Opinion
Index No. 309595-23
12-14-2023
Laritza Mendez, Petitioner, v. Clara Hidalgo, MANUEL HIDALGO, ANTHONY HIDALGO, JANE DOE, JOHN DOE, Respondent.
Gerald Matthew Piggott, Esq. for the petitioner Manhattan Legal Services (Michael Y. Torres, Esq.), for the respondent
Gerald Matthew Piggott, Esq. for the petitioner
Manhattan Legal Services (Michael Y. Torres, Esq.), for the respondent
HON. KAREN MAY BACDAYAN JUDGE
Recitation, as required by CPLR 2219 (a) of the papers considered in review of this motion by NYSCEF Doc Nos: 9-18.
PROCEDURAL POSTURE AND BACKGROUND
This is a nonpayment proceeding commenced by Laritza Mendez ("petitioner"), the proprietary lessee of this Housing Fund Development Corporation cooperative unit, against respondents Clara Hidalgo, Manuel Hidalgo, and Anthony Hidalgo. Hereinafter, Clara Hidalgo is the only "respondent" to whom the court will refer. According to petitioner, "[r]espondents, Clara Hidalgo, Manuel Hidalgo and Anthony Hidalgo are petitioner's sub-tenants in the premises having entered into possession under a written lease agreement. By said agreement, respondents are liable to pay the landlord as rent/maintenance the sum of $1,210 each month[.]" (NYSCEF Doc No. 1, petition ¶ 2.)
Respondent has moved to dismiss the petition pursuant to CPLR 3212 on the basis that petitioner does not have a cause of action for nonpayment of rent "because no rental agreement was in effect at the time this proceeding was commenced." (NYSCEF Doc No. 10, respondent's attorney's affirmation ¶ 31.) Respondent also seeks summary judgment on the basis of the doctrine of tender and refusal, as respondent attempted to tender her rent in full for April 2022, and thereafter "save[d] all the monthly rent/maintenance payments" on the advice of her attorney. (Id. ¶¶ 15, 17.)
It is not disputed that respondent's first and only lease expired on December 31, 2020; nor is it disputed that after the lease expired, respondent continued to pay petitioner $1,210.00 per month, the rental amount preserved in the expired lease. Through March 2022, respondent's checks were accepted and cashed. On April 8, 2022, petitioner commenced a holdover proceeding against respondent predicated on a notice of termination purporting to terminate her tenancy as of March 31, 2022. (Mendez v Hidalgo, Index No. 304924-22.) In April 2022, by check dated April 3, 2022, during the period between expiration of the notice of termination and the commencement of the proceeding, respondent's regular payment was returned to her with a photocopy of the check marked "VOID" and a notation at the bottom that stated, "The deadline to vacate the premises was March 31 2[022]. Therefore, rent payments will no longer be accepted." (NYSCEF Doc No. 15, Hidalgo affidavit ¶¶ 11-12.) The holdover proceeding was ultimately dismissed in March 2023 for failure to plead the nature of the tenancy.
NY St Cts Elec Filing [NYSCEF] Doc No. 19, decision/order dated March 8, 2023, https://iapps.courts.state.ny.us/nyscef/CaseSearch [complete CAPTCHA, search by case index No. LT-304924-22/NY, click on index No. hyperlink].
Anticipating petitioner's opposition to the motion, respondent argues "the First Department does not require that the subject premises be rent stabilized or rent controlled in order to determine that a summary non-payment proceeding may not be maintained where there is no rental agreement in effect between the petitioner and respondent at the time the proceeding was commenced." (NYSCEF Doc No. 10, respondent's attorney's affirmation ¶ 34.) Respondent notes that none of the First Department cases she cites in support of her argument "condition the applicability of this doctrine of law on the regulatory status of the subject premises in question." (Id.)
Petitioner opposes respondent's motion on the basis that a month-to-month tenancy was formed after the expiration of the lease and that this agreement was in effect at the time that petitioner filed this nonpayment proceeding. Petitioner notes that respondent concedes that "each of the cases cited deals with rent stabilized apartments." (NYSCEF Doc No. 17, petitioner's attorney's affirmation ¶ 13.) However, petitioner advances that respondent's argument is specious because, while the cited cases involved rent stabilized tenancies, there was no analysis in those decisions regarding the application of the holdings to unregulated month-to-month tenants, to wit, "[n]one of the cases cited even mention non-rent stabilized units. In fact, if the courts had done so, it would have reversed long standing statutes and case law[.] (Id. ¶ 14.) Citing to Logan v Johnson, 34 A.D.3d 758 (2d Dept 2006), Bahamade v Grabel, 34 Misc.3d 58 (App Term, 2d Dept 2011), Trec v Cazares, 185 A.D.3d 866 (2d Dept 2020), and Carino v Mertens, 75 Misc.3d 1217 (A), 2022 Slip Op 50525 (U) (Sup. Ct., Duchess County 2022), petitioner argues that "it would be a reversible error for this Court to agree with respondents[.]" (Id. ¶ 17.) According to petitioner, "[t]he reason that respondent would like this Court to believe that the appellate courts do not differentiate between rent stabilized and non rent stabilized matters is because there is no case law that says non- rent stabilized apartments do not become month to month tenancies under the same terms of the prior lease agreement. In fact, every case on this matter states just the opposite (emphasis added)." (Id. ¶ 16.)
In reply, respondent points to two of the cases she cited in support of her motion where the tenancies were not subject to rent stabilization: 6 W. 20th St. Tenants Corp. v Dezertzov, 75 Misc.3d 135 (A), 2022 NY Slip Op 50529 (U) (App Term, 1st Dept 2022), which was a nonpayment proceeding by a cooperative corporation to recover "rent and other charges demanded in the petition" pursuant to a lease; and E. Harlem Pilot Block Bldg. IV HDFC Inc. v Diaz, 46 Misc.3d 150 (A), 2015 NY Slip Op 50289 (U) (App Term, 1st Dept 2015), involving a succession rights claim to a project-based Section 8 tenancy. (NSYCEF Doc No. 18, respondent's attorney's affirmation in reply ¶ 14.) Respondent further argues that there was no month-to-month tenancy created after petitioner ceased accepting rent from respondent when it commenced the holdover proceeding in March 2022. Notably, that proceeding was dismissed for failure to establish in the pleadings what kind of tenancy petitioner sought to terminate.
Diaz is not apropos as the apartment is subject to federal regulations.
Oral argument was held on December 5, 2023, and decision was reserved.
DISCUSSION
Can a Nonpayment Proceeding Be Commenced Against a Month-to-Month Tenant?
Real Property Actions and Proceedings Law ("RPAPL") provides that a nonpayment proceeding may be maintained against a tenant when:
"The tenant has defaulted in the payment of rent, pursuant to the agreement under which the premises are held, and a written demand of the rent has been made with at least fourteen days' notice requiring, in the alternative, the payment of the rent, or the possession of the premises, has been served upon [them] as prescribed in section seven hundred thirty-five of this article (emphasis added)." (RPAPL 711 (2).)
Real Property Law ("RPL") § 232-c provides as follows:
"Where a tenant whose term is longer than one month holds over after the expiration of such term, such holding over shall not give to the landlord the option to hold the tenant for a new term solely by virtue of the tenant's holding over. In the case of such a holding over by the tenant, the landlord may proceed, in any manner permitted by law, to remove the tenant, or, if the landlord shall accept rent for any period subsequent to the expiration of such term, then, unless an agreement either express or implied is made providing otherwise, the tenancy created by the acceptance of such rent shall be a tenancy from month to month commencing on the first day after the expiration of such term (emphasis added)."
Petitioner is correct that there is a dearth of controlling First Department law regarding nonpayment proceedings against month-to-month tenants who are not protected by any statutory or regulatory scheme. It seems that there is a quiet, implicit consensus among practitioners that such a proceeding is proper. However, as set forth below, such proceedings are not properly maintained after a landlord ceases to accept rent. Such is the law in the First Department.
The law in the First Department and Second Department appears to be settled that if a rent stabilized tenant's lease has expired and is not in effect at commencement of the proceeding, the proceeding will not lie. However, pursuant to the most recent Appellate Term, First Department case as written, it appears that the petition may be amendable to reflect unpaid rent that came due when the rent-stabilized lease had not yet expired. How this comports with the black letter law that a rent demand served pursuant to RPAPL 711 (2) is not amendable has yet to be determined. See 7 E 14, LLC v Libson, 81 Misc.3d 130 (A), 2023 NY Slip Op 51261 (U) (App Term, 1st 2023) ("To the extent the petition sought rent arrears accruing prior to [the lease expiration], we note that landlord never sought to amend the petition to correct the misstatement as to the terms of the prior lease and the amount owed thereunder. Moreover, landlord does not request that we reinstate the portion of the petition seeking rent through November 30, 2020. Instead, landlord requests that we reinstate the entire petition to correct a claimed 'anomaly in the law,' a request that we reject.") The court notes that this was not contemplated by the underlying decision that followed appellate law in the First Department, which requires that a lease be in effect at the time the proceeding is commenced. W. 152nd Assocs., L.P. v Gassama, 65 Misc.3d 155 (A) (App Term, 1st Dept 2019); Fairfield Beach 9th, LLC v Shepard-Neely, 77 Misc.3d 146 (A), 2022 NY Slip Op 51351 (U) (App Term, 2nd Dept 2022).
All four cases cited by petitioner are from courts in the judicial districts of the Second Department, two are from the Appellate Division, and, critically, none of the cited cases involves a summary proceeding pursuant to RPAPL 711 (2). Those cases ostensibly follow a rule different from that in the First Department.
In Logan v Johnson, 34 A.D.3d 758 (2d Dept 2006), the court found a month-to-month tenancy had initially been formed by the acceptance of rent after the expiration of the lease. This gave the plaintiff standing to sue for specific performance under the expired lease, the terms of which carried into the month-to-month tenancy and obligated respondent to pay rent" for as long as he remained in possession of the premises (emphasis added)." (Id. at 759.) The Appellate Division also held that the court below "did not err in awarding the defendant the sum of $1,500 per month for the 67-month period during which the plaintiff did not pay rent." (Id. [internal citation omitted].) In Trec v Cazares, 185 A.D.3d 866 (2d Dept 2020), the parties had agreed that rent under a lease was considered paid or waived in exchange for the plaintiff's services, and this arrangement "indicated that a month-to-month tenancy was created and was in effect for as long as [the tenant] remained in possession of the premises" under the same terms and conditions (emphasis added). (Trec, 185 A.D.3d at 867.)
However, in Jaroslow v Lehigh Valley R. Co., 23 N.Y.2d 991 (1969), the Court of Appeals opined that if no rent is accepted after the end of the lease term, then no month-to-month tenancy is created. (The contrapositive is also true: if there is a month-to-month tenancy, then rent was accepted after the end of the lease term.) The Jaroslow court held that "[an] action for nonpayment of rent, based on a notice purporting to fix a rent, never agreed upon by tenant and never paid by tenant, does not lie, there being no tenancy in fact or at law obligating the tenant for such rent." (Id. at 993.) The court further held, where no month-to-month tenancy is created by the payment of rent after expiration of the lease, "the landlord's remedy is limited to removal of the tenant and damages... for use and occupation." (Id.)
The Appellate Division, First Department caselaw discussing whether or not a month-to-month tenancy is created after expiration of the lease focuses primarily on holdover proceedings, not nonpayment proceedings pursuant to RPAPL 711 (2). In these cases the court was charged with parsing whether or not an option to renew the lease term existed under the lease, and, if so, whether or not the option was properly exercised during the lease term or during a month-to-month tenancy after expiration of the lease. These cases, discussed infra, recognize the possibility of creating a month-to-month tenancy, and distinguish such a tenancy from "an agreement either express or implied providing otherwise." The cases also lead to the determination that it is improper to maintain a nonpayment proceeding against an unregulated month-to-month tenant for rent not paid after the expiration of the tenancy at the end of the month, because "each month is a new term for a new period, each a separate and new contract (emphasis added, internal citations omitted)." (Bleecker St. Tenants Corp. v. Bleeker Jones LLC, 65 A.D.3d 240, 245-246 [1st Dept 2009], revd on other grounds 16 N.Y.3d 272 [2011].) As this is the law in the First Department, then when the month-to-month tenancy expires at the end of any given month, a new agreement is created only by paying rent on or about the first of the next month, and, if no rent is paid, there is no longer a valid contract under which to sue for past due rent.
The Court of Appeals has clarified that "the language in the statute 'unless an agreement either express or implied is made providing otherwise' refers only to extension of the duration of the holdover tenancy beyond a tenancy from month to month[.]" Jaroslow, 23 N.Y.2d at 993. One such example of "an agreement either express or implied,"discussed infra, is exercising an option to renew under an expiring or expired lease or lease term, including a term from month-to-month. See Bleecker St. Tenants Corp. v. Bleeker Jones LLC, 65 A.D.3d 240, 245-246 (1st Dept 2009), revd on other grounds 16 N.Y.3d 272 (2011).
Bleecker Jones involved a lease provision which allowed a lease renewal option to be exercised during the lease term and further provided that the tenant shall "remain in possession as a month-to-month tenant," until the landlord gave written notice of the option to renew, at which point the tenant would have 60 days to act. (Bleecker St. Tenants Corp., 65 A.D.3d at 242.) The Court of Appeals reversed the Appellate Division and held that as "the parties agree that, under these [lease] provisions, a renewal option could be exercised even after the original lease term had expired, during the [successive] month-to-month tenancies resulting from the absence of written notice" without violating the rule against perpetuities. (Bleecker St. Tenants Corp., 16 N.Y.3d at 275.) In other words, because each separate, month-to-month tenancy is a contract unto itself for which the original lease provided, it follows that exercising the lease option during a month in which the tenant had created a month-to-month tenancy as set forth in the lease, could satisfy the requirement that the option be exercisable during the lease term until after expiration of 60 days' written notice from the landlord that the tenant must exercise the option. (Id. at 278.)
The Bleecker Jones court noted that the lease options at issue were "not inconsistent with the purpose of the rule against perpetuities because they continue the tenant's possession of the property without interruption[.]" So long as the lease options existed (which they did until the landlord gave 60 days' notice and the tenant failed to act), "the tenant would remain a tenant, lawfully in possession of the property, at least on a month-to-month basis." Bleecker St. Tenants Corp., 16 N.Y.3d at 278.
In 120 Bay St. Realty Corp. v City of New York, 44 N.Y.2d 907 (1978) , a case with facts differing from Bleecker Jones but consistent therewith, the plaintiff's lease term had expired without the City's formal exercise of the lease renewal option, although the plaintiff continued in possession pursuant to the lease's holdover provision. (See 120 Bay St. Realty Corp., 59 A.D.2d 527, 528, [2d Dept 1977, Shapiro, J., dissenting], revd 44 N.Y.2d 907 [1978].) The Court of Appeals made a clear distinction between an extension of a lease term and an extension of a tenancy as a month-to-month tenant, observing that "defendant occupies the subject premises as a month-to-month tenant rather than as a tenant under a valid and existing lease (emphasis added)." (120 Bay St. Realty Corp., 44 N.Y.2d at 907.)
In N. Shore Cmty. Servs., Inc. v Cmty. Drive LLC, 120 A.D.3d 1142 (1st Dept 2014), referring again to the RPL 232-c language that a month-to-month tenancy is created at the expiration of a lease term "unless an agreement either express or implied is made providing otherwise," the court held that the lease which comprised certain language was "such an agreement." (N. Shore Cmty. Servs., Inc., 120 A.D.3d at 1143.) The lease specifically negated recognition of a month-to-month tenancy at lease expiration and provided that "upon plaintiff's default of its obligation to surrender the premises at the end of the lease term, plaintiff's continued occupation of the premises, with or without defendant's consent or acquiescence, will be treated as a tenancy at will and 'in no event' a tenancy from month to month." (Id.) Thus, plaintiff's argument that a month-to-month tenancy was created by the tender and acceptance of rent was refuted by the express language in the lease.
In 6 W. 20th St. Tenants Corp. v Dezertzov, 75 Misc.3d 135 (A), 2022 NY Slip Op 50529 (U) (App Term, 1st Dept 2022), cited by respondent, the court held, "[a]lthough the petition alleged the existence of a written lease between the parties, petitioner admitted at trial that it was not in possession of any proprietary lease, share certificate, transfer agreement or other direct evidence of any lease agreement with respondents[.]" (6 W. 20th St. Tenants Corp., 2022 NY Slip Op 50529 (U), *2.) The decision contains no analysis of month-to-month tenancies as, apparent from the trial court decision, the issue never arose. Petitioner attempted at trial to prove a lease agreement through circumstantial evidence which the trial court found to be "inconsistent" and "unreliable." (Id., *10.) In dismissing the proceeding, commenced pursuant to RPAPL 711 (2), for petitioner's failure to prove its prima facie case, the trial court cited to Stern v Equitable Trust Co. of NY, 238 NY 267, 269 (1924), for the proposition that "[t]he relation of landlord and tenant is always created by contract, express or implied, and will not be implied where the acts and conduct of the parties negative its existence (internal citation omitted)." (Id., * 2.) In affirming the decision, the Appellate Term noted that "[p]ursuant to RPAPL 711 (2), a nonpayment proceeding must be based on a default in the payment of rent pursuant to an agreement under which the premises are held (internal quotation marks omitted)," citing to 6 West 152nd Assoc., L.P. v Gassama, 65 Misc.3d 155 (A), 2019 NY Slip Op 51926 (U) (App Term, 1st Dept 2019). In Gassama, the Appellate Term noted at *1,
"The Court also properly rejected landlord's claim that tenant became a month-to-month tenant after the expiration of the November 2014 license agreement, since that document expressly indicated that "the rights of the Licensee shall not be deemed to be or construed as a month-to-month tenancy...." Moreover, even assuming that a month-to-month tenancy was created following expiration of the license agreement, there was no agreed rental amount for any month ensuing after tenant ceased paying rent (internal quotation marks omitted)."
In Krantz & Phillips, LLP v Sedaghati, 2003 NY Slip Op 50032 (U) (App Term, 1st Dept 2003), a proceeding commenced pursuant to RPAPL 711 (2), the Appellate Term, First Department affirmed dismissal of a nonpayment petition which sought rent for January 2022 and February 2022, but was premised upon a lease that expired October 31, 2021. The court held that "[e]ven assuming that a month-to-month tenancy was created following expiration of the lease, there was no agreed upon rental for any month ensuing after tenant ceased paying rent and no basis for holding tenant contractually liable for the rent reserved in the expired lease (internal citation omitted)." (Sedaghati, 2003 NY Slip Op 50032 (U), *1.) Citing to Jaroslow, the court noted the landlord could commence a holdover proceeding in which it could seek use and occupancy. (Id.)
Here, based on the foregoing cases, summary judgment should be granted in favor of respondent. The original lease, annexed to petitioner's affidavit in opposition, does not specify any agreement between the parties as to how to treat the tenancy once the lease expires. Absent "an agreement, express or implied," the issue becomes a question of law. The cases above make clear that a month-to-month tenancy is a contract from month to month which is renewed each month by the tender and acceptance of rent. Once the month for which a tenant tendered and the landlord accepted rent ends, the agreement must be renewed by another tender and acceptance of rent. Here, immediately after the lease expired respondent paid rent monthly at the beginning of the month from January 1, 2021 through March 2022, at which point respondent was notified in writing by petitioner that "rent payments will no longer be accepted." (NYSCEF Doc No. 15, Hidalgo affidavit ¶¶ 11-12; NYSCEF Doc No. 14, respondent's exhibit D, returned April 2022 maintenance check with note from petitioner.) Subsequently, petitioner sought to terminate respondent's license to occupy the apartment. No rent or use and occupancy was ever accepted or tendered after the rejection of respondent's offer of rent for April 2022. As no rent was subsequently paid, respondent has no obligation, express or implied, to pay rent for the months sought in the petition, all of which accrued commencing April 2022. Moreover, as noted in Dezertzov, "[t]he relation of landlord and tenant is always created by contract, express or implied, and will not be implied where the acts and conduct of the parties negative its existence (internal citation omitted)." (Dezertzov, 71 Misc.3d 1226 [A], 2021 NY Slip Op 50505 [U], *2 [Civ Ct, New York County 2021].)
Here, petitioner's efforts to terminate respondent's tenancy by a notice of termination served in December 2021, terminating respondent's tenancy as of March 31, 2022, and respondent's failure to offer rent from May 2022 to present, is negative to the existence of a contract. Finally, as with the holdover proceeding, and as in the court's March 8, 2023 decision/order dismissing that proceeding, supra, petitioner has vaguely pleaded the existence of a written lease but does not plead that it is no longer in effect, when it expired, or under what kind of tenancy respondent is now in possession upon which petitioner rests its cause of action. Even if petitioner had pleaded that respondent remained in possession under a month-to-month tenancy, such a statement is contradicted by the facts. Respondent has not offered and petitioner has not accepted an offer of rent since March 2022; thus, the last month that a month to month tenancy was in existence was March 2022, and that agreement has long expired.
Tender and Refusal
Respondent's attorney's claim that this it is a "fact" that respondent has enough monies saved to pay all rent at the monthly rental amount of $1,210 from April 2022 to present is supported only by respondent's self-serving declaration of same. (NYSCEF Doc No. 15, Hidalgo affidavit ¶¶ 13-14.) Moreover, notwithstanding the foregoing, respondent avers only to saving the money, not to actually offering to pay the full amount due each month. In addition, respondent's argument begs the question as to why she did not pay all the rent demanded in the 14-day notice in order to avoid this litigation altogether. Respondent's response made through her attorney is that the rent demand contradicted prior statements by the landlord stating that rent would no longer be accepted. (NYSCEF Doc No. 18, respondent's attorney's affirmation in reply ¶ 25.) Respondent has not eliminated any doubt as to her ability to claim tender and refusal. The cases cited by respondent involving a third party's tender are inapposite here. The other cases are distinguishable in that tenants therein repeatedly tendered the full amount due. Here, there is no proof of tender except for in April 2022. Respondent's motion for summary judgment founded upon the doctrine of tender and refusal is denied.
CONCLUSION
Accordingly, it is
ORDERED that respondent's motion for summary judgment founded upon the doctrine of tender and refusal is DENIED: and it is further
ORDERED that respondent's motion for summary judgment pursuant to CPLR 3212 is GRANTED for the reasons stated above without prejudice to commencement of an appropriate holdover proceeding.
This constitutes the decision and order of this court.