Opinion
L T 097761/08.
Decided July 6, 2010.
Novick Edelstein, Lubell, Reisman, Wasserman Leventhal, P.C., Yonkers, New York (Robert H. Leventhal of counsel), for petitioner.
Schuman Sall Geist, White Plains, New York (Matthew D. Schwartz of counsel), for respondent.
On July 16, 2009, this court entered an order granting summary judgment in favor of respondent, Anna Mchedlishvili, dismissing the holdover petition and awarding her a money judgement on her counterclaim for rent overcharges in the amount of $42,178.19. ( See Torres v Mchedlishvili, NYLJ, July 22, 2009, at 26, col 1, 2009 NY Slip Op 51528 [U] [Hous Part, Civ Ct, NY County, July 16, 2009].) After performing additional research, the court, in its letter of August 3, 2009, sua sponte invited the parties to submit additional papers solely on the issue of the rent overcharge.
In the original motion for summary judgment on respondent's counterclaim for rent overcharges, respondent alleged that based on the certified Division of Housing and Community Renewal (DHCR) rent history of the apartment dated October 17, 2008, the legal regulated rent for the apartment, as registered with the DHCR on July 20, 2007, was $513.23. In her affidavit in opposition, Antiona Landro, petitioner's daughter, contended that the $1700 monthly rent was legal because petitioner's DHCR fillings showed that petitioner registered apartment as vacant from 1999 to 2007. The court granted summary judgment for respondent and found that the $1700 monthly rent constituted an overcharge of $1186.77 a month. ( See id. at *3)
Petitioner now moves for leave to reargue and/or renew with respect to the court's overcharge determination.
Motion for Leave to Reargue and/or Renew for Rent Overcharges
Under CPLR 2221 (d) (2), a motion for leave to reargue "shall be based upon matters of fact or law allegedly overlooked or misapprehended by the court in determining the prior motion, but shall not include any matters of fact not offered on the prior motion." A motion for leave to renew "shall be based upon new facts not offered on the prior motion that would change the prior determination or shall demonstrate that there has been a change in the law that would change the prior determination." (CPLR 2221 [e] [2].)
Respondent contends that petitioner's motion should be denied on the basis that petitioner's motion seeks to present facts known by petitioner but not presented to the court on the underlying motion. ( See Cuccia v City of New York, 306 AD2d 2, 3 [1st Dept 2001] [denying renewal because the movant did not explain why he presented new facts in his revised affidavit].) Petitioner's original affirmation in opposition to respondent's overcharge allegation did not present a fully comprehensive discussion on the overcharge issue, but petitioner argued clearly that she was free to charge fair-market rent because Ms. Landro alleged the apartment was vacant from 1999 to 2007. The motion to renew is therefore inapplicable because petitioner does not offer new and material facts — petitioner offers some new facts but not dispositive ones — to refute respondent's overcharge claim. But petitioner has established that this court misapprehended the applicable law on the original motion. Thus, the motion to reargue is granted.
This court might not have properly applied the Rent Stabilization Code. RSC § 2526.1 (a) (3) (iii) provides that "[w]here a housing accommodation is vacant or temporarily exempt from regulation . . . on the base date, the legal regulated rent shall be the rent agreed to by the owner and the first rent stabilized tenant taking occupancy after such vacancy . . . and reserved in a lease or rental agreement." RSC § 2520.6 (f) (1) defines "base date" as "the date four years prior to the date of the filing of such appeal or complaint."
Even though petitioner registered the rent of $513.23 with the DHCR each year while the apartment was allegedly vacant, this rent might not be relevant. According to petitioner, it was paid by previous tenants who had vacated the apartment more than for years before respondent filed her overcharge counter claim in this proceeding. ( See Matter of McCarthy v DHCR, 290 AD2d 313, 314 [1st Dept 2002] [finding that rent paid by previous tenants who had vacated the apartment more than for years before filing the overcharge complaint was not part of the relevant rent history].)
In McCarthy, the tenant moved into the apartment on October 15, 1986, paying a monthly rent of $3818.99. That same day, the landlord filed its 1986 registration with the DHCR stating that the legal registered rent on April 1, 1986, was 1849.90. The registration indicated that the subject apartment was vacant on that date. ( Id. at 313.) Accordingly, the DHCR rent history showed that the apartment had been vacant from January 1985 through September 1986. The tenant sued on October 30, 1989, challenging the 1986 overcharge, and Supreme Court found the "base date" to be October 30, 1985, the date when the apartment was vacant. ( Id.) Although the tenant argued that the landlord registered the rate of $1849.90 with the DHCR within the four-year statute-of-limitations period, and thus that this sum should be the initial legal registered rent, the First Department disagreed. ( Id.)
The First Department found that the apartment was vacant on the "base date" and that no rent was charged. ( Id. at 314.) The court held that any "[r]ental history that falls outside the four-year period does not become reviewable simply because it is listed in a registration statement filed within the four-year period." ( Id.)
Petitioner here registered the apartment as vacant at a rate of $513.23 a month on July 20, 2007, and then leased the apartment to respondent for $1700 a month on October 1, 2007. If the apartment were vacant dating back to 1999, petitioner might have been free to charge $1700, as agreed to in the lease agreement, because the apartment would have been vacant on the "base date." Although the apartment's registered rent was $513.23, this rate corresponds to payments made by previous tenants outside the four-year period.
Respondent argues that petitioner failed timely to register the rent for her unit with the DHCR and that $513.23 is therefore the lawful regulated rent for the apartment.
As shown by Exhibit H, however, petitioner filed an amended registration with the corresponding rent of $1700 on April 16, 2009. Under RSC § 2528.4 (a), "[t]he late filing of a registration shall result in the elimination, prospectively, of such penalty, and for proceedings commenced on or after July 1, 1991, provided that increases in the legal regulated rent were lawful except for the failure to file a timely registration, an owner, upon the service and filing of a late registration, shall not be found to have collected a rent in excess of the legal regulated rent at any time prior to the filing of the late registration."
Petitioner's failure to file the up-to-date rent with the DHCR in a timely matter does not make the agreed-upon rent of $1700 unlawful. Due to the cure created by the amended registration as shown by Exhibit H, $1700 might have become the lawful rent upon petitioner's registration of the subject apartment with the DHCR.
Respondent challenges the credibility of petitioner's statements concerning the use of the subject apartment and contends that disclosure is necessary to investigate whether the apartment was vacant before respondent's lease term began. According to her affidavit, Ms. Landro used the subject apartment during the alleged vacancy from roughly June 2002 through August 2007 to assist her parents operate the building. ( See Landro Aff. ¶ 6.) According to Ms. Landro, the subject apartment was either vacant or used for non-residential purposes. ( See Landro Aff. ¶ 13.) Whether the apartment was vacant or used for non-residential purposes, no rent was allegedly paid, according to Ms. Landro, while petitioner had possession of the apartment. If true, this would establish that the apartment, if not vacant, was still exempt under the Rent Stabilization Code. An apartment unit like the one here may be considered temporarily exempt, if occupied by "[s]uperintendents . . ., managers or other employees to whom the space is provided as apart or all of their compensation without payment of rent and who are employed for the purpose of rendering services in connection with the premises of which the housing accommodation is a part." (RSC § 2520.11 [m].) Accordingly, the non-residential use of the apartment would not void petitioner's ability to charge the agreed-upon free-market rent.
Despite Ms. Landro's statements in her affidavit, the status of the subject apartment before respondent's tenancy began is inconclusive. Thus, summary judgment for petitioner, the nonmoving party who did not initially cross-move for summary judgment, is unwarranted. The law provides that "[i]f it shall appear that any party other than the moving party is entitled to summary judgment, the court may grant such judgment without the necessity of a cross-motion." (CPLR 3212 [b].) Although petitioner did not move for summary judgment, this court has the authority to search the record and award summary judgment to the nonmoving party with respect to an issue that was the subject of a motion before the court. ( See e.g. Micciche v Homes by The Timbers, Inc. , 1 AD3d 326 , 327 [2d Dept 2003] [granting summary judgment for the non-moving party after searching the record].) Under CPLR 3212, summary judgment is appropriate when no triable issue of material fact exists. ( E.g. Zuckerman v City of New York, 49 NY2d 557, 562.) But here the material issues of fact in dispute require a trial. ( See e.g. Alvarez v Prospect Hosp., 68 NY2d 320, 324.)
In Ms. Landro's original affirmation in opposition to the rent overcharge, she stated that the apartment was vacant but never acknowledged that it was temporarily exempt. ( See Landro Aff. in Opp. ¶ 34.) The DHCR registration in Exhibit H shows the apartment listed as vacant (VA) from 1999 to 2007, and petitioner did not list the designation "TE." "TE" is the designation for "temporarily exempt." Petitioner alleges in its motion for reargument that the apartment was temporarily exempt while Ms. Landro used it for non-residential purposes. But the apartment's correct status was not registered with the DHCR from 2002 through 2007, and its status was not disclosed in petitioner's original affirmation in opposition to the rent-overcharge counterclaim. Also, petitioner still listed the rent of $513.23 on the DHCR registration despite Ms. Landro's statements in her affadavit that no one was paying rent. ( See Landro Aff. ¶ 11.)
Petitioner contends that these inconsistencies with the rent registration history are mere "non-prejudicial infirmit[ies]" that this court should overlook. Nonetheless, whether the subject apartment was vacant, temporarily exempt, or neither must be resolved at trial to decide whether petitioner was free to charge the agreed-upon free-market rent. Respondent's request for disclosure, however, is denied. Among other reasons, respondent does not move for leave to obtain disclosure. A mere request in opposition papers is insufficient.
For the above reasons, the motion to reargue is granted, and the court vacates its grant of summary judgment in respondent's favor.
Having vacated its grant of summary judgment, respondent and petitioner are free at trial to argue any position it wishes on respondent's counterclaim for a rent overcharge. Nothing in this decision and order or in the court's decision and order of July 16, 2009, is binding on the trial judge. This proceeding is adjourned for trial on respondent's counterclaim to July 27, 2010.
This opinion is the court's decision and order.