Opinion
066400/2003, 067484/2003, 066399/2003.
Decided September 30, 2003.
Richman Fingerhut, P.C., New York City (Annmarie S. Picone-Delarco of counsel), for petitioner.
De Lotto Fajardo, L.L.P., New York City (Lauren De Lotto of counsel), for respondents.
DECISION/ORDER
Recitation, as required by CPLR 2219 (a), of the papers considered in reviewing petitioner's motion for discovery and to compel examinations before trial and for respondents' cross-motion for summary judgment.
These three holdover proceedings involve the same petitioner, the same building, the same attorneys, and the same issues of law. For the sake of judicial efficiency and economy, the court consolidates all three motions into one omnibus decision. Petitioner's motions for discovery and to compel examination before trial for these three proceedings are granted. Respondents' cross-motions for summary judgment are denied.
Petitioner argues that respondents are violating article five of their occupancy agreement, which requires them to use their premises as their private dwellings. Petitioner argues that the term "private dwelling," as used in article five of the occupancy agreement and in accordance with the HUD Handbook, requires respondents to maintain their premises as their primary residences. Respondents in all three proceedings oppose petitioner's motions. Respondents argue that the court should grant summary judgment in their favor. According to respondents, petitioner failed to demonstrate that they do not reside in the premises and that they are keeping their premises as private dwellings. Petitioner alleges that respondent Eyal Maor maintains his primary residence at 700 Kennedy Boulevard, Apartment 48H, Guttenberg, New Jersey 07093; that respondents David Kuliner and Lia Kuliner maintain their primary residence at 257 Caroline Street, Derby, Connecticut 06418; and that respondent Efrat Nizan maintains his primary residence at 109 Boulevard Drive, Danbury, Connecticut 06810. Petitioner further alleges that all the respondents are subletting their apartments in contravention of the agreement. Respondents claim that they are either not subletting or that they are subletting with petitioner's knowledge and consent.
Respondents argue that the petitions are defective because they offer alternative, inconsistent grounds for terminating the tenancy. If a petition and notice of petition offers alternative grounds for termination, the termination will be invalid only if the stated grounds are inconsistent with one another. ( See e.g. Sunset Park Development Corp. v. Hickerson, NYLJ, Oct. 8, 1997, at 27, col 2 [Civ Ct, Kings County].)
Respondents contend that alleging alternative, inconsistent grounds in the termination notice and petition to terminate the tenancy is a fatal defect requiring dismissal. To support their position, they cite to City of New York v. Bullock ( 164 Misc 2d 1052 [App Term, 2d 11th Jud Dists, 1995, mem]); Newman v. Sirkin ( 153 Misc 2d 864 [Civ Ct, NY County 1992]); Tik Sun Chenug v. Xaio Man Li ( 148 Misc 2d 55 [Civ Ct, Kings County 1989]); and Cypress Holding Corp. v. Navar (NYLJ, Jul. 19, 1989, at 20, col 2 [Hous Part, Civ Ct, Kings County]). According to respondents, these cases preclude petitioner from pleading in the same petition that respondents are not using the premises as their private dwelling and they are illegally subletting. Respondents argue that these cases require the court to dismiss the petition over petitioner's pleading both causes of action in the same petition.
Respondents' cases are inapposite. In all the cases, the petitioner, in the termination notice, pleaded that the respondents were either licensees or squatters. Apart from Tik Sun, all the cases acknowledge that this pleading is ordinarily valid but that an in-the-alternative pleadings must be made with specificity. As the Bullock court held, "in order to satisfy the requirement of stating the facts upon which the proceeding is based, an essential allegation in the notice where alternative pleading is permitted must be an explanation as to why the petitioner does not know the respondent's status." ( 159 Misc 2d at 719.) The Newman court, on similar facts, gave the rationale for that holding, finding that "petitioners were not required to choose between describing respondent as either a licensee or a squatter, and risk dismissal if they proved one rather than the other." ( 153 Misc 2d 864.) Although Tik Sun held that an alternative pleading renders the termination notice defective ( see 148 Misc 2d at 58), this court declines to follow its holding because 349 E. 49th St. Equities v. Vought (NYLJ, May 27, 1982, at 5, col 4 [App Term 1st Dept, per curiam]), a case from the Appellate Term, First Department, affirmed an award of possession even though the petitioner pleaded in the alternative that respondents were squatters and licensees.
Respondent also cites Sunset Park (NYLJ, Oct. 8, 1997, at 27, col 2), which holds that a petition alleging alternative, inconsistent theories must be dismissed. If the alternative grounds are consistent, on the other hand, a petitioner must plead both grounds or risk losing the case and being estopped from proceeding on the alternative theory. Here, petitioner's grounds are consistent. The petitions allege that respondents are not occupying the premises as private dwellings and, rather, that respondents are subletting the premises in violation of their occupancy agreement. Article five of the agreement provides that "[t]he Member shall occupy the dwelling unit covered by this agreement as a private dwelling unit for himself and/or his immediate family and for no other purpose." Article seven of the agreement provides that "[t]he Member hereby agrees not to assign this agreement nor to sublet his dwelling unit without the written consent of the Corporation."
Because articles five and seven of the agreement are seemingly contradictory — it is impossible both to sublet in accordance with article seven of the agreement and to use the premises as a private dwelling within the meaning of article five — the court must construe the articles in a manner that harmonizes all parts of the agreement. ( Kirschenbaum v. M-T-S Franchise Corp., 77 Misc 2d 1012, 1014 [Civ Ct, NY County 1974], quoting Levine v. Borenstein, 4 NY2d 241, 244.) Taken together, these articles require respondents to use the premises as their own — and their immediate families', if applicable — residence unless respondents get petitioner's approval to sublet. Thus, an illegal sublet necessarily violates articles five and seven because, by subletting, a tenant is allowing the premises to be used by a party other than the tenant and immediate family — in violation of article five — and is subletting without the landlord's permission — in violation of article seven. Therefore, the termination notices do not hamper respondents' ability to prepare a defense. Instead, the notices adequately apprize respondents what petitioner plans to prove at trial. ( See Sunset Park, NYLJ, Oct. 8, 1997, at 27, col 2.) Thus, although the petition alleges alternative grounds for proceeding against respondents, the grounds are consistent. They do not render the petition invalid.
Respondents allege that the termination notices are invalid because they afford respondents an opportunity to cure. A termination notice may not purport to terminate the tenancy while at the same time permit the tenant to cure. ( See Kimwall Realty v. De La Houssave, NYLJ, Feb. 8, 1990, at 23, col 3 [App Term 1st Dept, per curiam].) But a lease may provide for the terms of termination. And where, as here, a conditional limitation is involved, there must be strict compliance with the conditional limitation. ( Wuertz v. Cowne, 65 AD2d 528, 528-529 [1st Dept 1978, mem] [recognizing validity of cure provisions in leases]; Granet Const. Corp. v. Longo, 42 Misc 2d 798, 802 [Sup Ct, NY County 1964] [stating that terms of conditional limitation for lease termination must be strictly complied with].) The termination notice must also be clear and unequivocal. ( E.g. City of Buffalo Urban Renewal Agency v. Lane Bryant Queens, 90 AD2d 976, 977 [4th Dept], affd 59 NY2d 825.)
Article 13 of the agreement provides that if a term is violated, petitioner may "give to the Member a notice that this agreement will expire at a date not less than ten (10) days thereafter. If the Corporation so proceeds all of the Member's rights under this agreement will expire on the date so fixed in such notice, unless in the meantime the default has been cured in a manner deemed satisfactory to the Corporation." Thus, upon receiving the termination notice, a respondent has a mandatory 10-day period in which to cure before the occupancy agreement terminates. The termination notices provide that "if you fail to cure the above-mentioned default by October 31, 2002, that being at least ten (10) days after the service of this notice upon you, the term of your occupancy agreement shall expire, and you will be required to quit, vacate, and surrender possession of the above-stated premises."
It is possible to read article 13 of the agreement — the article governing premature termination of the agreement — as requiring petitioner to advise respondents of the right to cure in the termination notice. Further, HUD Handbook Section 4350.3 8-13 (B) (2) (c) (4) requires landlords to "[a]dvise the tenant that he/she has 10 days within which to discuss the termination of tenancy with the owner," in the termination notice. Thus, petitioner was attempting to comply with article 13 of the agreement as well as HUD requirements when petitioner advised respondents of the 10-day cure period. But even if the agreement does not require petitioner to advise respondents of the 10-day cure period to which each respondent is entitled, petitioner chose to apprize them of this right. Thus, petitioner might have been attempting to comply with article 13 of the agreement when it advised respondents of their right to cure in the termination notice. Petitioner should not be punished for advising a respondent of a mandatory right under the agreement, regardless whether petitioner was obligated to do so, and especially where it is possible to read the language of the agreement as requiring petitioner to inform respondent of a mandatory right. Thus, the termination notices conformed with the agreement and unambiguously informed respondents that their agreements would terminate if they failed to cure the alleged violations of the agreement. Therefore, the termination notices are not deficient.
During oral argument, the court inquired whether petitioner can submit any HUD rules that restrict respondents' occupancy of their respective premises as their primary residence. Petitioner stressed that the agreements given to respondents require them to occupy the premises as their private dwellings. Petitioner contended that the agreements' private-dwelling requirement is HUD's equivalent of restricting respondents' occupancy of the premises as their primary residence. Petitioner argued that if respondents were not maintaining the premises as their primary residence, it is entitled to recover possession from respondents.
According to petitioner, HUD Handbook 4350.3 3-5 D requires a resident of a HUD development to occupy the unit as "the family's only residence."
HUD Handbook Section 4350.3 3-10 A provides that:
"Assisted tenants must have only one residence and receive assistance only in that unit. This rule is meant to ensure that the government pays assistance on only one unit for a family and provides assistance to as many eligible families as possible with available funding."
HUD Handbook Section 4350.3 3-10 B, entitled "Sole Residence Requirement," provides that:
"1.A family is eligible for assistance only if the unit will be the family's only residence.
"2.The owner must not provide assistance to applicants who will maintain a residence in addition to the HUD-assisted unit."
Respondents argue that the HUD provisions pertain only to receiving assistance from the landlord and that the HUD handbook does not require them to use the premises as their primary residence. Respondents also argue that article seven of the agreement, which permits them to sublet with the landlord's permission, contradicts petitioner's assertion that HUD requires tenants to use their apartments as their primary residence. Respondent is correct. Nowhere do the HUD rules that petitioner provided the court condition a tenant's right to possess the premises on a tenant's use of the premises as primary residence. The HUD handbook conditions only the receipt of assistance by a tenant on a tenant's use of the premises as primary residence.
The HUD handbook specifically distinguishes termination of HUD rental assistance from termination of the tenancy. HUD Handbook Section 4350.3 8-1 D, an index for section 8 of the HUD handbook, is separated into one section governing termination of rental assistance and one section governing termination of tenancy. Moreover, HUD Handbook Section 4350.3 8-1 A provides that "[t]enants whose assistance is terminated may remain in the unit". The court has reviewed Section 8 of the HUD Handbook — the section governing termination of tenancy — and cannot find any provision requiring tenants to maintain the premises as their primary residence. Section 4350.3 3-10 B of the HUD handbook specifically conditions the receipt of rental assistance on maintaining the premises as primary residence. Section 4350.3 Figure 8-2 specifically lists the grounds to terminate a tenancy. Failuring to maintain the premises as primary residence is not among them. Therefore, if HUD wanted to condition the right of possession the premises as their primary residence, HUD would have stated as much in HUD Handbook Section 4350.3 Figure 8-2, just as HUD chose to do so in HUD Handbook Section 4350.3 3-10 B, which covers termination of rental assistance.
However, HUD does list "substantial lease violations" as a ground for terminating a tenancy in HUD Handbook Section 4350.3 Figure 8-2. Thus, petitioner can still prevail should petitioner prove that respondents are not using the premises as a private dwelling or that respondents are illegally subletting.
Because the HUD handbook does not provide guidance about the meaning of "private dwelling" as found in article five of the agreement, the term "private dwelling" must be defined by looking to the language of the agreement. As discussed above, article five of the agreement defines "private dwelling" as restricting the tenant's use of the property to use by the tenant and the tenant's immediate family.
Although neither party does so, it is possible to apply RPL § 235-f to the facts of this case. RPL § 235-f was enacted to protect tenants from unlawful occupancy restrictions in leases. RPL § 235-f (2) provides that it is "unlawful for a landlord to restrict occupancy of residential premises, by express lease term or otherwise, to a tenant or tenants or to such tenants and immediate family. Any such restriction in a lease * * * shall be unenforceable as against public policy." Where, as here, a clause in a lease purports to restrict the use of a premises to the tenant and the tenant's immediate family, a tenant may invoke RPL § 235-f (2) to void that lease clause. Because RPL § 235-f is meant to protect tenants from unlawful-use restrictions placed in form leases by landlords, only the tenant can raise RPL § 235-f; the landlord is not permitted to raise RPL § 235-f to void an unlawful-use restriction in a lease. ( See Mitchell Gardens No. 1 Cooperative Corp. v. Cataldo, 175 Misc 2d 493, 495 [App Term, 2nd Dept 1997, mem], quoting Barbizon Owners Corp. v. Chudick, 159 Misc 2d 1023, 1027 [Hous Pt, Civ Ct, Queens County 1994].) For RPL § 235-f to apply, the tenant must be using the premises in violation of the unlawful-use restriction. ( See id.)
A tenant who seeks the protection of RPL 235-f (2) must also comply with the other subdivisions of the statute. ( See Mitchell Gardens, 175 Misc 2d at 495 [stating that RPL 235-f § [2] may be used as a defense "only if all of the statute's criteria for occupancy are met, one of which is that the lessee or lessee's spouse must be occupying the premises as his or her primary residence"], quoting Barbizon, 159 Misc 2d at 1027.) RPL 235-f § (3) and (4) provide:
"3.Any lease or rental agreement for residential premises entered into by one tenant shall be construed to permit occupancy by the tenant, immediate family of the tenant, one additional occupant, and dependent children of the occupants provided that the tenant or the tenant's spouse occupies the premises as his primary residence. (Emphasis added.)
"4.Any lease or rental agreement for residential premises entered into by two or more tenants shall be construed to permit occupancy by tenants, immediate family of tenants, occupants and dependent children of occupants; provided that the total number of tenants and occupant, excluding occupants' dependent children, does not exceed the number of tenants specified in the current lease or rental agreement, and that at least one tenant or a tenant's spouse occupies the premises as his primary residence." (Emphasis added.)
Thus, if a tenant successfully voids an unlawful-use restriction under RPL § 235-f (2), and the tenant is allowing another occupant to reside in the premises, the tenants named in the lease or the tenant's spouse must be occupying the premises as their primary residence.
Article five of the agreement restricts occupancy of the premises to respondents and their immediate families. If petitioner shows that respondents are not using the premises in accordance with article five of the agreement, then, in response, respondents may choose to argue that the use restriction is invalid under RPL § 235-f (2). If respondents successfully argue that the occupancy restriction is void under RPL § 235-f (2), and if respondents are permitting another, unrelated occupant to use the premises — as will likely be the case if respondents are found to have violated article five of the agreement — then respondents must also show that either the named tenants or the tenant's spouse are using the premises as their primary residence.
The court is not applying RPL § 235-f sua sponte, and is not ruling on the validity or application of article five of the agreement at this time. The court notes only that RPL § 235-f might apply to the facts of this case and that respondents might be free to seek the protection of RPL § 235-f (2) if petitioner successfully shows that respondents violated article five of the agreement. But if respondents raise RPL § 235-f (2) to void article five of the agreement, and if respondents are permitting an unrelated, additional occupant to reside in the premises, then petitioner is permitted to argue that the tenants named in the agreement or the tenant's spouse is not using the premises as their primary residence, as required under RPL § 235-f (3) and (4).
Respondents move for summary judgment. Summary judgment should not be granted where there is any doubt as to the existence of a triable issue or where the issue is even arguable. ( See e.g. Simpson v. Term Industs., Inc., 126 AD2d 484, 487 [1st Dept 1987], citing Barrett v. Jacobs, 255 NY 520.)
The court first notes that the issue of primary residence is immaterial at this time because the HUD handbook does not require respondents to use their premises as primary residence. The issue of primary residence as to the named tenant or the named tenant's spouse will become relevant only if (1) petitioner can show that respondents are not using the premises as their private dwellings as defined in article five of the agreement; (2) respondents seek to void article five of the agreement under RPL § 235-f (2); and (3) respondents are permitting an additional occupant as defined in RPL § 235-f (3) or (4) to reside in the premises.
Petitioner argues that respondents are not using their apartments as "private dwellings" and that respondents are subletting their premises without petitioner's consent. Respondents deny that they are not using the premises as their private dwellings and that they are illegally subletting.
According to Debora Hassell-Dobies' June 3, 2003, affidavit in support, petitioner alleges that Roey Cohen, who is not named in the agreement and is not directly related to respondent within the meaning of article five of the agreement, has been seen coming and going from respondent Eyal Maor's residence. Petitioner alleges that Roey Cohen is illegally subletting from Maor. In Eyal Maor's July 21, 2003, affidavit in support of respondents' motion for summary judgment, admit that Roey Cohen has been to the premises, but alleges that Roey Cohen only visits on occasion and that Maor is not subletting. Maor also alleges that he does not use the premises for anything other than residential purposes and therefore is using the premises as his private dwelling. Petitioner further alleges that Eyal Maor maintains a separate residence, which respondent does not deny.
As to respondent David Kuliner, petitioner alleges that, according to an investigation, Mr. Kuliner maintains several residences throughout New York City and Connecticut and that Mr. Kuliner is subletting to Shay Zamir in violation of the agreement. Mr. Kuliner denies maintaining residences other than the subject premises, and alleges that the reason for any absences from the apartment is that his business often requires him to travel outside the country. Mr. Kuliner further alleges that Shay Zamir is his roommate, that he advised petitioner of that fact, and that he believes that he took on Mr. Zamir as his roommate in accordance with the agreement.
As to respondent Efrat Nizan, petitioner alleges that, according to an investigation, maintains a residence in Danbury, Connecticut. Respondent does not deny maintaining a separate residence. Petitioner further alleges that Nizan is illegally subletting to Rona Betinger and/or Shay Zaidenberg. Nizan does not deny subletting the apartment, but claims that she had petitioner's permission to do so. Nizan also provides a letter indicating petitioner's approval of her sublet request, marked as "Exhibit C" in her July 21, 2003, affidavit in support of respondent's motion for summary judgment. Petitioner alleges that there were several letters regarding the sublet, but all contained an approval conditional on board approval of the tenant and the submission of necessary paperwork. Finally, Nizan alleges that she cured within the 10-day cure period provided by the agreement.
Thus, there is a dispute about the facts necessary to determine each cause of action. Because there is a factual dispute, summary judgment is inappropriate at this time. Therefore, respondents' motion for summary judgment is denied.
Discovery should be granted where ample need exists. ( See Hartsdale Realty Co. v. Santos, 170 AD2d 260, 260 [1st Dept 1991, mem].) Whether respondents are subletting or whether they are not using the premises as their private dwellings is outside petitioner's knowledge. ( Cf. Zirinsky v. Violet Mills, Inc., 152 Misc 2d 538, 542 [Civ Ct, NY County, 1991] [denying discovery where respondents requested discovery and the relevant information was within the respondent's knowledge].) But whether respondents are subletting or whether respondents are using the premises as their private dwellings is within respondents' knowledge. Therefore, petitioner has shown ample need for discovery.
Petitioner's motion for discovery and to compel examination before trial for these three proceedings is granted. Respondents' motion for summary judgment is denied. Respondents are ordered to appear for examinations before trials to take place at both counsels' convenience no later then October 31, 2003. Respondents are to furnish petitioner with all documents requested by October 31, 2003. This matter is marked off calendar pending completion of discovery. Upon completion of discovery, this matter may be restored by stipulation or upon either side's motion.
This opinion is the court's decision and order.