Opinion
No. 2024-24197 Index No. 334081/23
07-12-2024
Underhill Realty Co., LLC, Petitioner, v. Darlyn R. Almonte & ENEROLIZA GREGORIO VENTURA, Respondents-Tenants, "JOHN DOE" & "JANE DOE," Respondents-Undertenants.
Horing, Welikson Rosen & Digrugilliers, P.C. Attorneys for Petitioner. Law Office of Gregory P. Mouton, Jr., LLC Attorneys for Respondents.
Horing, Welikson Rosen & Digrugilliers, P.C. Attorneys for Petitioner.
Law Office of Gregory P. Mouton, Jr., LLC Attorneys for Respondents.
Shorab Ibrahim, J.
HON. SHORAB IBRAHIM Judge.
Recitation, as required by C.P.L.R. § 2219(a), of the papers considered in review of this motion.
Papers Numbered
Notice of Motion with Affirmation, Affidavit and Memorandum of Law Annexed [With Exhibits A-E and A-P] [NYSCEF Doc. Nos. 31-55] 1
Notice of Cross-Motion with Affirmation and Affidavit Annexed [With Exhibits A-C] [NYSCEF Doc. No. 56] 2
Memorandum of Law in Reply [NYSCEF Doc. Nos. 56-57] 3
After oral argument, and upon the foregoing cited papers, the decision and order on this motion is as follows:
FACTUAL AND PROCEDURAL HISTORY
This is a holdover proceeding commenced by Petitioner Underhill Realty Co., LLC ("petitioner") against Darlyn R. Almonte ("respondent Almonte") and Eneroliza Gregoria Ventura ("respondent Ventura") ("respondents"). Petitioner seeks possession of 955 Underhill Avenue, Apt. 1603, Bronx, NY 10473, (the "subject premises" or "apartment"), on the basis that respondents are not using the premises as their primary residence and are primarily residing elsewhere, 28 Skidmore Road, Pleasant Valley, New York 12569 (the "upstate residence").
The court assumes the parties' familiarity with the background of this consolidated proceeding and refers the parties to the lengthy discussion of procedural history in the court's February 20, 2024 Decision and Order.
In that prior decision, the court denied respondents' motion to dismiss for failure to state a cause of action pursuant to CPLR § 3211(a)(7), finding that petitioner made out a cause of action for non-primary residence. The court also granted respondents' motion to amend the initial answer filed by their attorney, but also partially granted petitioner's motion to strike. As such, respondents were left only with the attorneys' fees claim, and their claim of entitlement to a renewal lease. Respondents' motion for sanctions was also denied. The court granted the majority of petitioner's motion for discovery, including depositions of respondents, and a portion of respondents' cross-motion for discovery. The proceeding was adjourned to April 29, 2024 for the court to monitor compliance with discovery.
Rather than completing discovery, respondents made the instant motion seeking, once again, to amend the answer. Respondents also seek dismissal or summary judgment on their proposed vitiation defense and dismissal or summary judgment on the grounds that they are not operating a daycare from the subject premises.
Respondents' second proposed amended answer seeks to add the following defenses: (i) vitiation of the termination notice by acceptance of rent; (ii) termination of tenancy for running a daycare; and (iii) the proceeding is barred by documentary evidence. As such, respondents argue they should be granted leave to re-amend the answer because there is no surprise or prejudice to petitioner, and it would therefore be an abuse of discretion not to allow amendment.
Respondents allege petitioner vitiated the termination notice by accepting a payment in August 2023 during the window period between termination of their tenancy and commencement of this case, continuing to accept payments from September 2023 through February 2024, and sending a letter dated August 16, 2023 advising respondents of a rent increase for the building approved by the Division of Housing Community Renewal ("DHCR") due to Major Capital Improvements ("MCIs") made to the building, effective September 1, 2023.
Penultimately, respondents claim that petitioner is attempting to terminate their tenancy for running a daycare from the subject premises, that such termination is against public policy as the law permits operation of a daycare even if the lease prohibits same, and that the proceeding must therefore be dismissed.
Finally, respondents seek an order directing petitioner to issue a renewal lease to a Mr. Reinoso-Garcia because, upon expiration of a rent stabilized lease, the lease must either be renewed, or a landlord must commence summary holdover proceedings.
In response, petitioner argues that it will be prejudiced if the court allows respondents to amend their answer a second time as respondents had the benefit of counsel for the entire time during this proceeding and any affirmative defenses should have been raised either in the initial answer or first amended answer. Respondents have not stated any reason for their failure to include the proposed affirmative defenses prior to the instant motion. The court notes that during oral argument, respondents' counsel's sole explanation for failing to include these proposed affirmative defenses in the initial or first amended answer was that he "did not think of it." Petitioner argues respondents are intentionally delaying the proceeding and should not be permitted to keep amending their answer if the court issues a decision there are unhappy with.
Petitioner further argues it did not vitiate the termination notice as there was no affirmative act on its behalf that would lead respondents to believe their tenancy was reinstated and mere inadvertent acceptance of one rent check in August 2023 is insufficient. Acceptance of payments from September 2023 forward, after commencement of the proceeding, is irrelevant.
As to the portion of respondents' motion arguing for dismissal based upon operation of an unauthorized daycare, petitioner points out that this case is based on non-primary residence and the motion is therefore irrelevant and improper. Similarly, petitioner argues that respondents' proposed defense of documentary evidence is improper as it is not pleaded with particularity.
Next, petitioner avers that respondents are not entitled to a renewal lease because they do not reside in the subject premises as their primary residence, and they are not entitled to attorneys' fees. Finally, petitioner seeks an order of preclusion preventing respondents from offering evidence or testimony in support of their defenses as they have failed to comply with the court's February 2024 Order to provide discovery.
DISCUSSION
MOTION TO AMEND THE ANSWER
As previously stated in the court's February 2024 Order, CPLR §3025(b) provides that leave to amend a pleading shall be freely given upon such terms as may be just. (see Norwood v City of New York, 203 A.D.2d 147, 148-149 [1st Dept. 1994]). Amendment can be at any time, especially where there is not significant prejudice to the opposing party. (see National Union Fire Ins. Co. v Schwartz, 209 A.D.2d 289, 290 [1st Dept. 1994]). However, "affirmative defenses that are without factual foundation, conclusory or duplicative cannot stand." (O-SB 510 Sixth Fin., LLC v 510 Borrower LLC, 2024 NY Slip Op 30203[U], *3 [Sup Ct, NY County 2024]; Emigrant Bank v Myers, 147 A.D.3d 1027, 1028 [2nd Dept. 2017]).
The court will not re-address the defense of entitlement to a renewal lease or attorneys' fees counterclaim, as these claims and defenses were addressed and allowed in the February 2024 Order. The court will address solely the second through fourth proposed defenses herein.
a. Fourth Proposed Affirmative Defense
CPLR §3013 requires that "[S]tatements in a pleading shall be sufficiently particular to give the court and parties notice of the transactions, occurrences of series of transactions or occurrences intended to be proved and the material elements of each cause of action or defense." A pleaded defense must contain enough particularity to give the court and the plaintiff notice of what is intended to be proven as well as the material elements of that defense. (see Dept. of Hous. Preserv. & Dev. of the City of NY v Simply Better Apt. Homes, 2020 NY Slip Op 50637[U], *5 [Civ Ct, Bronx County 2020]), citing Foley v D'Agostino, 21 A.D.2d 60, 62 [1st Dept. 1964]). Similarly, a defense that is free of facts will be stricken, as defenses that merely plead conclusions of law are insufficient. (see CPLR § 3013(b); Robbins v Growney, 229 A.D.2d 356, 358 [1st Dept. 1996]; Brody v Soroka, 173 A.D.2d 431, 433 [2nd Dept. 1991]; Emigrant Bank v Myers, 147 A.D.3d 1027, 1028 [2nd Dept. 2017]).
Respondents' proposed fourth affirmative defense, that "the instant action is barred by documentary evidence" is patently insufficient. The proposed defense is pleaded with no particularity whatsoever and a complete lack of factual allegations. The court cannot possibly determine what documentary evidence respondents are referring to in order to determine whether the defense has merit. As such, leave to add the fourth proposed affirmative defense is denied.
b. Third Proposed Affirmative Defense
Proposed defenses which "plainly lack merit" should be denied, (see Thomas Crimmins Contracting Co. v New York, 74 N.Y.2d 166, 170 [1989]), as should defenses with no foundation in fact. (see O-SB 510 Sixth Fin., LLC v 510 Borrower LLC, 2024 NY Slip Op at *3).
Respondents' third proposed affirmative defense alleges that it is against public policy to terminate their tenancy for running a daycare facility. This defense is meritless. As fully iterated in this court's February 2024 Order, the Golub notice in this proceeding is clear: petitioner is not renewing respondents' lease, and is terminating their tenancy, based upon one ground, and one ground only: failure to maintain the subject premises as their primary residence. The notice states the sole ground under the Rent Stabilization Code petitioner is proceeding on - RSC §2524.4(c), failure to maintain the subject premises as respondents' primary residence. The remaining factual allegations, including the allegations that respondents are seen in the apartment during the day only, as they are running a daycare from the apartment, are all in support of the non-primary residence cause of action.
Nowhere in the Golub notice or petition does petitioner state that respondents' tenancy is terminated for operating a daycare from the apartment and the court will not impute this non-existent claim into this proceeding. As such, the proposed third affirmative defense is denied as utterly without merit. For the same reason, the motion to dismiss or for summary judgment on this proposed defense is denied in its entirety.
The second proposed affirmative defense shall be addressed below.
VITIATION OF TERMINATION NOTICE
a. Amendment of the Answer to Include Vitiation Defense
Respondents seek to amend their answer a second time to include an affirmative defense that petitioner vitiated the termination notice by acceptance of a rent payment during the window period, acceptance of additional checks after commencement of this proceeding and sending notice of an MCI increase to respondents.
As previously discussed in the February 2024 Order and noted above, the law is clear that, pursuant to CPLR §3025(b), leave to amend a pleading shall be freely given upon such terms as may be just. (see Norwood v City of New York, 203 A.D.2d at 148-149). Amendment can be at any time, especially where there is not significant prejudice to the opposing party. (see National Union Fire Ins. Co. v Schwartz, 209 A.D.2d at 290).
"On such a motion, the allegations set forth in the answer must be viewed in the light most favorable to the defendants and 'the defendant is entitled to the benefit of every reasonable intendment of the pleading, which is to be liberally construed'." (Pugh v New York City Hous. Auth., 159 A.D.3d 643, 643 [1st Dept. 2018] [internal citations omitted]; West 115 11-13 Assocs. LLC v Pierre, 2023 NY Slip Op 31069(U), *7 [Civ Ct, New York County 2023] [internal citation omitted]).
While dismissal based on vitiation is denied, as fully discussed below, the court cannot say that the proposed defense of vitiation has no merit as a matter of law, and it is irrelevant whether respondents will prevail on said defense at trial.
Further, petitioner's claims of prejudice due to respondents' strategy of seeking leave to assert new defenses after their initial bites at the apple (i.e., the initial answer, first amended answer and initial motion to dismiss) have failed, are not sufficient to deny respondents' motion to amend, given the liberal standard for amendment of the answer.
Although respondents undisputedly delayed this proceeding, delay alone is insufficient; it must be coupled with significant prejudice. (see Sass v Mack Trucks, Inc., 158 A.D.2d 332, 333 [1st Dept. 1990]). Prejudice in this context is shown where the nonmoving party is "hindered in the preparation of his case or has been prevented from taking some measure in support of his position." (Loomis v Civetta Corinno Constr. Corp., 54 N.Y.2d 18, 23 [1981]; Jacobson v McNeil Consumer & Specialty Pharmaceuticals, 68 A.D.3d 652, 654-655 [1st Dept. 2009]).
Petitioner has not alleged the type of prejudice required to deny respondents' motion to amend and petitioner has, and continues to, effectively defend against respondents' defenses and counterclaims as well as prosecute its cause of action.
As such, respondents' motion for a second amended answer is granted solely to the extent of allowing respondents to add a vitiation defense.
While the court ultimately grants respondents' second motion to interpose a second amended answer to include a vitiation claim, given the liberal standard on a motion to amend the answer, the court does not condone the represented respondents' piece-meal strategy. Respondents, who were represented by counsel at least since the filing of the initial answer, chose to interpose an answer, move to amend the same answer as well as move for dismissal on that amended answer, wait for the court rule on their motions, then, when the outcome was not in their favor, make a second motion to again amend the answer. Respondents provide no reasonable explanation for their failure to include this new round of proposed defenses either in the initial or first amended answer. Such practice clearly opens the door for represented litigants to purposefully hold back defenses so that they might get additional bites at dismissal. Such practice deliberately delays these summary proceedings at the expense of the opposing party and wastes valuable court resources.
b. Dismissal Under CPLR §3211 Based on the Vitiation Defense
Respondents seek dismissal on their vitiation defense pursuant to CPLR §3211(a). However, CPLR §3211(e) states that, "At any time before service of the responsive pleading is required, a party may move on one or more of the grounds set forth in subdivision (a), and no more than one such motion shall be permitted. [emphasis added]
Successive motions pursuant to CPLR §3211 are prohibited. (see McLearn v Cowen & Co., 60 N.Y.2d 686, 689, [1983]; Zavulunov v Law Offs. of Yuriy Prakhin, P.C., 2024 NY Slip Op 31598[U], *3 [Sup Ct, Kings County 2024] ["this 'single motion rule,' generally prohibits parties from making successive motions to dismiss a pleading pursuant to CPLR 3211(a) as well as subsequent motions to dismiss that pleading on alternate grounds"] [internal citations omitted]; Natl. Convention Servs., LLC v FB Intl., Inc., 2023 NY Slip Op 34042[U], *18-19 [Sup Ct, NY County 2023]; Mariano v Krautman, 28 Misc.3d 1233 (A), *2-3 [Dist Ct, Nassau County 2010] ["According to Professor David Siegel, in his discussion of a 'single motion rule,' only one CPLR 3211 (a) motion is allowed per case to 'avoid duplication because the movant can join in the one motion whatever grounds he then has.' (Siegel, New York Practice § 273, at 454 [4th ed])"].
Despite the clear limit of CPLR §3211(e), respondents failed to seek dismissal on their vitiation claim in their prior motion. As such, the motion to dismiss is denied.
c. Summary Judgment Under CPLR §3212 Based on the Vitiation Defense
In the alternative, respondents seek summary judgment dismissal on their vitiation defense pursuant to CPLR §3212. Summary judgment is a drastic remedy, to be granted only where the moving party has tendered sufficient evidence to demonstrate the absence of any material issues of fact and then only if, upon the moving party's meeting of this burden, the non-moving party fails to establish the existence of material issues of fact which require a trial of the action. (see CPLR § 3212(b); Alvarez v Prospect Hosp., 68 N.Y.2d 320, 324 [1986]; Andre v Pomeroy, 35 N.Y.2d 361 [1974]).
Indeed, even respondents' prior motion to dismiss was actually one for summary judgment, as it was made post-answer.
When deciding a summary judgment motion, the court views the alleged facts, evidence and inferences in the light most favorable to the non-moving party. (see Sosa v 46th St. Dev. LLC, 101 A.D.3d 490, 492 [1st Dept. 2012]; Rizzo v Lincoln Diner Corp., 215 A.D.2d 546, 546 [2nd Dept. 1995]). The movant must make a prima facie showing of entitlement to judgment as a matter of law by submitting evidence in a form admissible at trial. (see Zuckerman v New York, 49 N.Y.2d 557, 562 [1980]; Torres v Indus. Container, 305 A.D.2d 136, 136 [1st Dept 2003]). Failure to do so requires "denial of its motion, regardless of the claimed insufficiency of plaintiff's opposition." Coastal Sheet Metal Corp. v Martin Assoc., 63 A.D.3d 617, 618 [1st Dept. 2009]; see also 157 E. 89th St., LLC v McAuliffe, 42 Misc.3d 143 (A), *2 [App Term, 1st Dept. 2014]).
Respondents have not shown they are entitled to summary judgment. Pursuant to RPAPL § 711(1), a landlord may accept rent from the tenant prior to the expiration of the termination notice and use and occupancy after commencement of the holdover proceeding.
Acceptance of payment during the period after expiration of a notice of termination but before commencement of the proceeding (the "window period") may vitiate the predicate notice and nullify the proceeding. (see 1412 Broadway LLC v Great White Bear, LLC, 18 Misc.3d 1121 [A], *3 [Civ Ct, New York County 2007], citing Gramercy Realty Co. v. Smith, NYLJ, March 24, 1981, at 6, col 1 [App Term, 1st Dept 1981]; Cadim Stonehenge 56th St. Assoc., L.P. v Blue, 2000 NY Misc. LEXIS 683, at *1 [App Term, 1st Dept 2000]). The rationale that predicate notices may be vitiated under such circumstances is that "acceptance of rent for a period after expiration of the notice sends the tenant a message contrary to that contained in the notice." (Assoc. Realties v Brown, 146 Misc.2d 1069, 1070 [Civ Ct, New York County 1990]).
The window period is from the time the predicate notice expires through the date the proceeding is commenced. (see 433 W. Assoc. v Murdock, 276 A.D.2d 360, 361 [1st Dept 2000]; Sebco Hous. Dev. Fund Co., Inc. v Acosta, 66 Misc.3d 147 (A), *1 [App Term, 1st Dept. 2020] (noting no vitiation from accepting payments after case commenced or before the termination date)). A special proceeding, such as this holdover proceeding, is commenced on the date the index number is purchased and the petition is filed with the court. (see ABN Assoc., LLC v Citizens Advice Bur., Inc., 27 Misc.3d 143 (A), *1, [App Term, 1st Dept. 2010]; 92 Bergenbrooklyn v Cisarano, 50 Misc.3d 21, 22 [App Term, 2nd Dept. 2015]). Here, the window period is from July 31, 2023, the date the termination notice expired, to August 20, 2023, the day before the petition was filed.
Respondents argue petitioner vitiated the termination notice by accepting a rent payment online, via a third-party payment portal, on August 8, 2023, by accepting subsequent payments by money orders from September 2023 through February 2024, and by sending respondents a letter dated August 16, 2023 requiring them to pay a higher rent starting September 2023.
The court first addresses the argument that acceptance of money orders from September 2023 forward vitiated the termination notice. Contrary to respondents' claim, acceptance of payments after commencement of the instant proceeding does not vitiate the notice nor require dismissal. (see RPAPL § 711(1) "(a)cceptance of rent after the commencement of the special proceeding upon this ground shall not terminate such proceeding nor effect any award of possession to the landlord...."; see also Brodcom West Dev. Co. v Lumpkin, 2008 NY Misc. LEXIS 7502 at *7; Sebco Hous. Dev. Fund Co., Inc. v Acosta, 66 Misc.3d at *1).
Next, the court turns to the argument that the August 16, 2023 letter demanded a higher rent and therefore vitiated the termination notice. Petitioner purports it is a computer generated letter. (see NYSCEF Doc. 56, par. 17). In any event, contrary to respondents' description, the letter does not demand anything. It is entirely informational. The MCI increase, approved by the DHCR, applied to all units in the building and required notice be sent to each unit. The notice contains standard language and clauses regarding the effect of the MCI on recently renewed leases, tenants with section 8 or SCRIE/DRIE, etc.
see https://hcr.ny.gov/apartment-iai-and-building-mci-improvements. (noting that owners "must give the tenant a statement showing the rental recalculation" and that if owners do not charge the MCI increases within certain time periods, "the MCI rent increase may be considered permanently waived." Last accessed on July 9, 2024.
As such, the court cannot say that this notice, apparently applicable to all units in the building, and required by DHCR to be sent to all units, is the type of conduct by petitioner that would send respondents a message contrary to that contained in the termination notice, namely that the tenancy is reinstated. (see Assoc. Realties v Brown, 146 Misc.2d at 1070).
At the very minimum, vitiation is an issue for trial, especially where the sole affidavit, from Darlyn Almonte, does not once claim that he believed the termination notice was no longer valid, that petitioner was choosing not to move forward with this case, or that his tenancy was reinstated. Although respondent Almonte repeats the alleged acts by petitioner that respondents now argue vitiated the termination, never does he allege he actually believed the termination was vitiated. Recitation of these acts, without more, is insufficient as a matter of law, especially as respondents' subjective belief in whether their tenancy remained terminated is relevant.
Finally, the court turns to the argument that acceptance of one payment on August 8, 2023, during the window period, is sufficient as a matter of law to vitiate the termination notice.
Relevant caselaw makes it clear that acceptance of rent alone is not sufficient to show waiver or to warrant dismissal: "a landlord's acceptance of unsolicited rent after the expiration of a lease does not, standing alone, amount to a voluntary relinquishment of the right to contest a tenant's possession," where "there is no evidence that the petitioner either affirmatively acted in order to solicit [tenant's] rent checks... or that the petitioner gave [tenant] the impression that it intended to reinstate her tenancy." (Matter of Georgetown Unsold Shares, LLC v Ledet, 130 A.D.3d 99, 105 [2d Dept 2015]; see also Goldman v Becraft, 6 Misc.3d 135(A), *1-2 [App Term, 1st Dept 2001]; Metro. Ins. & Annuity Co. v Hartman, 11 Misc.3d 140 [A], *1 [App Term, 1st Dept 2006]).
Generally speaking, courts in the First Department have been unwilling to dismiss cases where just one unsolicited payment is made. (see id; Beacon 109 223-225 LLC v Mon Sheng Wu, 32 Misc.3d 140 [A], *2 [App Term, 1st Dept 2011]; West Waverly Equities v Lieff, 190 Misc.2d 280, 281 [App Term, 1st Dept. 2001]; Sebco Hous. Dev. Fund Co., Inc. v Acosta, 66 Misc.3d at *1 [App Term, 1st Dept 2020]; 49 Terrace Corp. V Richardson, 36 Misc.3d 143(A), *1 [App Term, 1st Dept. 2012]).
Even when a landlord retains multiple payments, the Appellate Term has been resistant to dismissal on the basis that vitiation is a waiver claim which turns on intent and intent is usually a triable issue. (see 145 East 16th Street LLC v Nanda, 61 Misc.3d 128 (A), *1 [App Term, 1st Dept. 2018], citing Jefpaul Garage Corp. v Presbyterian Hosp., 61 N.Y.2d 442, 446 [1984]).
205 E. 78th St. Assoc. v Cassidy, (192 A.D.2d 479 [1st Dept. 1993]), upon which respondents primarily rely, does not require a different outcome. In Cassidy, dismissal eventuated because the landlord accepted and retained a window-period payment and did not explain any alleged inadvertence. (see Esplanade Gardens, Inc. v Simms, 51 Misc.3d 1228 (A), *1-2 [Civ Ct, New York County 2016]). According to Simms, Cassidy stands for both the proposition that the "notice of termination is nullified when the landlord accepts and retains the tenant's payment of rent after termination of the tenancy but prior to commencement of the holdover eviction proceeding" and that "a tenant arguing for vitiation of a termination notice need not prove that the landlord intended to relinquish a known right when it accepted rent after termination but prior to commencement of the proceeding. (see id at 2 [emphasis added]).
In Cassidy, the Appellate Division did not provide an opinion with its order. As such, Judge Weisberg in Simms relays the facts as stated in the lower court opinions.
Cassidy is still good law, but it does not require dismissal here. This was made clear just last month when the Appellate Division, First Department issued an opinion in 591 Realty LLC v Curanaj, (2024 NY Slip Op 03007 [1st Dept. 2024]). In Curanaj, an ejectment case based on non-primary occupancy, the court cites to Cassidy, but holds that "[a] landlord's mere receipt of rent checks" in the window-period "does not alone serve to vitiate a predicate notice, especially where the landlord promptly returns the checks uncashed, or where the rent checks, although cashed, were accepted inadvertently and the landlord promptly explains the inadvertence to the tenant." (id [emphasis added]).
Cassidy is cited immediately following this quoted language. (see Curanaj, 2024 NY Slip Op 03007).
To be fair, Simms acknowledges that Cassidy left some space for a landlord to claim inadvertence as a "defense" to vitiation. (see 51 Misc.3d at *5 [" Cassidy did not necessarily create an absolute rule that acceptance of rent post-termination but pre-commencement requires dismissal. It seems to have left room for inadvertent acceptance of rent, where the explanation of inadvertence is reasonable and where the rent was refunded to the tenant."]). Curanaj makes intent central to the vitiation issue.
Inadvertence is the noun form of the adjective inadvertent. Something done inadvertently is done unintentionally. In other words, intent very much matters when determining whether the termination notice was vitiated. This court also notes that the Curanaj court repeatedly uses the plural "checks" in its opinion. Perhaps this is solely because there were multiple checks in the window-period there, though the plural is used when the court discusses the general rule as well as when discussing the specific facts of that case. Or it could be that a single payment accepted in the window period should be treated differently than acceptance of multiple payments.
see https://www.merriam-webster.com/dictionary/inadvertent. Last accessed on July 9, 2024.
It is also possible that Curanaj, by citing Metropolitan Life Ins. Co. v Sucdad, 1985 NY Misc. LEXIS 3361, *1 [App Term, 1st Dept 1985], extends the "inadvertence" rationale to more than just non-primary residence matters. This court cannot say with certainty, but Sucdad appears to be some sort of illegal sublet case ("It is quite clear that the rent stabilized tenant... assigned the premises... without seeking the consent of the landlord," [emphasis added] 1985 NY Misc. LEXIS 3361 at *1).
Ultimately, the Appellate Division affirmed dismissal in Curanaj because the landlord accepted three checks in the window period and then waited months before returning the checks and did not explain the delay. (id). Here, intent is not so clear as to eliminate the need for a trial. (see 145 East 16th Street LLC v Nanda, 61 Misc.3d 128 (A), *1).
Furthermore, many courts have held that a lockbox payment is an exception to the rule that acceptance of rent during the window period vitiates a predicate notice, as such payments are automatically sent to and deposited into a landlord's bank account. (see Liant Record Co. v Newman, 1993 NY Misc. LEXIS 628 [App Term, 1st Dept 1983]; 83rd St. Assoc. v Gourmet Wine & Spirits, Ltd., 1993 NY Misc. LEXIS 629 [App Term, 1st Dept 1983]; Sebco Hous. Dev. Fund Co., Inc. v Acosta, 66 Misc.3d at *1; 1412 Broadway LLC v Great White Bear, LLC, 18 Misc.3d 1121 [A], *3, 856 N.Y.S.2d 500 [Civ Ct, New York County 2007]). These cases both pre and post-date Cassidy.
Courts have extended the rationale from these lockbox payment cases to payments made online via a third-party platform, where, once the payee establishes an account, unsolicited payments can be easily made "as they require nothing more than a few clicks and may even be made through an application on a cellular telephone." (1371 Franklin Ave LLC v Pugh, 67 Misc.3d 368, 370 [Civ Ct, Bronx County 2020]).
Here, although respondents were able to make an online Zelle payment on August 8, 2023, petitioner's agent alleges inadvertent acceptance. Petitioner's agent averred that petitioner attempted to disable respondents' ability to make on-line payments on Zelle, and it was ultimately disabled, but only after the termination notice expired. (see NYSCEF Doc. 56). This too goes to intent and is a triable issue.
The court concedes that the rule might be different when the window period follows other types of termination notices. However, when it follows a Golub notice, as is the case here, and as was the case in Curanaj and Ledet, the court cannot say that inadvertent acceptance of a payment during the window period vitiates the termination notice as a matter of law.
Where, as here, only one payment was accepted during the window period, the payment was made to the equivalent of a lockbox, the inadvertence acceptance was adequately explained and there is no evidence that petitioner solicited the payment, respondents have failed to establish vitiation as a matter of law. As such, the summary judgment motion is denied.
ORDER DIRECTING PETITIONER TO PROVIDE A RENEWAL LEASE
The court denies respondents' motion for an order directing petitioner to issue a renewal lease. This is, in essence, a different way to seek summary judgment. In any event, "[e]xcept for proceedings for the enforcement of housing standards, and applications for certain provisional remedies, the New York City Civil Court may not grant injunctive relief." (Broome Realty Associates v Sek Wing Eng, 182 Misc.2d 917, 918 [App Term, 1st Dept. 1999] [internal citation omitted]). Thus, the court cannot order petitioner to provide a lease. (see Jamaica Seven, LLC v Villa, 2020 NY Slip Op 50630(U) [App Term, 2nd Dept. 2020]; see also Morningside Partners I, LP v Fofanah, 15 Misc.3d 1132 (A), 2 [Civ Ct, New York County 2007]).
ATTORNEYS' FEES
Respondents' motion for attorneys' fees is denied as premature. It is settled law that only the prevailing party may collect legal fees. (see Nestor v McDowell, 81 N.Y.2d 410, 415 [1993]).
CROSS-MOTION TO PRECLUDE
Petitioner cross-moves to preclude respondents from presenting evidence or testimony in support of their alleged defenses for failure to comply with the court's February 2024 Order granting discovery.
"CPLR 3126... governs discovery penalties and applies where a party 'refuses to obey an order for disclosure or willfully [sic] fails to disclose information which the court finds ought to have been disclosed'." (Gibbs v St. Barnabas Hosp., 16 N.Y.3d 74, 79 [2010] [internal citations omitted]). Among those sanctions and penalties are dismissal of the proceeding or an order to strike or preclude. (see CPLR §3126[2] & [3]).
"Further, the nature and degree of a penalty to be imposed on a motion pursuant to CPLR 3126 is left to the discretion of the [court]... 'To invoke the drastic remedy of preclusion, the [court] must determine that the offending party's lack of cooperation with disclosure was willful, deliberate, and contumacious'... 'The willful and contumacious character of a party's conduct may be inferred from the party's repeated failure to comply with court-ordered discovery, and the absence of any reasonable excuse for those failures, or a failure to comply with court-ordered discovery over an extended period of time'." (Lawrence v 239 E. 115th St. Hous. Dev. Fund Corp., 2018 NY Misc. LEXIS 879, *11 [Sup Ct, New York County 2018] [internal citations omitted]; see also Montemurro v Memorial Sloan-Kettering Cancer Ctr., 94 A.D.3d 1066, 1066, [2nd Dept. 2012] ["the willful or contumacious character of the conduct at issue could properly be inferred by the court from her repeated failures, without an adequate excuse, to comply with discovery demands and the court's discovery orders to provide certain disclosure"]).
As such, for petitioner to prove it is entitled to the relief requested, it must prove the following: (i) respondents willfully failed to comply with discovery; and (ii) this court has found that discovery demanded are items which should have and ought to have been provided.
It is undisputed that the discovery demands are items that should and ought to have been provided as this court issued a prior Decision and Order in February 2024 finding that petitioner was entitled to most of the discovery it sought and ordering respondents to comply.
However, petitioner offers little discussion as to whether or why respondents' failure to comply was willful or contumacious. (see Kovacs v Castle Restoration & Constr., Inc., 262 A.D.2d 165, 166 [1st Dept. 1999] ["sanctions... may be granted only when the failure is willful. Thus, before the sanction of preclusion is granted or a pleading stricken, a showing of 'willful and contumacious conduct' is necessary... As noted, plaintiff had never asserted, much less demonstrated, that defendant's failure to provide a bill was willful or contumacious."] [internal citations omitted]). Petitioner's sole argument is that respondents' failure to comply with discovery has caused a delay, from which willfulness can be inferred. This is inaccurate.
Although respondents undoubtedly delayed this proceeding, they cannot be said to have repeatedly failed to comply with discovery or with a court order to comply. Nor was respondents' failure to comply over an extended period. Upon receiving the court's February 2024 Order, respondents quickly interposed the instant motion.
Respondents' reply makes it clear they were under the impression that the current motion to dismiss stayed their time to comply with discovery. (see CPLR § 3211(g)(3)). Although this second motion to dismiss is denied, this court cannot say that respondents willfully disregarded the prior order, especially since respondents also moved under CPLR § 3212.
In any case, a party seeking preclusion or an order to strike a pleading must first move to compel compliance and must show that they made a good faith effort to resolve the issue with the other party before moving for more drastic relief. (see Charter One Bank v Houston, 300 A.D.2d 429, 430 [2nd Dept. 2002] ["The appellants' request for preclusion is unavailing. The appellants were not entitled to sanctions under CPLR 3126 without first moving to compel accompanied by an affirmation that they made a good faith effort to resolve the discovery dispute... "] [internal citations omitted]; Kovacs v Castle Restoration & Constr., Inc., 262 A.D.2d at 166 ["Nor did plaintiff's counsel comply with 22 NYCRR 202.7 (a) (2), which required plaintiff to make a good faith attempt to resolve the issue with defense counsel before moving to preclude, supported by his affirmation to that effect."]).
Petitioner did not, prior to moving for an order to strike and/or preclude, move to compel respondent's compliance. Nor does petitioner assert in its motion that it attempted to resolve the issue with respondent or bring this issue to the court's attention prior to making the instant motion.
Upon such facts, an order striking the pleading, or an order of preclusion, is not warranted and is therefore denied. Respondents are, however, ordered to comply with the court's February 2024 Decision and Order and respond to the discovery demands and notices of deposition within 30 days this Order being uploaded to NSYCEF.
This matter is adjourned to August 14, 2024 at 9:30 am for the court to monitor compliance and all other purposes.
This constitutes the decision and order of the court. It will be posted on NYSCEF.
SO ORDERED.