Opinion
061018/2003.
Decided July 11, 2003.
Solomon Bernstein, New York City (Andrea Shapiro of counsel), for petitioner.
Estrin Benn, LLC, New York City (Melvyn Estrin of counsel), for respondent.
Recitation, as required by CPLR 2219 (a), of the papers considered in reviewing petitioner's motion.
Papers Numbered
Notice of Motion 1
Affirmation in Opposition 2
Reply Affirmation 3
This is a residential holdover proceeding in which petitioner, 1046 Amsterdam Avenue Housing Development Fund Corporation (HDFC), moves for a summary judgment seeking a monetary and possessory judgment against respondent, Adanelis Gomez, and for dismissal of respondent's counterclaims and affirmative defenses. Respondent raises five affirmative defenses and two counterclaims, including a request for declaratory judgment in the form of issuance of a stock certificate. The court grants petitioner's motion for summary judgment because there are no genuine issues of material fact and, after looking at the facts in the light most favorable to respondent, because judgment must be awarded to petitioner as a matter of law.
The 1046 Amsterdam Avenue building was originally owned by the City of New York. Respondent was an occupant of the premises in a month-to-month tenancy with petitioner's predecessor, the 1046 Amsterdam Avenue Tenants Association. During the city's ownership, respondent's tenancy was not subject to any type of rent regulation. (NYC Admin. Code § 26-504 [a] [1].) In June 1995, the building was sold to the HDFC and converted to a low-income cooperative, pursuant to a 1992 New York City-sponsored eviction offering plan. The HDFC is a corporation formed under Section 402 of the Business Corporation Law and Article XI of the Private Housing Finance Law. Units in the HDFC are not subject to rent regulation because cooperative corporations are nonprofit entities. ( 9 NYCRR § 2520.11 [j].) Respondent remained in occupancy and soon thereafter obtained Section 8 rental-assistance benefits. Respondent's tenancy became subject to a now-expired New York City Housing Authority (NYCHA) Section 8 lease commencing July 1, 2000, and terminating June 30, 2001. After the Section 8 lease expired, respondent stayed, without a lease, as a month-to-month tenant for an amount prescribed by the offering plan and applicable to nonpurchasers. A "[n]on-purchasing tenant [is a] person who has not purchased under the plan who is a tenant entitled to possession at the time the plan is declared effective * * * *" (GBL § 352-eeee [e].)
In March 2002, petitioner offered respondent a nonpurchaser's one-year lease, at an amount pre-approved by Section 8, which she refused to sign. Petitioner then terminated respondent's tenancy and served a thirty-day notice, pursuant to RPAPL 735.
Petitioner has elected to terminate respondent's lease because, it claims, she did not agree to pay the NYCHA Section-8 approved increased rent of $1000 per month. Petitioner sought and obtained approval from NYCHA for a new lease at $1000 per month, expiring June 30, 2003. Once Section 8 approval was obtained, petitioner offered respondent a written lease for $1000 per month. Respondent concedes that she did not sign the lease or pay the $1000. Petitioner contends, and respondent does not refute, that the $1000-a-month rental value is at or below fair market value.
Before the cooperative conversion, in September 1993, petitioner allegedly offered all the tenants in the building the right to subscribe to the offering plan. Respondent denies ever receiving such an offer, which petitioner claims was delivered under each tenants' door and posted in a visible location. Regardless, it is undisputed that in 1995 respondent became aware of the cooperative conversion and that she requested a stock certificate three times but was denied, her checks returned each time uncashed. On October 15, 1995, Gloria Torres, a manager of the HDFC, issued respondent a proprietary lease written on the same form used for shareholders. Petitioner avers that the use of this type of form, instead of a nonpurchaser's lease, was a mistake. Respondent contends that it is proof of ownership and a lease lasting until 2094. Even so, the proprietary lease was unaccompanied by a stock certificate that would certify respondent as a shareholder under the lease agreement. ( See Exhibit H to Petitioner's Notice of Motion.) Furthermore, the money allegedly offered for the stock certificate, $250, the minimum payment for a buying tenant, was tendered after the proprietary lease was issued and was never accepted by the HDFC. Respondent offers no proof of attempted tender, whether in the form of a money order or check, but for this motion the court accepts respondent's representation as true.
This decision covers all of respondent's counterclaims and defenses that arise from her interest in the premises. Respondent maintains she is a shareholder in the co-op because petitioner issued her a proprietary lease in the same form used for shareholders. This proprietary lease is not evidence of ownership; it was unaccompanied by a stock certificate and, as both sides agree, the attempted tender of $250 for the stock certificate occurred after the lease was signed. Because the $250 was never accepted, no transaction certifying respondent as a shareholder occurred. The record reveals that respondent does not have a stock certificate and that she paid the rent amount set for nonpurchasers as opposed to the maintenance amount for shareholders.
The undisputed facts reveal that respondent is not an official subscriber to the HDFC's cooperative plan because, eight years after the cooperative conversion, she still does not have a stock certificate. Whether she is entitled to a stock certificate is a matter for Supreme Court; it is an issue outside this court's subject-matter jurisdiction. ( Goldstein v. Stephens, 118 Misc 2d 614, 615 [App Term, 1st Dept 1983, per curiam] [finding that Civil Court lacks power to issue order to accept tenants' subscription agreement or to compel co-op to turn over shares of stock and proprietary lease].) Eighteen subscription agreements to the offering plan were executed in June 1995, and respondent does not possess one of them. Since the building was converted to cooperative status, respondent has paid the amount set forth in the offering plan for nonpurchasers and did not raise a claim of entitlement to subscribe until an increase in rent was sought in 2002. That is too late for a legal claim to be brought because "[a]ll bona fide tenants in occupancy on the date the plan is accepted for filing will have the exclusive right to subscribe to purchase the shares allocated to their dwelling units for ninety days after the plan is presented." ( 13 NYCRR § 18.3 [m] [1] [c] [i] [a].) Respondent did not execute a subscription agreement within the requisite period of time. Thus, the HDFC is not obligated to issue her a stock certificate.
In addition, the statute of limitations for any claim respondent might bring in Supreme Court has long expired. The commencement date for the statute of limitations is June 1995, when the HDFC denied respondent's request for a stock certificate. If the HDFC's rejection of the stock certificate was intentional, respondent's claim is barred because intentional tort claims have a one-year statute of limitations. (CPLR 215.) If the HDFC's rejection of the stock certificate was negligent, respondent's claim is still barred because negligence claims have a three-year statute of limitations. (CPLR 214.) If respondent claims that the failure to issue the stock certificate is a breach of a contract, this claim is also barred because contractual obligations must be filed within six years of the occurrence, in this case meaning no later than June 2001. (CPLR 213.)
Included in respondent's answer, in her third affirmative defense and counterclaim, is a request for a declaratory judgment, alleging that petitioner neglected to fulfill its obligations and responsibilities by failing to provide her with a stock certificate. In addition, respondent argues that petitioner failed to state a cause of action for eviction and that respondent has a lease agreement until June 2094, so that should she be removed from possession of the premises, she should be awarded a money judgment for the unit's fair market value. These affirmative defenses and counterclaim are procedurally barred and without merit. Thus, they are dismissed. Civil Court is one of limited jurisdiction. This court has no power to issue declaratory judgments or grant injunctive relief in the form of ordering a tenant to receive a stock certificate. ( Goldstein, 118 Misc 2d at 615.) Only Supreme Court has the jurisdiction to render the declaratory judgment respondent requests in this case. (CPLR 3001.)
Respondent, in her second affirmative defense, alleges that repairs need to be completed. For this defense is to be considered, further details are necessary to ascertain the elements of any abatement claim to assess the potentially decreased rental value due to impaired conditions. The premises were approved by Section 8 and valued at a fair market value of $1000 per month. But if repairs, such as plumbing, plastering, and painting, are needed, any judgment for use and occupancy might be affected. The fourth affirmative defense, that petitioner received full satisfaction for all rents due, is also one that my be asserted at a hearing. From letters received by the court dated July 8, 2003, which are not part of this pleading, it is unclear whether petitioner is owed rent from respondent. Section 8 approved the increased rental value of $1000, but respondent has not yet agreed to any rent increase. The court dismisses the first and fifth affirmative defenses for failure to state a cause of action and her assertion that the lease agreement will terminate in 2094. It is undisputed that respondent does not possess a stock certificate, that she was aware in 1995 of the denial to allow her to become a shareholder, and that the statute of limitations now proscribes these claims.
In its motion for summary judgment, petitioner asks for (1) a final judgment awarding possession of the premises to petitioner; (2) a warrant to remove respondent; (3) a judgment of fair value for use and occupancy; (4) interest; (5) and costs and disbursements of the proceeding, including attorney fees. A motion for summary judgment must be granted if the cause of action is established sufficiently to warrant the court as a matter of law to direct judgment in a litigant's favor. ( See generally CPLR 3212.) In this case, respondent has the burden of presenting evidentiary facts sufficient to raise a genuine issue of material fact. Because respondent has not produced evidence that she paid $250 as a shareholder or that the claim was brought within the statute of limitations, she has failed to raise any issues of material fact. Respondent is a simple month-to-month tenant.
Petitioner's motion for summary judgment in this holdover proceeding is granted because, even assuming that everything respondent alleges as true, she has not shown herself to be a subscriber to the offering plan, she was never issued a share certificate, and the statute of limitations bars her claims. Moreover, the fundamental reason for granting summary judgment is that the relief requested by respondent is outside this court's jurisdiction. Respondent's counterclaims are dismissed, and petitioner is entitled to a final judgment of possession, with the warrant to issue forthwith.
This case is adjourned until July 28, 2003 at 9:30 a.m. in Room 844 for a hearing on the second and fourth affirmative defenses to determine use and occupancy (minus an abatement, if any), legal fees, and until when the warrant of eviction will be stayed.
This opinion is the court's decision and order.