Opinion
108793/10.
Decided July 15, 2011.
David I. Paul, Esq., Rappaport, Hertz, Cherson Rosenthal, P.C., Forest Hills, NY, Attorney for Petitioner.
Teresita V. Magsino, Esq., Corporation Counsel, New York, NY, Attorney for Respondent.
Petitioner Mosholu Preservation Corp., the owner of the premises at 3447 Dekalb Avenue, Bronx, NY, commenced this Article 78 proceeding to reverse the decision by respondent Department of Housing Preservation and Development of the City of New York (HPD) embodied in a March 3, 2010 letter from Evelyn Ruiz, Director of HPD's Continued Occupancy Unit. In that letter, Ms. Ruiz confirmed HPD's decision to withhold from Mosholu Section 8 payments relating to Apartment 4B at the premises for the period from December 1, 2007 through April 23, 2009 totaling $14,886.88. According to the letter, the payments were withheld because the apartment had failed its Housing Quality Standards inspection on October 23 and November 21, 2007 and did not pass inspection until April 24, 2009.
Mosholu insists that it completed the necessary repair work before the November 21, 2007 inspection, that the apartment should have passed inspection on that date, and that it promptly provided ample documentation of that fact to HPD. According to Mosholu, if HPD was not satisfied with the documentation the managing agent had sent, it should have expeditiously scheduled another inspection in December 2007, instead of waiting nearly eighteen months until April 2009.
In sharp contrast, HPD insists that the November 21, 2007 inspection was properly conducted, that continuing conditions of disrepair were properly found on that date, and that the reinstatement of the Section 8 subsidy was properly denied. HPD further claims that it did not receive evidence of completed repairs from Mosholu, and that it promptly reinstated the subsidy on April 24, 2009 upon finding at the inspection the prior day that the conditions of disrepair had been corrected.
The parties' conflicting assertions require a detailed review of the facts and documentary evidence presented.
Background Facts
By notice dated October 25, 2007, HPD notified Mosholu that Apartment 4B had failed the Housing Quality Standards (HQS) inspection and that the owner was required to complete all necessary repairs before the November 21, 2007 reinspection date (Answer, Exh F). Attached to the notice was a copy of the inspection checklist, prepared by HPD Inspector Christopher Rivera, detailing the areas that had failed the inspection (Exh E). On November 21, 2007 the reinspection was conducted by HPD Inspector Antonio Williams. Williams found the exact same conditions of disrepair that Inspector Rivera had found the month before (Exh G). Because the apartment had failed the HQS inspection after an opportunity to complete repairs had been provided, the Section 8 subsidy was terminated effective December 1, 2007 (Exh H).
Mosholu has attached to its papers an e-mail suggesting that, the following week, it attempted to notify HPD that the repairs had been completed. Specifically, Mosholu has provided a printout of a December 6, 2007 e-mail from Crystal Moronta at the office of its managing agent Langsam Property Services Corp to "Carrol Dixon." The subject line of the e-mail is "Completed Repairs — Attached." The e-mail reads in its entirety as follows:
Please see the attached signed work orders. If you have any questions please call immediately.
Patricia Bothwell, 3447 Dekalb Avenue, No. 4B-Bronx, New York 10457
Thank you,
Crystal Moronta
Langsam Property Services Corp.
1601 Bronxdale Ave. Suite #201
Bronx, New York 10462
T 718 518 8000 ext. / F 718 518 8585
It is unclear exactly what, if anything, was attached to the e-mail. Further, Mosholu offers no evidence that Ms. Dixon at HPD received the e-mail or responded to it.
Mosholu next provides to the Court a series of e-mails from June 2008, six months after the initial e-mail was sent. The first in the series, dated June 11, 2008, is from Jose Ali at Langsam to Crystal Moronta at the same office stating; "Please check with Carol Dixon, Patricia Bothwell repairs were done 11/20/07, HPD said they went over and inspected on 12/07 and failed, in march 08 they recoup $$ going back to December, but we don't have any open work orders for this tenant."
What follows is an e-mail from Moronta to Dixon about 30 minutes later stating: "According to HPD, Patricia Bothwell's unit failed inspection in December 2007. We never received the failure notice. Can you please fax me the notice . . ." About an hour later, Dixon responded, advising Moronta to check her fax machine. Moronta replied later that day, acknowledging receipt of the notice.
The next day, June 12, 2008, Moronta sent another e-mail to Dixon indicating that she was attaching invoices and work orders signed by the tenant's daughter, which Moronta described as "obvious proof that we did the repairs in the unit." Dixon responded indicating that the e-mail had no attachment. Moronta sent another e-mail with the attachment at 3:08 p.m. Dixon did not acknowledge receipt. Nor is there evidence of any follow-up by Moronta.
The final e-mail provided is one from Jose Ali, also from Langsam, to Evelyn Ruiz at HPD. The e-mail is dated December 8, 2008, about six months after the last communication. Ali acknowledged that Apt. 4B had failed the HQS inspection in October 23, 2007, and he asserted that the repairs had been completed on November 20, 2007 and "HPD was notified on 12/6/07." He then indicated that the "check register for March 2008 shows the unit [has] been suspended retroactively to December 1st 2007 just several days after the work was done and the tenant had signed for it."
Ali made no mention in his e-mail of the November 21 inspection report, but he indicated instead that the agent had received notice from HPD in June 2008 that the conditions of disrepair found in October were still outstanding. He requested assistance from Ms. Ruiz in determining the status of matters, including the reason why HPD had scheduled a hearing for the tenant for July 23, 2008. He ended his e-mail with "P.S. I'm attaching the completed repair order sent on 12/6/08 to Carol Dixon." Ruiz did not acknowledge receipt of this e-mail. Nor is there evidence of any follow-up by Ali.
The postscript is presumably referring to the unacknowledged e-mail from Moronta to Dixon dated December 6, 2007, not 2008. The referenced "notice from HPD in June 2008" is presumably the copy of the notice terminating the Section 8 subsidy based on the failed November 21, 2007 inspection that Dixon sent to Moronta by e-mail in response to her June 2008 request.
The next series of communications consists of letters exchanged between Mosholu's counsel and HPD. The first is dated February 1, 2010, more than a year after the e-mail exchanges between HPD and the managing agent concluded (Exh 2). In the letter, addressed to Carrol Dixon at HPD, counsel indicated that he was applying on behalf of Mosholu for payment of the Section 8 subsidy relating to apartment 4B that had been withheld for the period from December 2007, after the second failed inspection, through April 2009, when the apartment passed inspection. He acknowledged that the apartment had failed inspection in October 2007, but claimed that proof of repairs had been sent to HPD in November and December 2007 and that "Ms. Dixon from HPD acknowledged receipt of the proof of repairs." He did not specify when or how that acknowledgment had allegedly occurred, and he offered no documentation to substantiate his claim.
Counsel further indicated in his letter that in March 2008, the owner had been notified that a hearing had been scheduled for the tenant in July 2008 based on an unrelated reason; that is, the tenant had purportedly vacated the apartment and left family behind without HPD permission. Counsel then reported that the managing agent had exchanged e-mails with Ms. Dixon in June 2008 regarding repairs. Then, in April 2009, the owner had received notice that the tenant's subsidy was being terminated effective May 31, 2009 because the tenant had vacated the premises, but the owner had still not heard about its request for reinstatement of the Section 8 subsidy in the intervening period based on the claimed completion of repairs.
Evelyn Ruiz from HPD responded to that letter on March 3, 2010 (Exh 1). Ruiz began by recounting the history, including the fact that the apartment had passed inspection on April 23, 2009 leading to the reinstatement of the subsidy the next day. Ms. Ruiz then asserted that HPD had not received proof of completed repairs before that time: "HPD's HQS Unit does not have a record of receiving any work orders from Langsam Management concerning the failure conditions observed on October 23, 2007 and November 21, 2007. If Langsam has evidence that work orders were submitted to HPD prior to April 24, 2009, they may fax them to Ms. Dixon's attention . . . and the documents will be reviewed."
On March 24, counsel for Mosholu replied by letter to Ms. Ruiz (Exh 5). He specifically acknowledged the October 23 and November 21 failed inspections, but insisted that the repairs had been done as of November 20, 2007, attaching various invoices and Langsam work orders signed by the tenant's daughter as purported proof. He further indicated that Mr. Ali and Ms. Moronta from Langsam had advised him that "Ms. Dixon had issues with the proof of repairs based upon an alleged inspection by Mr. Williams after the work was done by Langsam and that was the reason why the subsidy payments were not made retroactively." Counsel did not indicate when Ms. Dixon had purportedly advised the managing agent of this fact, but one can infer the following: Ms. Dixon did receive something from the managing agent at some point over the eighteen-month period at issue, but she advised the agent that the documents provided failed to rebut the findings of HPD Inspector Williams on November 21 that the repairs had not been satisfactorily completed.
The contractor invoices and Langsam work orders provided by counsel with the Ruiz letter are indeed unclear. Although two of the three invoices are dated November 20, 2007, they do not confirm that the work was completed as of that date but merely provide a list of repairs and the corresponding costs. The third invoice, dated December 7, 2007, certainly does not prove the work was completed in November. Further, all three invoices indicate that they were not paid until months later, in January or February of 2008. Similarly, some of the managing agent's corresponding computer printouts in fact state "work completed 02/12/2008." To the extent Mosholu claims that those documents were sent to Dixon in December 2007, the claim is belied by the fact that many of the documents bear notations with a 2008 date. In any event, Ms. Ruiz maintained HPD's position denying retroactive payment of the subsidy, and this Article 78 proceeding ensued.
Discussion
The governing federal regulations unequivocally bar HPD from making Section 8 payments on behalf of an apartment that is not in compliance with the Housing Quality Standards. See 24 CFR § 982.401 ff. When an apartment fails the HQS inspection, the owner is given 30 calendar days to correct the conditions of disrepair. 24 CFR § 982.404(a). The burden is on the owner to establish that the conditions have been corrected, just as the burden is on the owner here to establish that it was arbitrary and capricious for HPD to terminate the Section 8 subsidy in December 2007 and delay reinstatement until April 2009.
Mosholu has failed to meet its burden in this case. Wholly without merit is the owner's claim that the November 21, 2007 inspection was somehow fraudulent or faulty. In response to that claim, the Court at oral argument directed HPD to provide an affidavit from HPD Inspector Antonio Williams, who had conducted that November inspection. In his affidavit, sworn to on March 29, 2011, Williams confirmed that he has been the Supervisor of Mechanical Installations and Maintenance for the HQS Unit at HPD since August of 1987.
Inspector Williams further explained in his detailed affidavit the process for conducting an HQS inspection. For the reinspection conducted here on November 21, 2007, he inspected each and every item on the October checklist to determine whether it had been corrected, found failing conditions, and noted those failing conditions on his checklist. In addition, he prepared an Inspector Itinerary Report with handwritten observations. In that document, attached as Exhibit B to his affidavit, Williams noted that the apartment was "under construction." He concludes his affidavit by confirming the accuracy of his reinspection report and his finding that the apartment had failed the HQS inspection in November 2007, stating that "although corrective work may have begun, it was not completed on that date."
HPD has also provided an affidavit from Inspector Harry Hungria who conducted the April 24, 2009 inspection. Since the apartment passed inspection on that date and the subsidy was reinstated, no issue exists requiring a discussion of the affidavit.
Notwithstanding its protestations to the contrary, the owner has failed to rebut the validity of the inspection results. As indicated earlier, the invoices and work orders provided by Mosholu on their face are not dispositive as they do not indicate the date when the work was allegedly completed, and in some instances they suggest that it was completed after November 20, 2007. Ms. Moronta in her affidavit (at ¶ 11) states that the dates on some of the paperwork after November 2007 "do not refer to the work that was completed in the tenants's apartment, but to the internal workings of the agent." However, the fact remains that the work orders are not dispositive.
Nor is it persuasive that the tenant's daughter signed a pre-printed form presented by the managing agent on November 20, 2007. The form lists certain repairs and states at the bottom: "The above work has been completed to my satisfaction and there are no additional repairs or complaints at this time." Not only is the daughter's standing in question in light of the proceedings against the tenant for vacating the apartment without notice to HPD, but the daughter also signed the Inspection Report of Inspector Williams on the following day, which stated that the repairs had not been completed and the apartment was "under construction." Thus, the signature does not constitute proof that the repairs were completed.
At oral argument, the Court gave Mosholu leave to provide additional information directly from the contractors who had performed the work, which Mosholu did. The first document is an affidavit from Melvin Reynoso, an officer of Reynoso Maintenance Service Inc. He states that he received work orders from Langsam and completed work in Apt. 4B on November 20, 2007. He includes a list of the work performed, which is identical to the list in the two invoices previously provided by the owner. Those invoices are on Reynoso letterhead, are dated November 20, 2007, and list the specific repair items and corresponding cost for each. At the bottom of both work orders appear various initials and the date of February 11, 2008.
The Reynoso affidavit does little more than verify the authenticity of the invoices. Reynoso offers no independent recollection of the events, nor any independent corroborating documentation or information, such as a custom and practice with respect to the preparation of invoices in relation to the date he completes work. Thus, the affidavit is not persuasive evidence that the work was completed.
Mosholu has also provided an affidavit from Michael Ruane, the owner of Boyne Valley Hardwood Flooring. He states that on November 15 and 16, 2007 he removed vinyl tiles in the living room and bedroom and sanded and repaired the floors. His invoice is dated December 12, 2007 — a date six days after Ms. Moronta allegedly sent proof of repairs to Carrol Dixon at HPD — and bears initials at the bottom and a date of December 21, 2007. Thus, Ruane's affidavit is even less convincing than the Reynoso affidavit as to the claim that all work was completed on November 20, 2007.
The third affidavit is from Wendy Acevedo, the owner of Ace Cabinets and Appliances. She indicates that her company delivered a vanity on "November 14, 2011" to apartment 4B. The date presumably is a typographical error, as the attached invoice is dated November 14, 2007. This vanity was presumably installed at some point by Reynoso. Acevedo's statement regarding delivery does not constitute proof that the vanity was installed before the November 21, 2007 inspection.
Mosholu has also provided an affidavit from Crystal Moronta of Langsam confirming the authenticity of the e-mails attached to the owner's papers. She indicates that the three "work orders" she sent to HPD were, in fact, pre-printed forms completed by Langsam with a listing of repairs and a signature at the bottom by the tenant's daughter dated November 20, 2007 purportedly acknowledging that the listed repairs had been completed as of that date. As discussed above, those documents are unreliable and unpersuasive. Ms. Moronta does not indicate that she sent to HPD any of the invoices prepared by any of the contractors. She does explain, however, that the initials and dates written at the bottom of those invoices refer to dates when the agent confirmed the completion of the work and made payment. Her affidavit does little to support the owner's position.
In sum, even assuming the documents were received by HPD, they do not demonstrate that HPD acted in an arbitrary and capricious manner when it found on November 21, 2007 that, while work had begun, it had not yet been completed and conditions of disrepair remained. Thus, no basis exists to annul HPD's finding that the apartment had failed the HQS inspection, and the Section 8 subsidy was properly terminated based on that finding.
The next issue, urged with particular force in the supplemental affirmation from Mosholu's counsel and in the Moronta affidavit, is that HPD should not have delayed until April 2009 before conducting the reinspection. However, it is unclear exactly when HPD first received the owner's documentation, and the agent failed to follow up in a diligent manner. There are gaps of months and even years between the communications. At no point did the agent ever request a reinspection in writing, nor is there even a claim that one was requested orally. Further, it appears that Moronta only sent HPD Langsam's three work orders and nothing prepared by the contractors.
Accepting as true the statement in counsel's March 2010 letter that Carrol Dixon told the agent that the documents sent were insufficient in light of the November 21, 2007 failed inspection results, no date is attributed to that communication. Even more significantly, however, Mosholu offers no evidence that it ever sent to HPD additional documentation so as to persuade HPD that a reinspection was in order. When counsel finally sent additional documentation in the form of contractor invoices with his March 2010 letter formally applying for retroactive payments, HPD promptly scheduled a reinspection. One could certainly argue that HPD could have and perhaps should have scheduled a reinspection before April 2009. However, this Court cannot and does not find that HPD acted in an arbitrary and capricious manner by not scheduling an earlier inspection, particularly considering that the owner had failed to provide competent, convincing proof that all necessary repairs had been completed.
Accordingly, it is hereby
ADJUDGED that the petition is denied and this Article 78 proceeding is dismissed.