Opinion
No. 2022-51132
11-10-2022
Cascade Funding Rmi Alternative Holdings LLC, Petitioner, v. Elizabeth Giannetto AS TRUSTEE OF THE ELIZABETH GIANETTO LIVING TRUST DATED MARCH 14, 2003; JASON KANNRY, "JOHN DOE" and "JANE DOE," Respondent(s).
Counsel for Petitioner: Kimberly Mulligan, Esq. of Robertson, Anschutz, Schneid, Crane & Partners, PLLC Counsel for Respondents: James G. Dibbini, Esq. of James G. Dibbini & Associates, P.C.
Unpublished Opinion
Counsel for Petitioner: Kimberly Mulligan, Esq. of Robertson, Anschutz, Schneid, Crane & Partners, PLLC
Counsel for Respondents: James G. Dibbini, Esq. of James G. Dibbini & Associates, P.C.
Jodi J. Kimmel, J.
Margaret Bober and Eva Rem, admittedly appearing in this proceeding as Respondents on behalf of Jane Doe 1 and Jane Doe 2, have moved to dismiss the Petition prior to answering same.
BACKGROUND
On May 9, 2004, Elizabeth Giannetto, landlord, and Margaret Bober, tenant, entered into a month-to-month lease for the premises located at 4 Old Cross River Road, Katonah, NY ("the Premises"). Ms. Bober has been residing at the Premises since May 2004. Eva Rem is Ms. Bober's mother and claims to be living at the Premises but gives no indication of when she moved in. A Judgment of Foreclosure and Sale was entered on August 22, 2019. A foreclosure sale was conducted on November 20, 2019. Petitioner was the successful bidder at the sale, and a Referee's Deed was executed on December 17, 2019.
Petitioner claims in their Affirmation in Opposition that a Notice to Quit/Vacate was served on December 16, 2021. They attach an affidavit of service that shows this December date. However, Petitioner does not attach a copy of the notice that was allegedly served on December 16, 2021. Petitioner filed a Notice of Petition and Petition - Holdover with this Court on March 24, 2022 ("the Holdover Petition"). Attached to that Petition is a copy of a Notice to Vacate dated November 18, 2021. The Notice to Vacate is addressed to the same parties listed in the caption of this proceeding.
The first page of the Notice to Vacate is titled "Ten (10) Day Notice to Vacate". The Notice provides that the recipient(s) of the Notice either produce evidence that they are entitled to the protections of Real Property Actions and Proceedings Law ("RPAPL") § 1305 or they are required to vacate the Premises within 10 days of service of the notice, that date being handwritten into the notice as February 12, 2022 (said date comporting with service that would have been completed on February 2, 2022).
The second page of the Notice to Vacate has two sections. The first section is titled "Notice of Foreclosure & Tenant's Rights Under New York RPAPL § 1305". This section informs the recipient of the Notice, inter alia, that RPAPL § 1305 grants certain rights to occupants who are tenants, including "the giving of 90-day Notice to Vacate or the right to remain until your lease expires...." Again, demand is made that the recipient of the notice "provide evidence to show that the occupant is entitled to the protection of New York RPAPL § 1305."
The second section on the second page is titled "Alternative Ninety (90) Day Notice". Here, the recipient of the Notice is purportedly given "the Ninety (90) Day Notice to Vacate as required by New York law (for tenants)." The Notice continues, "Pursuant to New York RPAPL §1305, all tenants must vacate the property by May 3, 2022", the date, again, being filled in by hand with the date comporting with service that would have been completed on February 2, 2022. In point of fact, an affidavit of service indicating that service was completed on February 2, 2022, is annexed to the Notice to Vacate.
In view of the foregoing, the Court is constrained to disregard Petitioner's allegation that an undisclosed Notice to Vacate was served on December 16, 2021, in favor of the Notice that was served on February 2, 2022, said Notice being attached to the Petition filed with the Court.
As noted above, neither Ms. Bober nor Ms. Rem is specifically named in the Notice to Vacate. Similarly, they are not specifically named in the Holdover Petition.
Ms. Bober appeared in court on the initial return date and requested an adjournment to retain counsel. Counsel has appeared in this proceeding on behalf of Ms. Bober and Ms. Rem and moved this Court to dismiss the Holdover Petition contending that the Notice to Vacate is defective because it contains alternative periods within which to vacate; the Petition was served prematurely; and Petitioner failed to join necessary parties to this proceeding.
Both Respondents submitted affidavits with their motion. As noted above, in her affidavit, Margaret Bober states that she entered into a written month-to-month lease for the Premises with Elizabeth Giannetto. She attaches a copy of the lease. The monthly rent payable by the tenant to the landlord was established at $1,500. Ms. Bober also asserts that she has lived at the Premises since she signed her lease; her driver's license lists the Premises as her address; and she receives mail there. Eva Rem states in her affidavit that she is Ms. Bober's mother; she resides at the Premises with Ms. Bober (although she does not state when she moved in); and that "[a]t one point in time as part of a tenancy agreement with the prior owner, Elizabeth Giannetto, [she] paid in excess of $50,000 for property taxes and use and occupancy at the subject property" (no date of payment or proof of payment was given).
As will be addressed herein, while the Respondents are presently represented by the same attorney and they have put forward the same arguments, it is clear to the Court that the rights and claims of Ms. Bober and Ms. Rem are incongruous.
Procedural Irregularities
As a prefatory matter, the Court is constrained to address the deficiency of the movants' application. Civil Practice Law and Rule ("CPLR") § 2214(a) spells out the requirements for creating a Notice of Motion - the time and place of the hearing; relief sought; etc. must be included in this notice. A "motion" can be dismissed if proper notice of the motion is not given. Glass Capital Ventures v Abdul-Malik, 2019 NY Misc. LEXIS 11293 (Sup Ct, Queens County 2019).
Furthermore, the Holdover Petition was not annexed to the Respondents' papers rendering the motion procedurally deficient pursuant to CPLR § 2214(c). It is axiomatic that this Court is unable to determine whether the Petitioner's Petition is legally sufficient so as to withstand dismissal without a copy of the actual pleading before it. See generally, Alizio v Perpignano, 225 A.D.2d 723 (2d Dept 1996); Thompson v Iannucci, 50 Misc.3d 1226(A), 2015 NY Slip Op 51984(U) (Sup Ct, Ulster County 2015).
The foregoing having been stated, this Court will not dismiss the motion because of a procedural defect as the delay would ultimately prejudice the Petitioner.
Any future motions filed without the required Notice of Motion will be rejected by this Court.
Conclusions of Law
The Validity of the Notice to Vacate
In their motion to dismiss, the Respondents contend that a combined 10-day and 90-day notice to vacate "is not legally recognized", however there is a plethora of case law that speaks to the contrary. See e.g., Wilmington Trust, N.A. v Holmes, 68 Misc.3d 1220 (A), 2020 NY Slip Op 51033(U) (Civ Ct, Queens County 2020). It is not unreasonable for a buyer at foreclosure to cast a wide net in a Notice to Vacate so as to cover all possible types of occupants since they will not likely have precise knowledge of who is residing in the house and their legal relationship, if any, to the Premises. The Court finds that the combined 10-day/90-day Notice to Vacate is not defective because it makes provision for alternate dates by which the occupant(s) must vacate the Premises.
Respondents also take issue with the fact that the Notice to Vacate purportedly required them to prove they were tenants by supplying evidence of their status to the Petitioner, without which, they would be required to vacate the Premises within ten (10) days of receipt of the Notice to Vacate. Respondents, citing Bank of Am., N.A. v Owens, 28 Misc.3d 328, 2010 NY Slip Op 20164 (City Ct, Rochester County 2010), argue that the Protecting Tenants at Foreclosure Act ("PTFA") provides protections for tenants and the Petitioner cannot impose additional obligations that are not provided in the statute. This Court concurs. In accordance with the PTFA there is no obligation for the Respondents to respond to a questionnaire and prove tenant status.
That said, the question remains: Are the Respondents "tenants" pursuant to RPAPL § 1305 and/or the PTFA?
Status as "Tenant" and Timeliness of Petition
The protections of both RPAPL § 1305 and the PTFA are available to protect tenants of foreclosed properties in New York. See e.g. 956 Rogers Ave NDB LLC v Blair, 67 Misc.3d 403, 2020 NY Slip Op 20047 (Civ Ct, Kings County 2020).
Under the PTFA, a person is a" bona fide tenant" if: (1) neither the mortgagor nor his family member is the tenant; and (2) the tenancy was the result of an arm's length transaction; and (3) the monthly rent (unless it is subsidized rent) is not substantially less than the property's fair market value. PTFA § 702(b). The PTFA provides that all" bona fide tenants" residing in foreclosed residential real property are entitled to at least 90 days' advance notice of their obligation to vacate the premises before they can be evicted. (See PTFA § 702 [a]).
The definition of "tenant" contained in RPAPL § 1305 is as follows:
"Tenant" shall mean any person who appears as a lessee on a lease of one or more dwelling units of a residential real property that is subordinate to the mortgage on such residential real property; or who at such time is a party to an oral or implied rental agreement with the mortgagor and obligated to pay rent to the mortgagor or such mortgagor's representative, for the use or occupancy of one or more dwelling units of a residential real property.
As Ms. Bober has established that she is a lessee pursuant to a lease entered into with the prior mortgagor, she meets the definition of tenant pursuant to RPAPL § 1305(1)(c). Whereas Ms. Bober has a month-to-month lease, pursuant to RPAPL § 1305(2), she shall have the right to remain in occupancy of the Premises for a period of 90 days from the date of the service a notice to vacate.
Having established that she is a tenant and afforded 90 days after service of the predicate notice within which to vacate, the Petition with respect to Ms. Bober must be dismissed, without prejudice, as same was filed on March 24, 2022 - prior to the expiration of the 90-day period which ended on May 3, 2022.
Contrary to Petitioner's argument, whereas Ms. Bober is a tenant entitled to the protections of RPAPL § 1305, it matters not whether here tenancy was the result of an arm's length transaction as that requirement solely pertains to the PTFA which provides the same 90-day advance notice. Similarly, while Petitioner did not present credible evidence of the fair market rent of the Premises (an alleged printout from a website [Zillow] purporting to assign value to the Premises is not evidence and does not establish the fair market rent), again, the amount of the rent is a factor pertaining to the application of the PTFA. The only relevance fair market rent has to RPAPL § 1305 is where a tenant seeks to extend her occupancy for the remainder of the lease term. In that case, for a lease to qualify under RPAPL § 1305, such lease must require the payment of rent "not substantially less than the fair market rent for the unit". In this case, the lease is a month-to-month lease and Respondent cannot extend her occupancy for longer than 90 days after service of the notice to vacate. Accordingly, the fair market rent is inapplicable.
Finally, on this point, Petitioner contends:
[P]ursuant to RPAPL § 1305 (2), a tenant is afforded the protections of remaining in the premises the greater of 90 days or the remainder of the lease term, provided that such tenancy continues under the same terms and conditions as were in effect at the time of the entry of the judgment of foreclosure and sale or transfer of title. [Emphasis in the original].
Petitioner concludes that Respondents' "failure to continue submitting rental payments is a breach under the Rental Agreement and therefore Respondents would not be entitled to the protections provided under RPAPL § 1305."
Petitioner's conclusion has no merit. RPAPL § 1305 (2) provides, inter alia, that "a tenant... shall continue such tenancy... under the same terms and conditions as were in effect at the time of the entry of the judgment of foreclosure and sale...." Ignoring the fact that Petitioner has failed to present any credible evidence with the respect to the issue of what rent, if any, has been paid, the statute does not necessarily condition a tenant's right to remain in occupancy upon payment of rent. The statute simply provides that the parties are to continue to operate under the terms of the original lease during the tenant's period of continued occupancy. Whether or not Ms. Bober has defaulted in connection with her obligations under the lease is not at issue here.
With respect to Ms. Rem, based upon a review of the Record the Court finds that she is not a tenant, and she is not entitled to the protections of RPAPL § 1305 or the PTFA. The written lease between the owner/landlord, Elizabeth Giannetto, and the tenant, Ms. Bober, expressly limits occupancy of the Premises to Ms. Bober and her minor children. Ms. Rem's vague reference to "a tenancy agreement" she had with Ms. Giannetto is unavailing. Ms. Rem failed to inform with respect to the terms of the purported tenancy agreement; she failed to allege that she paid rent; and while claiming that she paid "in excess of $50,000 for property taxes and use and occupancy", she failed to provide any details or proof with respect to the payment. Ms. Rem has not credibly alleged that she came into possession of the Premises as a result of an arm's length transaction. Indeed, Ms. Rem has even failed to state when she came to reside at the Premises. In view of the foregoing, Ms. Rem is not a tenant, and she is not entitled to the protections of RPAPL § 1305 or the PTFA.
Notwithstanding that Ms. Rem is not entitled to the protections of RPAPL § 1305 or the PTFA, the instant proceeding may not be maintained solely against Ms. Rem for the reasons set forth below.
Necessary Joinder and Identification of Parties
Respondents claim that the Petition must be dismissed because they were not specifically named in the Petition and, it follows, joined as necessary parties. Pursuant to CPLR § 1024, "[a] party who is ignorant, in whole or in part, of the name or identity of a person who may properly be made a party, may proceed against such person as an unknown party by designating so much of his name and identity as is known." A party can only resort to CPLR § 1024, however, if the party has exercised due diligence in trying to ascertain the names of the occupants of the subject premises. "A diligent effort to learn the party's name is a condition precedent to the use of CPLR §1024, which should therefore be turned to only as a last resort." George Tut & Company v Jane Doe, 20 Misc.3d 815, 2008 NY Slip Op 28264 (Civ Ct, Kings County 2008); Siegel, NY Prac. §188 at 304 (3d ed). "If a petitioner knows a party's name, or fails to demonstrate that diligent efforts were made to learn a party's name, then use of a fictitious name is not authorized by CPLR 1024 and the petition is rendered fatally defective as to that party." Pinnacle Bronx East v Bowery Residents Comm., Inc., 2006 NY Misc. LEXIS 4025, 235 NYLJ 60 (Civ Ct, Bronx County 2006), citing Triborough Bridge and Tunnel Auth. v Wimpfheimer, 165 Misc.2d 584 (App Term, 1st Dept 1995); First Fed. Sav. & Loan Ass'n v Souto, 158 Misc.2d 219 (Civ Ct, NY County 1993).
In this case, it does not appear as though the Petitioner made any effort to establish who lives at the Premises. Petitioner named two individuals who apparently do not live at the Premises and failed to name the two people who do live there. To show that they have performed a diligent inquiry, counsel would be required to submit an affidavit stating that a diligent inquiry has been made to determine the names of such parties. Netherland Props, LLC v Karalesis, 63 Misc.3d 1235 (A), 2019 NY Slip Op 50896(U) (Civ Ct, Bronx County 2019); see also, Chavez v Nevell Mgmt Co, 69 Misc.2d 718 (Civil Ct, NY County 1972); 2 Weinstein-Korn-Miller, NY Civ Prac, para 1024.04. Here, the Petitioner has failed to allege that they made any inquiry.
Cognizant that the Petition is subject to dismissal as to Ms. Bober because it was filed before Ms. Bober was required to vacate the Premises, the Petition would also be subject to dismissal based upon Petitioner's reliance on CPLR § 1024 without establishing that they undertook a diligent effort to learn her name before giving her a fictious name in the Petition.
The conclusion with respect to Ms. Rem is different, however, because she is not a "necessary party" in the proceeding. The definition of "necessary party" found in CPLR § 1001(a) is: "[p]ersons who ought to be parties if complete relief is to be accorded between the persons who are parties to the action or who might be inequitably affected by a judgment in the action...." It appears the only connection that Ms. Rem has to the Premises is that she was invited to live there by her daughter, the tenant, Ms. Bober. It follows, any rights Ms. Rem has to occupy the Premises flow directly from her daughter and would terminate upon her daughter's eviction. As the mother of the tenant, Ms. Rem is not a "necessary party" and does not need to be named in the proceeding nor served with process and the 10-day notice provision of RPAPL § 713 is inapposite. 170 West 85th Street Tenants Ass'n. v Cruz, 173 A.D.2d 338, 339-340 (1st Dept 1991).
The fact that Ms. Rem is not a "necessary party", however, does not mean is she is not a "proper party" and, in point of fact, "[t]he Appellate Division has stated that the constitutional right to due process requires that 'for [a warrant of eviction] to be effective against a subtenant, licensee or occupant, he be made a party to the proceeding, either by naming him in and serving him with the petition and notice of petition or by joining him as a party during the pendency of the proceeding'". Parkash 2125 LLC v Galan, 61 Misc.3d 502, 2018 NY Slip Op 28273 (Civ Ct, Bronx County 2018) citing 170 West 85th Street Tenants Ass'n., 173 A.D.2d at 339-340.
Nevertheless, while it has been held that assigning a fictious name to an occupant is legally sufficient to give her notice of the proceeding (170 West 85th Street Tenants Ass'n, id.), and while there is no question that Ms. Rem has, in fact, received notice of the proceeding (she has appeared in the proceeding by counsel), Petitioner cannot maintain the holdover proceeding against an occupant alone where, as here, the Premises is also occupied by a tenant. 170 West 85th Street Tenants Ass'n., 173 A.D.2d at 339; Triborough Bridge and Tunnel Auth v Wimpfheimer, 165 Misc.2d 584.
Finally on this point, where, as here, a necessary party (Ms. Bober) is required to be served with a predicate notice, the same rules with respect to the naming of necessary parties in the caption of the petition apply to the predicate notice. Where the Notice to Vacate contained the same improper caption as the Petition, Petitioner having failed to exercise due diligence in trying to ascertain the names of the occupants of the Premises before attempting to resort to CPLR § 1024, the Notice to Vacate, just like the Petition, is fatally flawed and not subject to amendment. First Fed. Sav. & Loan Ass'n, 158 Misc.2d at 221 citing Chinatown Apts. v Chu Cho Lam, 51 N.Y.2d 786 (1980).
CONCLUSION
It is the conclusion of this Court that the Petition must be dismissed, without prejudice. The Court finds that Margaret Bober is a tenant and entitled to a new and corrected 90-day notice. Petitioner may be advised to sue every occupant that it wishes to evict.
Upon consideration of the history of these proceedings, the Court directs that service of the Notice to Vacate upon Respondents' counsel, by hand or overnight delivery with a copy to the Respondent(s) via first-class mail, will be sufficient service of the Notice to Vacate.
SO ORDERED.