP Realty Ltd. v. Herman, 2008 N.Y. Misc. LEXIS 7406, 240 N.Y.L.J. 61 (Civ.Ct. Kings Co.2008). Simply because respondent's current renewal lease consists of the standard Rent Stabilized renewal lease form ("RTP–8") required by Section 2523.5 of the Rent Stabilization Code, see, e.g., South Park Assocs., L.L.C. v. Renzulli, 94 F.Supp.2d 460 (S.D.NY 2000) ; Matter of Ashland Properties, LLC v. New York State Division of Housing and Community Renewal, 2008 N.Y. Misc. LEXIS 9774, 2008 N.Y. Slip Op 33030(U) (Sup.Ct. Nassau Co.2008), does not tell us anything about the terms of the original lease. Nor does the fact that the petition includes an attorneys' fees request confirm the existence or language of an appropriate attorneys' fees provision in the lease. Further, respondent has not cited any case law supporting her request for an award of attorneys' fees, and the Court notes there is authority for denying such a request without prejudice after dismissing a petition based on a defective rent demand where it is expected that the landlord will commence a new nonpayment proceeding. 95 River Co. v. Burnett, 160 Misc.2d 294, 297, 608 N.Y.S.2d 786, 788 (Civ.Ct. N.Y. Co.1993).
This constitutes the Decision and Order of this Court.