Opinion
L & T 26462/19
03-19-2020
COSTER 1 LLC, Petitioner, v. Ratamanegr ZEIDA, Respondent, John Doe and Jane Doe, Respondents-Undertenants.
For Petitioner: David L. Moss & Associates, 370 Lexington Avenue, Suite 2102, New York, NY 10017, (212) 566-6780 For Respondent: David S. Rosen, Esq., Bronx Legal Services, 369 East 148th Street, 2nd Floor, Bronx, NY 10455, (347) 592-2104
For Petitioner: David L. Moss & Associates, 370 Lexington Avenue, Suite 2102, New York, NY 10017, (212) 566-6780
For Respondent: David S. Rosen, Esq., Bronx Legal Services, 369 East 148th Street, 2nd Floor, Bronx, NY 10455, (347) 592-2104
Christel F. Garland, J.
Petitioner commenced this summary holdover proceeding on or about May 22, 2019, seeking to recover possession of Apartment No.3D, a rent stabilized apartment, located at 744 Coster Street, Bronx, New York, on the ground that Respondent Ratamanegr Zeida ("Respondent") refused to renew his expiring lease. Specifically, the notice of termination states that Respondent's existing lease was due to expire on February 28, 2019, and that on November 29, 2018 the building superintendent hand-delivered a renewal lease dated November 26, 2018 to Respondent.
Petitioner's Exhibit 4.
Respondent appeared by counsel and interposed an answer making objections in points of law as well as asserting several affirmative defenses and counterclaims.
When no resolution could be reached, the proceeding was transferred to the Expediter and referred to this part for trial.
At trial, David Tenenbaum testified in support of Petitioner's prima facie case. Mr. Tenenbaum testified that he is employed by Chestnut Holdings of New York where he manages the legal department and oversees the charging of rent, lease renewals, and anything that can find its way to court. In support of Petitioner's prima facie case, Petitioner introduced into evidence an attorney certified deed as evidence that Petitioner is the owner of the subject property, the registration rent roll from the Division of Housing and Community Renewal ("DHCR") to show that the apartment was properly registered with the agency, and the Court took judicial notice of the contents of the website of the Department of Housing Preservation and Development ("DHPD") which showed that the property is registered with the agency through September 2020. In addition, Mr. Tenenbaum testified that the last lease between the parties was a lease between Respondent and Petitioner's predecessor for a term that commenced on March 1, 2016 and ran through February 28, 2018 but that Respondent refused to sign the renewal lease subsequently offered to him . According to Mr. Tenenbaum, Respondent was offered a renewal lease sometime between 30 to 45 days prior to his last lease expiring which he recalled occurred before the end of 2018 because the last renewal was due to expire on March 1, 2019. Mr. Tenenbaum testified that a renewal dated November 26, 2018 was prepared and offered to Respondent, but that Respondent failed to execute it. However, Mr. Tenenbaum did not recall exactly when the lease was offered to Respondent other than that it was at least 90 days prior to the anticipated commencement of the renewal lease because Petitioner's practice is to send renewals between 90 to 110 days prior to the commencement of a lease term.
Petitioner's Exhibit 3.
On cross-examination, Mr. Tenenbaum testified that although the building superintendent delivered the renewal lease to Respondent, he is aware of the general window for when it was delivered based on management's usual practice with renewals.
In defense to the proceeding, Respondent testified that he has lived in the subject apartment since 2012 and signed an initial lease with a term which ran from March 1, 2012 through February 28, 2013. In addition, Respondent testified that he was not offered a lease in 2013 but continued to pay rent at the rate of $875 which Petitioner accepted and continued to accept despite not being offered a renewal lease in 2014 and 2015. Respondent acknowledged a renewal lease for a term which ran from March 1, 2016 through February 28, 2018 with a preferential monthly rent of $1,050, and testified that although he was not offered a renewal lease in 2018 he continued to pay the preferential monthly rent of $1,050 which Petitioner did not reject. Respondent testified that he had not been aware that Petitioner wanted to raise the rent until he received a telephone call from management informing him that he was paying less than the contract rent and that he would be sent a renewal lease with a higher rent. Respondent testified that he later received correspondence from Petitioner's attorney along with a renewal lease. However, the proposed rent was higher than he could afford and this litigation ensued.
Petitioner then called Mr. Tenenbaum as its rebuttal witness. Mr. Tenenbaum testified about how Petitioner calculated the monthly rent charged Respondent. Mr. Tenenbaum explained that to determine the rent amount Petitioner used the contract rent registered with DHCR and the last lease executed between Respondent and Petitioner's predecessor.
At the close of Petitioner's case, Respondent moved to dismiss the proceeding based on his argument that Petitioner failed to meet its burden to establish that a renewal lease was indeed offered Respondent and that the offer included an accurate calculation of the monthly rent.
Petitioner opposed the motion and argued that this Court took judicial notice of the court file which includes the facts surrounding when the renewal offer was made as provided in the notice of termination. In addition, Petitioner argued that the $875 was a preferential rent through 2016.
The Rent Stabilization Code ("RSC") provides for a ground for eviction where the tenant has refused, following notice pursuant to section 2523.5 of the RSC, to renew an expiring lease in the manner prescribed in such notice at the legal regulated rent authorized under the Code and the Rent Stabilization Law ("RSL"), and otherwise upon the same terms and conditions as the expiring lease (see RSC 2524.3 [f] ). Section 2523.5 (a) of the RSC further provides that on a form prescribed or a facsimile of such form approved by the DHCR, dated by the owner, every owner, other than an owner of hotel accommodations, shall notify the tenant named in the expiring lease not more than 150 days and not less than 90 days prior to the end of the tenant's lease term, by mail or personal delivery, of the expiration of the lease term, and offer to renew the lease or rental agreement at the legal regulated rent permitted for such renewal lease and otherwise on the same terms and conditions as the expiring lease. This section of the RSC also provides that upon failure of the owner to deliver a copy of the fully executed renewal lease form to the tenant within 30 days from the owner's receipt of such form signed by the tenant, such tenant shall not be deprived of any of his or her rights under the RSL and this Code and the owner shall be barred from commencing any action or proceeding against the tenant based upon nonrenewal lease.
It is Petitioner's burden to prove that an offer to renew Respondent's lease was made as required by the RSC. Essential to Petitioner's case under the stated ground for eviction is evidence that a renewal offer was made timely, and that the offer comports with the requirements of the RSC and includes an accurate calculation of the monthly rent.
Here, Petitioner's witness was unable to testify with certainty about when Petitioner notified Respondent of the expiration of his lease term and when it offered to renew the expiring lease. Notably, in its notice of termination Petitioner claims that it is the building superintendent who personally delivered the renewal lease to Respondent. However, the superintendent, who would provide the best evidence of that fact did not testify at trial. Mr. Tenenbaum's testimony is insufficient to establish that Respondent was timely notified and offered a renewal lease as he lacks the personal knowledge surrounding this crucial fact.
Notwithstanding the above, Petitioner's offer did not include an accurate calculation of the rent.
The evidence at trial established the existence of two leases, the initial lease with a term that began on March 1, 2012 and the renewal lease for the term which commenced on March 1, 2016. The initial lease ran from March 1, 2012 through February 28, 2013 and reserved a legal regulated monthly rent of $1,340.96 and a preferential rent of $875. Respondent testified that he continued to pay and Petitioner accepted the $875 until his most recent renewal when he began paying a monthly preferential rent of $1,050 . Respondent's testimony that he did not receive any leases from Petitioner between the period of the initial lease and the last renewal lease, and his testimony that he was charged and paid the preferential rents remained unrebutted.
Respondent's Exhibit A.
Petitioner's Exhibit 3.
Consequently, since the unrebutted evidence established that there were no leases in effect between the parties between March 1, 2013 and February 28, 2016, and Petitioner cannot deem leases renewed, the legal regulated rent reserved in the renewal lease executed by the parties in 2016 does not include a proper calculation of the legal regulated monthly rent which remained $1,340.96, the amount in the initial lease (see Samson Management, LLC v. Hubert , 92 A.D.3d 932, 939 N.Y.S.2d 138 [2nd Dept. 2012] ; see also Real Property Law § 232-c and 9 NYCRR § 2522.5 [b][2] ). By virtue of this incorrect calculation, the renewal lease Petitioner claims was offered Respondent sometime in 2018 prior to the commencement of this proceeding also included an incorrect calculation, and Respondent's refusal to execute this lease does not subject him to eviction. Had Petitioner been justified to deem the leases between March 1, 2013 and February 28, 2016 renewed, utilizing the legal regulated rent reserved in the initial lease between the parties and the Rent Guidelines Board increases since then, the stated regulated monthly rent is nevertheless incorrect .
See rent calculation chart.
Now with the passage of the Housing Stability and Tenant Protection Act of 2019 ("HSTPA"), section 26-511 (14) of the New York City Administrative Code was amended and provides that "any tenant who is subject to a lease on or after the effective date of a chapter of the laws of two thousand nineteen which amended this subdivision, or is or was entitled to receive a renewal or vacancy lease on or after such date, upon renewal of such lease, the amount of rent for such housing accommodation that may be charged and paid shall be no more than the rent charged to and paid by the tenant prior to that renewal, adjusted by the most recent applicable guidelines increases and any other increases authorized by law (emphasis added). DHCR issued a fact sheet which interprets this amendment to the Administrative Code and explains that tenants who were paying a preferential rent as of June 14, 2019, retain the preferential rent for the life of the tenancy (see DHCR Fact Sheet #40).
The HSTPA took effect on June 14, 2019. Although there was admittedly no lease in effect at the time the HSTPA became law, the evidence established that as a rent stabilized tenant Respondent was entitled to a renewal lease prior to the date the HSTPA took effect (emphasis added). Since Petitioner was unable to establish that a timely renewal offer was made, Petitioner is now required to offer a renewal lease to Respondent with a rent calculated as required by law which here is calculated utilizing the $1,050 preferential rent adjusted by the most recent applicable guideline increase as well as any other increases authorized by law as well as a correct calculation of the legal regulated amount as outlined in the attached calculation chart (see Administrative Code of City of NY § 26-511 [14] ).
Based on the foregoing, the petition is hereby dismissed. This constitutes the decision and order of this Court.
Renewal Permitted % Increase Period 6 1 YR 3/1/2012-2/28/20137 $1,340.96 3/1/2013-2/28/2014 2% OR $1,367.78 3/1/2014-2/28/2015 4% OR $1,422.50 3/1/2015-2/28/2016 1% OR $1,436.73 3/1/2016-2/28/2017 0% OR $1,436.73 3/1/2017-2/29/2018 0% OR $1,436.73 3/1/2018-2/28/2019 1.25% OR $1,454.69 3/1/2019-2/28/2020 1.5% OR $1,476.51 Renewal Permitted % Increase Period 2 YR 3/1/2012-2/28/20138 $1,340.96 3/1/2013-2/28/2015 4% OR $1,394.60 3/1/2015-2/28/2017 2.75% OR $1,432.95 3/1/2017-2/28/2019 2% OR $1,461.61 3/1/2019-2/28/2021 2.5% OR $1,498.15
[Editor’s Note: The preceding image contains the references for footnote , , ]
Calculations are made using the New York City Rent Guidelines Board ("RGB") Apartment Orders #44-51.
Initial vacancy lease.
Initial vacancy lease.
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