Opinion
Index No. L&T 315042/22
12-06-2023
Loumat Realty Company, LLC, Petitioner, v. Michael Gilkarov, ELIANA HAIMA, "JOHN DOE" & "JANE DOE," Respondents.
James E. Kasdon, Esq. Attorney for petitioner Elan Layliev, Esq., Attorney for respondents
Unpublished Opinion
James E. Kasdon, Esq. Attorney for petitioner
Elan Layliev, Esq., Attorney for respondents
Clinton J. Guthrie, J.
Recitation, as required by CPLR § 2219(a), of the papers considered in the review of respondent Michael Gilkarov's motion to serve a late answer pursuant to CPLR § 3012(d) and petitioner's cross-motion to deny petitioner's motion, for summary judgment, and for use and occupancy:
Papers Numbered
Amended Notice of Motion & Affirmation/Exhibit Annexed 1 (NYSCEF 21-23, 26)
Notice of Cross-Motion & Affidavit (in Support and in Opposition/Exhibits Annexed 2 (NYSCEF 27-48)
Affirmation in Reply and in Opposition 3 (NYSCEF 49)
Upon the foregoing cited papers, the decision and order on respondent's motion and the interim decision and order on petitioner's cross-motion (consolidated for determination herein) is as follows.
PROCEDURAL HISTORY
This residential holdover proceeding, based upon a "Sixty (60) Day Notice of Nonrenewal & Termination of Residential Sub-Tenancy" was filed in October 2022. The case first appeared in a resolution Part on December 21, 2022. Following one adjournment, the case was transferred to Part X for trial on March 6, 2023. At the time, respondent Michael Gilkarov appeared pro se. The case was scheduled for pretrial conference in this trial Part on July 28, 2023. Following the pretrial conference (where respondent Michael Gilkarov again appeared pro se), the case was adjourned for trial on September 26, 2023.
On September 26, 2023, respondent Michael Gilkarov appeared through counsel. On respondent's attorney's application and over petitioner's objection, the case was adjourned to October 26, 2023 for respondent to move to interpose an answer, with submission deadlines. In the interim, respondent's motion was filed, petitioner made a cross-motion for summary judgment and other relief, and respondent's attorney filed reply/opposition papers, albeit two (2) days late. On October 26, 2023, this court heard argument on both motions and excused the late filing of respondent's reply/opposition papers in a Decision/Order (NYSCEF Doc. 53). Decision was reserved on both motions after argument.
RESPONDENT'S MOTION TO INTERPOSE A LATE ANSWER
Respondent seeks to interpose an answer pursuant to CPLR § 3012(d). CPLR § 3012(d) provides that "[u]pon the application of a party, the court may extend the time to appear or plead, or compel the acceptance of a pleading untimely served, upon such terms as may be just and upon a showing of reasonable excuse for delay or default." However, in summary proceedings governed by the RPAPL, there is support for the time to answer under RPAPL § 743 being extended "by adjournment of the proceeding unless 'arrangements to the contrary' have been made." Aviles v. Santana, 56 Misc.3d 1206 [A], 2017 NY Slip Op 50887[U], *5 [Civ Ct, Bronx County 2017] [quoting Gluck v. Wiroslaw, 113 Misc.2d 499, 500 [Civ Ct, Kings County 1982]]; see also City of New York v. Candelario, 156 Misc.2d 330, 331 [App Term, 2d Dept, 2d & 11th Jud Dists 1993], affd in part and revd in part on other grounds 223 A.D.2d 617 [1996]; In-Towne Shopping Ctrs. Co. v. Demottie, 17 Misc.3d 134 [A], 2007 NY Slip Op 52200[U] [App Term, 2d Dept, 9th & 10th Jud Dists 2007]; Eugene Smilovic Hous. Dev. Fund Corp. v. Lee, 61 Misc.3d 1216 [A], 2018 NY Slip Op 51534[U] [Civ Ct, Bronx County 2018].
Under CPLR § 3012(d), courts will assess whether the party seeking to interpose an answer has a "potentially meritorious defense." NYU-Hospital for Joint Diseases v. Praetorian Ins. Co., 98 A.D.3d 1101, 1102 [2d Dept 2012]. The court finds that the answer may be interposed at this juncture as a furthering of the public policy favoring resolution of cases on the merits (NYU-Hospital for Joint Diseases, 98 A.D.3d at 1102) and insofar as the aforementioned case law governing RPAPL§ 743 supports the extension of the time to answer upon each adjournment in the absence of arrangements to the contrary (particularly when respondent has obtained counsel). However, the court will still assess the potential merit of respondent's proposed defenses in determining respondent's motion in light of its reliance on CPLR § 3012(d).
Respondent's proposed answer contains six affirmative defenses. The court will first assess the sixth affirmative defense, which concerns service of the notice of petition and petition, thus implicating personal jurisdiction. Personal jurisdiction is a "threshold issue" that must be determined before reaching any other issue. Elm Mgt. Corp. v. Sprung, 33 A.D.3d 753, 755 [2d Dept 2006]. The proposed defense merely states that respondents were "at home" at the times that the purported service occurred as per the affidavit of service. However, the defense does not state any other relevant information, such as whether the respondents heard or saw any attempt to serve them, nor does it specifically deny any specific element of conspicuous place service under RPAPL § 735(1). In order to rebut a process server's affidavit to warrant a traverse hearing, a party must set forth a "sworn, nonconclusory denial of service" of the notice of petition and petition. Tzifil Realty Corp. v. Temammee, 46 Misc.3d 144 [A], 2015 NY Slip Op 50196[U], *2 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2015]; see also Rox Riv 83 Partners v. Ettinger, 276 A.D.2d 782, 783 [2d Dept 2000]. Respondent's sixth affirmative defense, to the extent that it challenges personal jurisdiction, lacks critical details that would constitute a nonconclusory denial of service. Therefore, it is not sufficient to meet the standard to challenge the affidavit of service for the notice of petition and petition.
The proposed answer is titled "Amended Answer," but no prior answer has been filed herein.
The sixth affirmative defense also includes a challenge to service of the predicate notice of nonrenewal and termination. While service of a predicate notice does not affect personal jurisdiction (see 156 Nassau Ave. HDFC v. Tchernitsky, 62 Misc.3d 140 [A], 2019 NY Slip Op 50059[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]), a party challenging service of the predicate notice must still submit a "sworn, nonconclusory, factually specific denial of service[.]" Marmon Realty Group, LLC v. Khalil, 73 Misc.3d 136[A], 2021 NY Slip Op 50733[U], *2 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2021]. As with the prong of the affirmative defense addressing personal jurisdiction, the portion of the defense concerning the service of the predicate notice only states that respondents were "at home" on the purported dates of service of the notice. Without more, this is insufficient to specifically deny service of the predicate notice. Accordingly, respondent's sixth affirmative defense lacks merit and will be stricken.
Respondent's third affirmative defense also attacks service of the predicate notice, specifically alleging that service did not occur a full sixty (60) days before the expiration of the notice. However, the affidavit of service for the predicate notice (NYSCEF Doc. 4) states that service was complete upon mailings purportedly made on July 29, 2023. Thus, service was completed more than 60 days before the expiration of the termination notice on September 30, 2022. While the third affirmative defense states that "upon information and belief, the [p]etitioner attempted to serve the termination notice during the first week of August 2022," this allegation is factually insufficient to challenge the contents of the affidavits of service for the predicate notice. Accordingly, the third affirmative defense is stricken as meritless.
Unlike with a notice to cure (cf. Matter of ATM One v. Landaverde, 2 N.Y.3d 472 [2004]), five days are not added for mailing of a termination notice or notice of non-renewal of tenancy (see 85 Columbus Corp. v. Cooperman, 45 A.D.3d 358 [1st Dept 2007]; Brooklyn Home for Aged People Hous. Dev. Fund Co. v. Selby, 32 Misc.3d 130 [A], 2011 NY Slip Op 51314[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2011]).
The first and second affirmative defenses state that respondent executed a renewal lease before petitioner served the notice of termination. Petitioner opposes the affirmative defenses, arguing that respondent did not execute the sublease renewal offers in a timely fashion and only sent in an "accepted" sublease renewal after the termination notice had been served and notice of revocation of the offer was given. While petitioner's evidence includes an affidavit, the offered subleases, the envelope in which the "accepted" renewal was mailed, and the USPS tracking for the mailing, the court finds that at the pleading stage, respondents' first and second affirmative defenses are not patently devoid of merit.
The court stresses that this determination is made only in the context of interposing a late answer, not in the context of summary judgment.
As for the fourth affirmative defense, respondent asserts that the use and occupancy rate sought by petitioner is punitive and unenforceable. Petitioner counters that the lease provisions setting a holdover use and occupancy rate of $4,400.00 per month is a liquidated damages provision that is wholly enforceable and that comports with Real Property Law (RPL) § 229. However, RPL § 229 applies when a tenant has given notice of an intention to quit and holds over, which is not alleged in the petition here. Moreover, while a sublease provision provides for the holdover rate, respondent, who was originally pro se and is now represented by counsel, is entitled to challenge the propriety of the double holdover rate in this proceeding, where the appropriate standard for use and occupancy is the "fair rental value of the premises" (see Nisim v. Ramirez, 73 Misc.3d 126 [A], 2021 NY Slip Op 50877[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2021]; s ee also Vanchev v. Mulligan, 52 Misc.3d 138 [A], 2016 NY Slip Op 51121[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]; Sneddon v. Greene, 17 Misc.3d 1, 5 [App Term, 2d Dept, 9th & 10th Jud Dists 2007]).
With regard to the fifth affirmative defense, which asserts retaliatory eviction, petitioner also argues that it lacks merit. The defense pleads that the proceeding was commenced after respondent requested repairs and a made a complaint to 311. However, the defense does not state when the repairs request and complaint occurred vis-à-vis when the predicate notice was served or the proceeding was commenced. Without this information, the court cannot assess whether the rebuttable presumption contained in RPL § 223-b (RPL § 223-b(5) applies or whether the defense is relevant herein. Consequently, the court finds that the fifth affirmative defense lacks merit and shall be stricken.
Accordingly, for the foregoing reasons, respondent's motion to interpose an answer is granted, provided, however, that the third, fifth, and sixth affirmative defenses are stricken from the answer (NYSCEF Doc. 22). The answer, as modified, is deemed served and filed.
PETITIONER'S CROSS-MOTION
Petitioner's cross-motion seeks summary judgment against all respondents, the entry of a judgment of possession and a monetary judgment for use and occupancy, and an order requiring payment of use and occupancy pendente lite. The cross-motion is opposed via an attorney affirmation.
A party moving for summary judgment pursuant to CPLR § 3212 must "make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact." Alvarez v. Prospect Hosp., 68 N.Y.2d 320, 324 [1980] [internal citations omitted]. Upon the prima facie showing being made, "the burden shifts to the party opposing the motion for summary judgment to produce evidentiary proof in admissible form to establish the existence of material issues of fact which require a trial of the action." Id. Additionally, "CPLR § 3212(b) permits the court to search the record... where there is a pending motion for summary judgment, and then award judgment where it is warranted in favor of a nonmoving party[.]" (Santagata v. Vinegar Hill Group, LLC, 41 A.D.3d 576, 576 [2d Dept 2007]; see also Sce v. Ach, 56 A.D.3d 457, 459 [2d Dept 2008]). Similarly, in special proceedings, CPLR § 409(b) requires the court to "make a summary determination upon the pleadings, papers and admissions to the extent that no triable issues of fact are raised." See generally Matter of Addesso v. Addesso, 131 A.D.3d 1052 [2d Dept 2015]. This provision has been held to apply whether or not the basis for summary determination is raised by the parties (see Greenport Preserv., L.P. v. Heyward, 74 Misc.3d 46, 47 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2021]; 1646 Union, LLC v. Simpson, 62 Misc.3d 142 [A], 2019 NY Slip Op 50089[U], *3 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]; Fourth Hous. Co., Inc. v. Bowers, 53 Misc.3d 43, 45 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]).
The court has determined, upon review of the summary judgment record, that the Martin Act (see General Business Law § 352-eeee) may be applicable to respondent's tenancy (see Paikoff v. Harris, 185 Misc.2d 372, 377-378 [App Term, 2d Dept, 2d & 11th Jud Dists 1999] [Holding that a "non-puchasing tenant" as defined under the Martin Act is entitled to its protections]). Insofar as proper pleading of Martin Act applicability is required in a summary eviction proceeding (see Aero Mgt. v. Moghadasian, 74 Misc.3d 132 [A], 2022 NY Slip Op 50154[U], *2 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2022]; Kew Gardens Hills Apt. Assoc., L.P. v. Jeffers, 2003 NY Slip Op 51132[U] [App Term, 2d Dept, 2d & 11th Jud Dists 2003]), the issue necessarily impacts the determination of petitioner's motion for summary judgment, including the assessment of whether petitioner has a cause of action herein.
Therefore, the court will permit petitioner and respondent to submit supplemental briefs/memoranda, which may include evidentiary material, on the issue of Martin Act coverage to the instant tenancy. The Appellate Terms of the First and Second Departments have recently affirmed lower courts' decisions upon CPLR § 409(b) after the parties were afforded the opportunity to make supplemental submissions (see COD, LLC v. Ljuljdjuraj, 2023 NY Slip Op 51305[U], *1 [App Term, 1st Dept 2023]; Heyward, 74 Misc.3d at 47; see also CPLR § 409(a)). The submissions shall be filed to NYSCEF no later than 4:00 PM on December 22, 2023. If either party requests argument upon the Martin Act issue identified by the court, the submission submitted on behalf of that party shall state prominently on the first page that argument is requested. The court will schedule argument if either or both parties request argument. If neither party requests argument, decision will be reserved as of 4:00 PM on December 22, 2023.The court deems this to be the interim decision and order on petitioner's cross-motion. No ultimate determinations are made herein.