Opinion
L & T 84355/13.
06-05-2015
RIVERSTONE ASSOCIATES, LP, Petitioner, v. Avril CAMPBELL, Respondent.
Gutman Mintz Baker & Sonnenfeldt, PC by Young Yoo, Esq., New Hyde Park. Legal Services NYC Brooklyn Branch by Karen May Bacdayan, Esq., Brooklyn.
Gutman Mintz Baker & Sonnenfeldt, PC by Young Yoo, Esq., New Hyde Park.
Legal Services NYC Brooklyn Branch by Karen May Bacdayan, Esq., Brooklyn.
SUSAN F. AVERY, J.
In this nonpayment proceeding petitioner moves for leave to reargue the decision and order of this court dated January 21, 2015, and upon granting reargument, denying respondent's motion for summary judgment and permitting the petitioner to pursue its claim for market rent from the respondent. Respondent opposes the motion.
BRIEF FACTUAL HISTORY
The respondent is a recipient of an HUD (section 8) rental subsidy for which she must annually re-certify her household income and composition. The submission of her annual re-certification must be timely, which according to HUD rules, must be completed by the recipient's anniversary date. Respondent's anniversary date is October 1. Petitioner asserts that respondent filed her re-certification documents on October 16 (2013) and the documents submitted, falsely claimed that her son was enrolled as a college student. Upon its investigation, petitioner learned that the respondent's son was not enrolled as a student in college. Respondent subsequently submitted accurate certification information in February of 2014.
Housing and Urban Development.
According to the petition verified on August 1, 2013, the apartment in which respondent resides "is subject to the section 8 Housing Assistance Program for projects with HUD–insured and HUD–Held mortgages pursuant to 24 CFR Part 886, subpart A" ¶ 7.
Affidavit of Property Manager, Eli Davidowitz, sworn to on March 4, 2015, ¶ 8.
Affidavit of Property Manager, Eli Davidowitz, sworn to on March 4, 2015, ¶¶ 8 & 9.
Affidavit of Property Manager, Eli Davidowitz, sworn to on March 4, 2015, ¶¶ 8 & 9.
BRIEF PROCEDURAL HISTORY
Petitioner commenced this nonpayment proceeding seeking rent as follows: balance of $96.00 for the month of March of 2013, and $505.00 per month for the months of April through August of 2013. The petition is dated August 1, 2013. A default judgment was entered against the respondent, which was vacated by this court on January 23, 2014.
In his affidavit in support, Mr. Davidowitz states: "[t]his nonpayment proceeding was commenced due to the [r]espondent's failure to pay market rent due to her failure to timely re[-]certify pursuant to HUD guidelines" Affidavit of Property Manager, Eli Davidowitz, sworn to on March 4, 2015, ¶ 6. However, the petition, which is dated August 1, 2013, predates respondent's anniversary date of October 1, 2013, by more than two (2) months before respondent's became delinquent in her re-certification.
During the course of this proceeding, counsel for the respondent was granted leave to file an amended answer containing the defense, that the respondent's re-certification should be processed retroactively; and the petition has been amended to reflect additional rental charges as they became due.
Counsel for the respondent previously moved for partial summary judgment which was denied as premature. Thereafter, respondent commenced a subsequent motion for summary judgment, which was granted by this court. It is from this later decision that petitioner seeks reargument.
"Although landlord previously moved for summary judgment ... and successive summary judgment motions are generally disfavored (see Jones v. 636 Holding Corp., 73 A.D.3d 409, 899 N.Y.S.2d 605 (1st Dept. [2010] ), the court was not precluded from addressing the merits of the underlying motion (see Giardina v. Lippes, 77 A.D.3d 1290, 1291, 909 N.Y.S.2d 602 (4th Dept. [2010] ), lv. denied 16 N.Y.3d 702 ( [2011] )" Rand v. Bedford Hotel, Inc., 47 Misc.3d 146(A), 2015 WL 2261315 (App.Term 1st Dept. [2015] ).
DECISION AND ORDER DATED JANUARY 21, 2015
Respondent's prior motion for partial summary judgment, sought an order striking that portion of petitioner's claim for the market rent, which was granted by this court. It was undisputed that the respondent has been re-certified since February of 2014 , and petitioner failed to demonstrate that it followed proper procedures when inquiring and determining the existence or non-existence of "circumstances beyond the respondent's control" which prevented the respondent from timely filing her HUD re-certification. As HUD requires the petitioner to make an inquiry as to whether circumstances beyond the tenant's control existed, and to notify the respondent of its decision and of the right to appeal a negative determination, in it's prior determination, this court severed petitioner's claims for market rent.
Affidavit of Property Manager, Eli Davidowitz, sworn to on March 4, 2015, ¶ 10; see also, Affidavit of Ms. Avril Campbell, sworn to on March 10, 2015, ¶ 14.
PETITIONER'S ARGUMENTS
Petitioner contends that this court improperly applied the facts and the HUD regulations in determining that the petitioner is not entitled to collect market rent, in this summary proceeding, for the period of respondent's non-compliance. Petitioner asserts that the court mistakenly concluded that the respondent's submission of false documentation in support of her 2014 annual re-certification qualifies as an "extenuating circumstance" pursuant to the HUD Handbook. Petitioner asserts that the examples of "extenuating circumstances" as illustrated in the HUD handbook include hospitalization, family emergency or military duty, "none of which are akin to the circumstances herein ..."
See HUD Handbook at Chapter 7–8(d)(4).
Affirmation of Arianna Gonzalez–Abreau, Esq., dated March 4, 2015 at ¶ 25.
It is petitioner's contention, that "there is no basis under the HUD regulations for a finding that the respondent's representation that her son was a student, when in fact he was not a student, qualifies as ‘extenuating circumstances' [because] she was not aware that he[r son] was not in school [at that time]." Petitioner argues that the respondent's submission of such false and inaccurate information is fraudulent. Petitioner asserts that to allow retroactive re-certification under these circumstances would encourage further fraud by tenants.
Affirmation of Arianna Gonzalez–Abreau, Esq., in support dated March 4, 2015 at ¶¶ 5 and 25.
Affirmation of Arianna Gonzalez–Abreau, Esq., in support dated March 4, 2015 at ¶ 25; see also, Affidavit of Property Manager, Eli Davidowitz, sworn to on March 4, 2015, ¶ 13.
In addition, petitioner states that despite having been provided with all the required HUD re-certification notices the respondent did not timely re-certify, and when she did re-certify she provided incorrect information.
RESPONDENT'S ARGUMENTS
It is respondent's contention, that this court correctly decided it's prior motion for partial summary judgment. Respondent maintains that petitioner is prohibited from maintaining this nonpayment proceeding against respondent seeking market rate rent, as she has currently re-certified. Respondent also contends, as a secondary argument, in its prior motion for partial summary judgement, that petitioner failed to comply with the HUD requirements regarding inquiring as to whether extenuating circumstances prevented Ms. Campbell from timely re-certifying. Additionally, respondent asserts that the petitioner failed to follow the HUD handbook, in that petitioner did not consider whether extenuating circumstances prevented Ms. Campbell from timely re-certifying, and did not provide a written determination of it's decision that extenuating circumstances did not exist, or notice that the respondent may appeal petitioner's finding that extenuating circumstances did not exist.
LEGAL REQUIREMENTS: MOTION TO REARGUE
"A motion to reargue is based on no new proof; it seeks to convince the court that it was wrong and ought to change its mind." Leave to reargue is left to the sound discretion of the court, and that discretion includes considering a motion to reargue, even where the movant failed to annex the papers that had been submitted on the motion from which reargument is sought. In the interest of justice, this court exercises its discretion and grants petitioner leave to reargue.
Siegal, New York Practice, Motion Practice, Chapter 10. § 254, Motion to Reargue or Renew (2015).
Fosdick v. Town of Hempstead, 126 N.Y. 651, 27 N.E. 382 ( [1891] ).
"Although plaintiff neglected to attach all of the papers that had been submitted on the preceding motions, the court had discretion to consider the motion to reargue, and to excuse procedural deficiencies" Sachar v. Columbia Pictures Indus., Inc., 129 A.D.3d 420, 11 N.Y.S.3d 35 (App.Div. 1st Dept. [2015) citing to HSBC Bank USA, N.A. v. Halls, 98 A.D.3d 718, 950 N.Y.S.2d 172 (2d Dept. [2012] ) ; and CPLR § 2001.
APPLICABLE HUD RULES
Eligibility for HUD assistance is based on household income, and "[c]hanges in income or family composition can affect the amount of assistance a tenant is eligible to receive and, therefore, the amount the tenant pays for rent." In order "[t]o ensure that assisted tenants pay rents commensurate with their ability to pay, HUD requires ... re[-]certification of family income and composition at least annually. [Landlords] must then recompute the tenants rent and assistance payments ... based upon information gathered." The
HUD Handbook at Chapter 7–1A.
HUD Handbook at Chapter 7–4A(1).
"[a]nnual re[-]certification must be completed by the tenant's re[-]certification anniversary date" which "is the first day of the month in which the tenant moved into the property."
HUD Handbook at Chapter 7–5A.
HUD Handbook at Chapter 7–1B.
By "the 10th day of the 11th month after the last re[-]certification ... the tenant must contact the owner and provide the required information ... to process the re[-]certification." Where, the "tenant ... provides [required] information ... after the 10th day of the 11th month following the last annual re[-]certification ..." the certification process is delayed. And where the "[t]enant responds after the re[-]certification anniversary date [the t]enant is ‘out of compliance’ [with HUD requirements ... and as of the] re[-]certification anniversary date, the tenant must begin paying the market rent."
HUD Handbook at Chapter 7–6(a)(2).
HUD Handbook at Chapter 7–8D(2)(a)(2).
HUD Handbook at Chapter 7–8D(3).
HUD Handbook at Chapter 7–8D(3)(b).
"When a tenant fails to [timely re-certify] an owner must inquire whether extenuating circumstances prevent[ed] the tenant from [timely re-certifying] ..." This inquiry is required to be made "[a]t the time the tenant submits the required re[-]certification information" and "[i]f the tenant indicates that extenuating circumstances were present, the tenant must promptly provide the owner with evidence of their presence." The owner must then "[d]etermine whether extenuating circumstances were present" and "provide the tenant with a written notice of the decision ... [which] must ... inform the tenant of his/her right to appeal the ... decision.
HUD Handbook at Chapter 7–8D(4).
HUD Handbook at Chapter 7–8D(4)(b)(1).
HUD Handbook at Chapter 7–8D(4)(b)(2).
HUD Handbook at Chapter 7–8D(4)(b)(2)(c).
HUD Handbook at Chapter 7–8D(4)(d).
Extenuating circumstances "are circumstances beyond the tenant's control." Examples of extenuating circumstances include: "[h]ospitalization of the tenant," where the "[t]enant is out of town for a family emergency ( [because of] the death or severe illness of a close family member)," and where the "[t]enant [is] on military duty overseas."
HUD Handbook at Chapter 7–8D(4)(a).
HUD Handbook at Chapter 7–8D(4)(a)(1).
HUD Handbook at Chapter 7–8D(4)(a)(2).
HUD Handbook at Chapter 7–8D(4)(a)(3).
Notwithstanding that a tenant untimely re-certified and "extenuating circumstances" were not found to exist, the "owner may not evict the tenant for failure to pay market rent after the tenant reports for [re-certification] ..." And, "if the tenant fails to report for ... re [-]certification ... and fails to pay market rent, or make arrangements to pay, the owner is obligated to evict for non payment."
HUD Handbook at Chapter 7–8D(3)(d)(f).
HUD Handbook at Chapter 7–8D(3)(d).
ISSUE BEFORE THE COURT
It is undisputed that, the respondent herein, failed to timely appear for her re-certification interview, failed to timely submit necessary re-certification documents and when she did appear for her re-certification interview and submitted required documentation, the items she submitted claimed that her son, with whom she lived, was a college student, when, in fact, he was not. Additionally, it is undisputed, that as a result of Ms. Campbell's claim that her son was a college student, the amount of rent she was required to pay was reduced.
It is respondent's contention that the HUD rules and regulations prohibit the petitioner from maintaining the instant eviction proceeding seeking the market rent, because respondent is currently re-certified, and it is petitioner's contention that it is obligated, and authorized, by the HUD rules to maintain this proceeding, seeking market rent.
As a result, this court was called upon to determine if the HUD rules and regulations authorize the landlord to maintain the instant summary nonpayment proceeding, seeking possessory relief, based upon the non payment of market rent, where a tenant untimely re-certified her HUD § 8 subsidy and made a false statement on her re-certification application.
ANALYSIS OF THE HUD RULES TO THE FACTS AT BAR
In a case remarkably similar to the matter at bar, (when sitting as a Judge in Civil Court), Associate Justice of the Appellate Division, Rolando T. Acosta, held that "[g]iven the unmistakable mandate[s] of the HUD Handbook (citation omitted ) .... [the] petitioner was required to retroactively apply respondent's subsidy following her concededly past-due re[-]certification."
Accepted for Miscellaneous Reports Publication
East Harlem Pilot Block Building 1 HDFC v. Cordero, 196 Misc.2d 36, 763 N.Y.S.2d 203 (Civ.Ct. N.Y. County [2003] ).
Additionally, Judge Acosta held that "[s]hould a tenant fail to [timely] re [-]certify ... the owner may require the tenant to pay ‘market rent’ .... [and] ... may continue to charge the tenant market rent until [the tenant] submits all of the documents necessary for re[-]certification."
Id.
Moreover, Judge Acosta ruled that, "[n]otwithstanding petitioner's contentions to the contrary, petitioner does not have the ‘discretion’ ‘not to reinstate the subsidy retroactively’ " Accordingly, Judge Acosta "grant[ed] the motion for partial summary judgement in favor of respondent and .... dismisse [d] petitioner's claims for the HUD subsidy portion of respondent's alleged arrears ..."
Id., (emphasis added).
Id.
Additionally, petitioner in the instant proceeding, is incorrect in it's contention, that maintaining this nonpayment summary proceeding against the respondent, seeking market rent, is proper because the HUD Handbook states that "if the tenant fails to report for ... re[-]certification ... and fails to pay market rent, or make arrangements to pay, the owner is obligated to evict for non payment." As ruled by Justice Acosta, notwithstanding a finding "[t]hat no-extenuating circumstance [existed, the petitioner was] not relieve[d] ... of its mandatory obligation to retroactively implement the subsidy upon respondent's late re[-]certification. "
HUD Handbook at Chapter 7–8D(3)(d).
East Harlem Pilot Block Building 1 HDFC v. Cordero, id., (emphasis added).
The court notes that the law firm that represented petitioner in East Harlem Pilot Block, supra, is the same law firm that represents the petitioner in the instant proceeding. Accordingly, this court deems petitioner's motion, and petitioner's previously submitted opposition to respondent's prior motion, as the assertion of petitioner's good faith belief that the law should be changed. However, since it is the legislature that enacted the statutes regulating HUD subsidies, any change to such statutes is within the sole province of the legislature and beyond the jurisdiction of this court.
Petitioner even cited East Harlem Pilot Program, supra, in it's submission, see Affirmation of Arianna Gonzalez–Abreau, Esq., dated March 4, 2015 at ¶ 34.
Costanza v. Seinfeld, 181 Misc.2d 562, 693 N.Y.S.2d 897 (Sup.Ct.N.Y. County [1999] ), where "... there is no genuine basis either in law or fact, or good faith argument for a change in the law [the position is frivolous]."
"There is a strong presumption that legislative enactments are constitutional (see Montgomery v. Daniels, 38 N.Y.2d 41, 378 N.Y.S.2d 1, 340 N.E.2d 444 [1975] ), and a party contending otherwise bears the heavy burden of showing that a statute is so unrelated to the achievement of any combination of legitimate purposes' as to be irrational (Affronti [v. Crosson], 95 N.Y.2d 713 [723 N.Y.S.2d 757, 746 N.E.2d 1049] ( [2001] )quoting Kimel v. Florida Bd. of Regents, 528 U.S. 62, 120 S.Ct. 631, 145 L.Ed.2d 522 ( [2000] )" People v. Novie, 41 Misc.3d 63, 976 N.Y.S.2d 636 (App.Term 2nd Dept. 9th & 10th Jud.Dist. [2013] ).
Indeed, "..respect for the basic policy of separation of powers and the proper exercise of judicial restraint we will not intrude into the ... affairs of the Legislature" Heimbach v. State of New York, 59 N.Y.2d 891, 893, 465 N.Y.S.2d 936, 452 N.E.2d 1264 [1983]appeal dismissed 464 U.S. 956, 104 S.Ct. 386, 78 L.Ed.2d 331 ( [1983] ).
EXTENUATING CIRCUMSTANCES
As stated above, where "a tenant fails to [timely re-certify] an owner must inquire whether extenuating circumstances prevent[ed] the tenant from [timely re-certifying] ..." This inquiry is required to be made "[a]t the time the tenant submits the required re[-]certification information" and "[i]f the tenant indicates that extenuating circumstances were present, the tenant must promptly provide the owner with evidence of their presence." The owner must then "[d]etermine whether extenuating circumstances were present" and "provide the tenant with a written notice of the decision ... [which] must ... inform the tenant of his/her right to appeal the ... decision.
HUD Handbook at Chapter 7–8D(4).
HUD Handbook at Chapter 7–8D(4)(b)(1).
HUD Handbook at Chapter 7–8D(4)(b)(2).
HUD Handbook at Chapter 7–8D(4)(b)(2)(c).
HUD Handbook at Chapter 7–8D(4)(d).
To demonstrate it's compliance with HUD rules, petitioner states "when a tenant does not timely re[-]certify, the HUD handbook requires a determination as to whether extenuating circumstances are present. The Landlord made the necessary determination in this case that the Respondent's [situation] does not qualify as an ‘extenuating circumstance’ under the HUD handbook and therefore did not excuse her untimely re[-]certification." Indeed, as argued by petitioner, there was no contention that Ms. Campbell was hospitalized, out of town for a family emergency or on military duty overseas.
Affidavit of Property Manager, Eli Davidowitz, sworn to on March 4, 2015, ¶ 12.
HUD Handbook at Chapter 7–8D(4)(a)(1).
HUD Handbook at Chapter 7–8D(4)(a)(2).
HUD Handbook at Chapter 7–8D(4)(a)(3).
However, petitioner failed to present proof in evidentiary form that, upon submission of Ms. Campbell's late re-certification, petitioner inquired as to whether extenuating circumstances prevented her from timely re-certifying. Petitioner also failed to demonstrate that the petitioner provided Ms. Campbell with written notice of it's determination that extenuating circumstances did not exist; and petitioner failed to demonstrate that along with the written notice to Ms. Campbell of petitioner's determination that extenuating circumstances did not prevent her from timely re-certifying, that Ms. Campbell was informed of her right to appeal such a negative determination.
In support of her prior summary judgment motion, and in opposition to the instant motion, respondent asserts that, that she was not provided with proper notice that an inquiry was to be made as to whether exigent circumstances existed. She also stated that she was not provided notice that the petitioner determined that exigent circumstances did not exist, nor provided notice in writing that she had the right to appeal petitioner's determination that exigent circumstances did not exist. Accordingly, the burden shifted to the petitioner to offer proof in evidentiary form to rebut the respondent's sworn allegations.
Affidavit of Ms. Avril Campbell, sworn to on March 10, 2015, ¶ 15, see also, Affidavit of Ms. Avril Campbell, in support of the respondent's motion for partial summary judgment, sworn to on November 14, 2014, ¶ 15.
Once the initial showing has been made, the burden shifts to the party opposing the motion for summary judgment to rebut the prima facie showing by producing evidentiary proof in admissible form sufficient to require a trial of material issues of fact" Highbridge House Ogden LLC v. Highbridge Entities LLC, 48 Misc.3d 976, 16 N.Y.S.3d 669 (Sup.Ct.N.Y. County [2015] )citing to Kaufman v. Silver, 90 N.Y.2d 204, 659 N.Y.S.2d 250, 681 N.E.2d 417 [1997] ).
Petitioner failed to rebut respondent's sworn denial of receipt of proper HUD notices. Indeed, in it's motion to reargue petitioner fails to annex any notices sent to the tenant informing her of her right to have an inquiry made as to whether exigent circumstances existed which prevented her from timely re-certificating. Petitioner fails to annex written notice to the respondent of the petitioner's determination that exigent circumstances were not present, nor does petitioner annex notice to respondent of her right to appeal such a determination. Moreover, petitioner failed to deny respondent's allegations or annex supporting documentation in opposition to respondent's motion for summary judgment, or in it's current motion to reargue. Accordingly, petitioner failed to demonstrate, that petitioner complied with HUD requirements, or that this court misapplied the law to the facts herein presented.
It is clear, as petitioner asserts that the "HUD Handbook sets out the procedures that must be followed both by owners and by tenants seeking to complete the annual re[-]certification." Indeed, because the notice provisions of the HUD handbook are mandatory, they must be strictly adhered to. As a result, the issue before the court was not whether the respondent's circumstances fell within the definition of "extenuating circumstances," rather, the issue was petitioner's compliance with the HUD notice requirements.
Affirmation of Arianna Gonzalez–Abreau, Esq., dated March 4, 2015 at ¶ 34, citing East Harlem Pilot Program, supra.
"Petitioner may not maintain a nonpayment proceeding based upon a suspension of a section 8 subsidy where the notices for re [-]certification do not comply with the requirements of the HUD Handbook" East Harlem Pilot Block Building 1 HDFC v. Cordero, id., (citations omitted).
DETERMINATION
Based upon the foregoing, upon reargument, this court adheres to its original determination. CONCLUSION
The proceeding shall appear on the court calendar on Part H, room 507 on June 30, 2015 at 9:30 in the forenoon for all purposes.