Opinion
2007-1947 S C.
Decided on November 19, 2008.
Appeal from a final judgment of the District Court of Suffolk County, Third District (C. Steven Hackeling, J.), entered September 10, 2007. The final judgment, after a nonjury trial, dismissed the petition in a nonpayment summary proceeding.
Final judgment reversed without costs, petition reinstated and matter remanded to the court below for entry of a final judgment awarding landlords possession and the principal sum of $53,653, and for calculation of the prejudgment interest due landlords.
PRESENT: RUDOLPH, P.J., McCABE and SCHEINKMAN, JJ.
In June 2000, the parties entered into a written agreement pursuant to which tenants had options to purchase the property, in which they lived, from landlords. After tenants failed to purchase the property, they remained in possession as month-to-month tenants at an agreed rent of $5,000 per month. In August 2006, landlords served tenants with a three-day notice to pay rent or quit, and landlords subsequently commenced this nonpayment summary proceeding to recover unpaid rent for the period from April 2005 through August 2006, plus interest. At trial, the parties agreed that the proceeding would encompass all rents owed for the 32-month period from January 1, 2005 through August 2007. It was uncontroverted that $160,000 was due for the 32-month period (prior to the application of any payments or credits), that tenants paid landlords $108,000 in 2004, and that, in 2006 and 2007, tenants paid landlords a total of $36,847 pursuant to court orders. The parties differ, among other things, as to how much of the $108,000 payment should be credited to the period commencing from January 1, 2005.
Following trial, the District Court found, inter alia, that the entire $108,000 should be applied to said period and awarded landlords the sum of $27,000, without prejudgment interest. After tenants paid $27,000 to landlords, a final judgment was entered dismissing the petition. The instant appeal by landlords ensued. On appeal, landlords contend, inter alia, that the District Court incorrectly calculated the arrears and that prejudgment interest should be awarded.
Pursuant to the 2000 agreement, tenants were due a credit of any monies received from the sale of a mortgage lien, which had been owned by tenant Ronald Johansen but assigned to landlords, against the base purchase price of the property. A review of the record indicates that landlords subsequently received $25,000 from the sale of the mortgage lien. Under the circumstances presented, we agree with the District Court that the 2000 agreement should be interpreted as providing for a credit in favor of tenants to be applied against rent.
Landlords contend that the District Court should have applied $30,500 of the $108,000 tenants paid in 2004 toward unpaid rent for the years 2002 and 2003. Indeed, landlords had so applied said sum, as well as $60,000 of the $108,000 in full payment of the 2004 rent, when they commenced this proceeding seeking $79,000 in unpaid rents from April 2005 to August 2006. At trial, Thomas J. Gillen testified that, after the payment was so applied, tenants were left with a $17,500 credit, for the period commencing on January 1, 2005, which constituted full payment for January through March 2005, and left due, for April 2005, a balance of $2,500. These calculations were reflected in the petition, which sought only $2,500 for April 2005 rent.
Tenants argue that the proof established that landlords are not owed any arrears for 2002 and 2003 since Gillen testified that the 2002 and 2003 rent notices that had been served, had been withdrawn. The petition clearly indicated what rent landlords sought, and, at trial, landlords provided clear and consistent testimony regarding their rent calculations. As the petition did not seek to recover any pre-2005 monies owed, landlords were not required to show that there were outstanding three-day notices for 2002 and 2003 ( cf. RPAPL 711; Matter of Salvatore Catherine Pepe v Miller Miller Consulting Actuaries, 221 AD2d 545). At no time during trial did tenants challenge the instant rent notice, and they presented no cogent testimony controverting landlords' assertions regarding the allocation of the monies, inasmuch as tenant Ronald Johansen's testimony as to the amount of monies tenants paid in 2002 and 2003 was unclear and indefinite. The only documentary evidence tenants provided as to rent paid consisted of checks for the 2006 and 2007 court-ordered payments. Consequently, we find that $30,500 of the $108,000 should have been credited against the pre-2004 arrears.
In view of the foregoing, we find that tenants owe landlords $53,653 in unpaid rent for the 32-month period, consisting of the $160,000 due for the period, less payments and credits of $36,847, $17,500, $25,000, and $27,000. Accordingly, the final judgment is reversed, the petition reinstated, and the matter remanded to the court below for entry of a final judgment awarding landlords possession and the principal sum of $53,653 and for calculation of the prejudgment interest due landlords ( see CPLR 5001 [a]; Solow v Wellner, 86 NY2d 582).
Rudolph, P.J., McCabe and Scheinkman, JJ., concur.