FORECLOSURE SALE HAS SURPLUS BUT HOMEOWNER CANNOT BE FOUND

MATTER OF EMIGRANT MTGE. CO. v. Long, 2023 NY Slip Op 32400 - NY: Supreme Court 2023:

"In this proceeding pursuant to CPLR 2601, Emigrant Mortgage Company (Emigrant) petitions for permission to deposit, into the court, the surplus proceeds that it obtained upon the foreclosure and sale of shares in a residential cooperative corporation. The respondent borrowers, whose shares had been foreclosed, do not oppose the petition. The petition is granted.

On January 4, 2000, Emigrant initiated a loan to Marcia Long and Anne Long (together the borrowers) in the principal amount of $125,000.00. Emigrant secured repayment of the loan by perfecting a security interest in the shares of capital stock and a proprietary lease that had been issued by residential cooperative corporation 325 East 80th Apts. Corp. in connection with Apartment 4H, 325 East 80th Street, New York, New York. Emigrant perfected the security interest by filing a UCC-1 financing form with the New York City Register on January 14, 2000, as amended January 18, 2000, supplemented March 28, 2006, and further supplemented March 20, 2008. The borrowers thereafter defaulted on their loan obligations by failing to pay the regular monthly installments of principal and interest as they became due.

Where a cooperative tenant-shareholder defaults "on a security agreement which underlies a loan related to the purchase of shares in a cooperative, the remedies found in UCC article 9 are available to the lender" (Fridman v Dime Say. Bank of N.Y., 204 AD2d 387, 388, [2d Dept 1994]). On June 27, 2022, after providing notice to the borrowers, Emigrant thus conducted a non-judicial foreclosure with respect to the shares and proprietary lease pursuant to UCC 9-610, which provides that, when a debtor defaults on a security agreement, the secured party "may sell, lease, license, or otherwise dispose of any or all of the collateral" (UCC 9-610[b]; see LI Equity Network, LLC v Village in the Woods Owners Corp., 79 AD3d 26, 30 [2d Dept 2010]). At the auction, Emigrant sold the collateral to Zeev Sheinfeld for the sum of $395,000.00. From the proceeds of the sale, the sum of $86,588.78 was paid to Emigrant in satisfaction of the borrowers' loan obligations, and an additional sum was paid to Emigrant's attorneys as and for their fees. There are no other lienholders with respect to the shares and proprietary lease. A surplus in the sum of $304,427.87 currently remains, subject to any further request for an award of attorneys' fees that Emigrant may submit to the court.

Emigrant's attorneys thereafter attempted to contact the borrowers so that they could be paid the portion of the surplus that was owed to them. On or about October 3, 2022, Emigrant's attorneys contacted Plymouth Management Group (PMG), which manages the subject cooperative apartment building. Although PMG provided counsel with a cell phone number for Anne Long, and Emigrant's attorneys left a voicemail, they never received a response. On November 14, 2022, Emigrant's attorneys performed an online search, obtained last known addresses and possible email addresses for both Marcia Long and Anne Long, and immediately mailed and emailed them a letter at the addresses obtained from the search, advising them of the surplus and providing them with information necessary for Emigrant to release the surplus to them. The borrowers nonetheless failed to respond. This proceeding ensued.

Shares in a residential cooperative corporation are considered personal property rather than real property (Matter of Pollack, 18 AD3d 555, 557 [2d Dept 2005]). In connection with the foreclosure and sale of personal property that had been the subject of a security interest, UCC 9-615(d) provides that, with certain exceptions not applicable here, the "secured party shall account to and pay a debtor for any surplus." UCC article 9 does not, by its terms, compel the secured party to deposit the surplus into court where the payees cannot be located (cf. RPAPL 1354[4] [requiring that any surplus remaining after a mortgagee's lien has been satisfied from the proceeds of sale of real property must be paid into court]), but research has revealed no authority prohibiting a court from exercising its jurisdiction pursuant to CPLR 2601 to direct such a deposit under the circumstances presented here. CPLR 2601(b) provides, in pertinent part, that

"[a]ll moneys and securities paid into court shall be delivered either by the party making the payment into court ... or to such other county treasurer as the court specially directs.... The commissioner of finance of the city of New York shall be considered the treasurer of each of the counties included within the city."

The court concludes that there is sound basis for directing Emigrant to deposit the surplus of the foreclosure sale in this case with the Commissioner of the New York City Department of Finance, who shall hold the deposit in trust for Marcia Long and Anne Long, who, in turn, shall be entitled to the payment of the amount so deposited upon their compliance with the provisions of the New York City Administrative Code and the Rules of the City of New York applicable to claims upon such funds."

NEIGHBOR DISPUTES - THROWING THE KITCHEN SINK

Apparently, to this court, in the extreme neighbor dispute in a co-op, the proper cause of action is private nuisance and intentional infliction of emotional distress.

Mrishaj v. Moore, Date filed: 2023-06-12, Court: Supreme Court, New York, Judge: Justice Lucy Billings, Case Number: 156029/2022:

PLAINTIFFS’ FACTUAL ALLEGATIONS

Plaintiff Ervin Mrishaj purchased a proprietary lease for apartment D2K at 920 Pelhamdale Avenue, Pelham, New York, from nonparty cooperative Caroline Gardens Apartment Corporation October 5, 2021. He, his wife, plaintiff Tropoj Mrishaj, and their two children moved into the apartment at the beginning of November 2021. Defendant resided in apartment D1K, directly below plaintiffs.

Plaintiffs allege that every day, from November 5, 2021, to March 25, 2022, defendant constantly screamed profanities at plaintiffs and repeatedly struck her ceiling with a broom or similar hard object. They allege that defendant’s conduct adversely affected plaintiffs’ sleep and health and the development of the children, particularly plaintiffs’ child E.M., who ran screaming to her parents from the noise.

Defendant also had a personal relationship with the president of the cooperative’s board of directors, which defendant leveraged to convince the cooperative to issue a notice of termination to plaintiffs March 2, 2022. Plaintiffs subsequently vacated their apartment March 25, 2022. On June 22, 2022, defendant claimed to Ervin Mrishaj’s parents, who also resided in the same building, that she had evicted plaintiffs.

II. APPLICABLE STANDARDS

Upon a motion to dismiss the complaint, the court considers the complaint’s factual allegations as true. Sassi v. Mobile Life Support Servs., Inc., 37 N.Y.3d 236, 239 (2021); Himmelstein, McConnell, Gribben, Donoghue & Joseph, LLP v. Matthew Bender & Co., Inc., 37 N.Y.3d 169, 175 (2021); Yovich v. Montefiore Nyack Hosp., 212 A.D.3d 425, 426 (1st Dep’t 2023). In a motion pursuant to C.P.L.R. §3211(a)(7), defendant bears the burden to establish that the complaint “fails to state a viable cause of action.” Connolly v. Long Island Power Auth., 30 N.Y.3d 719, 728 (2018). Dismissal is warranted if the complaint fails to allege facts that “fit within any cognizable legal theory.” Sassi v. Mobile Life Support Servs., Inc., 37 N.Y.3d at 239.

A motion to dismiss based on documentary evidence pursuant to C.P.L.R. §3211(a)(1) will succeed only if admissible documentary evidence completely refutes plaintiffs’ factual allegations, resolving all factual issues as a matter of law. Himmelstein, McConnell, Gribben, Donoghue & Joseph, LLP v. Matthew Bender & Co., Inc., 37 N.Y.3d at 175; Nomura Home Equity Loan, Inc., Series 2006-FM2 v. Nomura Credit & Capital, Inc., 30 N.Y.3d 572, 601 (2017); Goshen v. Mutual Life Ins. Co. of N.Y., 98 N.Y.2d 314, 326 (2002); VXI Lux Holdco S.A.R.L. v. SIC Holdings, LLC, 171 A.D.3d 189, 193 (1st Dep’t 2019). The court may not consider defendant’s affidavit denying her conduct. Serao v. Bench-Serao, 149 A.D.3d 645, 646 (1st Dep’t 2017); Calpo-Rivera v. Siroka, 144 A.D.3d 568, 568 (1st Dep’t 2016); Asmar v. 20th & Seventh Assoc., LLC, 125 A.D.3d 563, 564 (1st Dep’t 2015); City of New York v. VJHC Dev. Corp., 125 A.D.3d 425, 426 (1st Dep’t 2015).

Defendant moves to dismiss each of plaintiffs’ claims: (1) unlawful eviction, (2) nuisance and harassment, (3) personal injury, (4) intentional infliction of emotional distress, (5) damage to Ervin Mrishaj’s leasehold, and (6) tortious interference with a contract or business relations. C.P.L.R. §§3211(a)(1) and (7). The court grants defendant’s motion in part as follows.

III. PLAINTIFFS’ UNLAWFUL EVICTION CLAIM

New York Real Property Actions and Proceedings Law (R.P.A.P.L.) §853 provides a cause of action for unlawful eviction, which allows plaintiffs to recover treble damages, if defendant forcibly or unlawfully disseized, ejected, or removed plaintiffs from real property. Although the removal need not be forcible, the amendment adding unlawful as an alternative to forcible means was intended to remedy a lessor’s other, nonforcible, but physical impediments to lessees’ possession of real property, such as changing the door locks or removing the lessees’ personal property when the lessees are away from the premises. Hood v. Koziej, 140 A.D.3d 563, 565 (1st Dep’t 2016); Mayes v. UVI Holdings, 280 A.D.2d 153, 160 (1st Dep’t 2000).

The complaint alleges that defendant’s repeated banging on her ceiling below plaintiffs’ apartment and her screaming of profanities, frightening the children and interrupting plaintiffs’ sleep, caused plaintiffs to leave their apartment after several months. Plaintiffs do not allege that defendant deprived them of access to their apartment. Weiss v. Bretton Woods Conominium II, 203 A.D.3d 1100, 1102 (2d Dep’t 2022). They still owned and were allowed to use their apartment. Instead, plaintiffs decided to leave their apartment because defendant caused the conditions to become intolerable, akin to a constructive eviction, which does not qualify as a violation of R.P.A.P.L. §853. Moreover, like constructive eviction, an eviction in violation of R.P.A.P.L. §853 applies to lessor-lessee disputes. Barash v. Pennsylvania Term. Real Estate Corp., 26 N.Y.2d 77, 82 (1970); 7001 E. 71st St., LLC v. Millenium Health Servs., 138 A.D.3d 573, 573 (1st Dep’t 2016); Schwartz v. Hotel Carlyle Owners Corp., 132 A.D.3d 541, 542 (1st Dep’t 2015); Pacific Coast Silks, LLC v. 247 Realty, LLC, 76 A.D.3d 167, 172 (1st Dep’t 2010). Section 853 is designed to safeguard the rights of lessees against their lessors, not against neighboring lessees. No authority discloses the statute’s application outside a lessor-lessee dispute.

In opposition to defendant’s motion, plaintiffs emphasize their allegation that on June 22, 2022, defendant admitted to evicting them, but again plaintiffs do not allege that defendant actually removed them or their personal property from their apartment or otherwise deprived them of their ownership or possession of their apartment. Although R.P.A.P.L. §853 does not require that defendant forcibly removed them or their personal property or forcibly changed their apartment door lock, the statute at minimum requires unlawful conduct. Hood v. Koziej, 140 A.D.3d at 566; Rocke v. 1041 Bushwick Ave. Assoc., Inc., 169 A.D.2d 525, 525 (1st Dep’t 1991). Her mere claim that she evicted plaintiffs was not unlawful. Therefore, absent allegations of a physical, unlawful removal, plaintiffs fail to state a claim for unlawful eviction.

IV. NUISANCE AND HARASSMENT

A private nuisance claim requires factual allegations that defendant’s action or omission substantially, intentionally, and unreasonably interfered with plaintiffs’ right to use and enjoy real property. Domen Holding Co. v. Aranovich, 1 N.Y.3d 117, 123 (2003); Copart Indus., Inc. v. Consolidated Edison Co. of New York, Inc., 41 N.Y.2d 564, 568 (1977); O’Hara v. Board of Directors of the Park Ave. & Seventy-Seventh St. Corp., 206 A.D.3d 476, 477 (1st Dep’t 2022). Defendant’s objectionable conduct must be continuous or recurring. Domen Holding Co. v. Aranovich, 1 N.Y.3d at 123; Berenger v. 261 W. LLC, 93 A.D.3d 175, 182 (1st Dep’t 2012); Chelsea 18 Partners, LP v. Sheck Yee Mak, 90 A.D.3d 38, 41 (1st Dep’t 2011).

Plaintiffs’ allegations show that defendant engaged in continuous and recurring conduct that interfered with their sleep and enjoyment of their apartment. Therefore the court denies defendant’s motion to dismiss plaintiffs’ nuisance claim. O’Hara v. Board of Directors of the Park Ave. & Seventy-Seventh St. Corp., 206 A.D.3d at 477. The court dismisses plaintiffs’ claim for harassment, however, as “New York does not recognize a common-law cause of action for harassment.” Garza v. Nunz Realty, LLC, 187 A.D.3d 467, 467 (1st Dep’t 2020)(quoting Edelstein v. Farber, 27 A.D.3d 202, 202 (1st Dep’t 2006)).

V. PERSONAL INJURY

Plaintiffs vaguely allege a claim for “personal injury” without further specification. Plaintiffs insisted at oral argument, however, that their allegations support claims for both assault and a prima facie tort. To establish assault, plaintiffs must show physical conduct causing their apprehension of immediate harmful contact. Waterbury v. New York City Ballet, Inc., 205 A.D.3d 154, 166 (1st Dep’t 2022); Corcoran v. City of New York, 186 A.D.3d 1151, 1151 (1st Dep’t 2020). Yet the verified complaint and plaintiffs’ affidavits, at best, describe only their apprehension of defendant’s disturbing loud noise and profanities. Plaintiffs nowhere describe any threat of immediate physical harm: that defendant was about to strike through the ceiling or through plaintiffs’ door into their apartment or attack plaintiffs elsewhere in the building, for example. Waterbury v. New York City Ballet, Inc., 205 A.D.3d at 166; Corcoran v. City of New York, 186 A.D.3d at 1151; Joon Song v. MHM Sponsors Co., 176 A.D.3d 572, 573 (1st Dep’t 2019).

To establish a prima facie tort, plaintiffs must show (1) intentional infliction of harm, (2) causing special damages, in the form of a specific, measurable loss, (3) without justification or excuse, (4) by otherwise lawful acts. Posner v. Lewis, 18 N.Y.3d 566, 570 n.1 (2012); Freihofer v. Hearst Corp., 65 N.Y.2d 135, 142-43 (1985); Curiano v. Suozzi, 63 N.Y.2d 113, 117 (1984); Burns Jackson Miller Summit & Spitzer v. Lindner, 59 N.Y.2d 314, 332 (1983). Although plaintiffs allege that they lost their apartment, they do not specify that they sold it for less than their investment in it or that they could not find a comparable apartment for the same price. Lewis v. Pierce Bainbridge Beck Price Hecht LLP, 195 A.D.3d 518, 519 (1st Dep’t 2021); Hakim v. James, 169 A.D.3d 450, 452 (1st Dept 2019); Britt v. City of New York, 151 A.D.3d 606, 607 (1st Dep’t 2017); Wigdor v. SoulCycle, LLC, 139 A.D.3d 613, 614 (1st Dep’t 2016). Even if plaintiffs’ loss of their apartment constitutes special damages, however, their allegations about defendant’s conduct, particularly her admission that she effected plaintiffs’ eviction, demonstrate that she acted out of a motive to evict plaintiffs, rather than pure disinterested malevolence. Hakim v. James, 169 A.D.3d at 452; Britt v. City of New York, 151 A.D.3d at 607; AREP Fifty-Seventh, LLC v. PMGP Assoc., L.P., 115 A.D.3d 402, 403 (1st Dep’t 2014). Last, plaintiffs’ prima facie tort claim duplicates their claim for intentional infliction of emotional distress. Maak v. Medina Professional Firefighters Assn., IAFF Local 2161, 186 A.D.3d 1016, 1017 (4th Dep’t 2020). Therefore the court grants defendant’s motion to dismiss plaintiffs’ claim for “personal injury,” regardless whether it suggests a claim for assault or a prima facie tort.

VI. INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS

A claim for intentional infliction of emotional distress requires plaintiffs to demonstrate (1) that defendant engaged in extreme and outrageous conduct, (2) with intent to cause or in disregard of a substantial probability that such conduct would cause severe emotional distress, (3) a causal connection between defendant’s acts and plaintiffs’ injury, and (4) severe emotional distress. Chanko v. American Broadcasting Cos. Inc., 27 N.Y.3d 46, 56 (2016); Silverman v. Park Towers Tenants Corp., 206 A.D.3d 417, 418 (1st Dep’t 2022); Waterbury v. New York City Ballet, Inc., 205 A.D.3d at 165. In particular, plaintiffs must show that defendant’s conduct was “beyond all possible bounds of decency” and “utterly intolerable in a civilized community.” Chanko v. American Broadcasting Cos. Inc., 27 N.Y.3d at 56; Marmelstein v. Kehillat New Hempstead: The Rav Aron Jofen Community Synagogue, 11 N.Y.3d 15, 23 (2008).

Plaintiffs allege that defendant intentionally harassed them from within her apartment by constantly shouting profanities and loudly striking her ceiling, which disrupted plaintiffs’ sleep and adversely affected their health, for over four months, with the objective of evicting them. They allege that defendant yelled the profanities despite her knowledge of the young children residing in the apartment and that her conduct traumatized at least one child. Tropoj Mrishaj attests that, when defendant banged on her ceiling and shouted at plaintiffs, their child ran to her mother screaming and crying and suffered long term effects from these repeated episodes. She refused to sleep or play alone. At night she frequently woke up terrified by nightmares. Every day she threw tantrums. She became too distracted to focus and learn and changed from happy and friendly to angry and distant. Assuming these allegations to be true, they describe a campaign of indecent, intolerable, and uncivilized conduct intended to be offensive and causing severe mental and physical harm to at least one child that satisfies the high bar of an intentional infliction of emotional distress claim. Silverman v. Park Towers Tenants Corp., 206 A.D.3d at 418; Waterbury v. New York City Ballet, Inc., 205 A.D.3d at 165.

In support of the motion, defendant presents text messages indicating an amicable relationship between plaintiffs and defendant. Even assuming that defendant offers this unsworn hearsay to show plaintiffs’ state of mind and not impermissibly for the truth of the messages, they do not constitute “documentary evidence” that may support defendant’s motion. C.P.L.R. §3211(a)(1); Kalaj v. 21 Fountain Place, LLC, 169 A.D.3d 657, 658 (2d Dep’t 2019). They do not completely refute plaintiffs’ allegations, since they do not encompass every interaction between the parties from November 5, 2021, to March 25, 2022. Rosario v. Hallen Constr. Co., Inc., 214 A.D.3d 544, 544 (1st Dep’t 2023); Whitestone Constr. Corp. v. F.J. Sciame Constr. Co. Inc., 194 A.D.3d 532, 534 (1st Dep’t 2021). As Ervin Mrishaj explains, the text messages predated plaintiff’s move into their apartment or reflect his diplomatic efforts early in their tenancy to appease defendant and diffuse the tension. Therefore the court denies defendant’s motion to dismiss plaintiffs’ claim for intentional infliction of emotional distress.

VII. DAMAGE TO THE LEASEHOLD

The court considers plaintiffs’ claim for damage to their leasehold abandoned, as they did not oppose defendant’s motion to dismiss this claim. Disla v. Biggs, 191 A.D.3d 501, 501 (1st Dep’t 2021); Burgos v. Premiere Properties, Inc., 145 A.D.3d 506, 508 (1st Dep’t 2016). Moreover, this claim merely reiterates that defendant’s conduct impaired use of their apartment, which duplicates their private nuisance claim. Therefore the court grants defendant’s motion to dismiss plaintiffs’ claim for damage to their leasehold.

VIII. TORTIOUS INTERFERENCE WITH A CONTRACT OR BUSINESS RELATIONS

Plaintiffs’ final claim alleges that defendant caused the cooperative to issue a notice of termination to plaintiffs, but they admit that the cooperative did not actually evict them. Thus plaintiffs fail to substantiate how they were injured as a result of defendant’s alleged interference with plaintiffs’ contract or other relationship with the cooperative, Joon Song v. MHM Sponsors Co., 176 A.D.3d at 572, which warrants dismissal of this claim as well.

IX. CONCLUSION

Finally, plaintiffs claim disclosure will defeat dismissal of claims that currently fail. C.P.L.R. §3211(d). The evidence plaintiffs expect to present, however, is not from defendant, but is from plaintiffs’ own experts, which plaintiff were free to present now in opposition to dismissal. Nor do plaintiffs suggest what claims plaintiffs’ experts would support other than intentional infliction of emotional distress, which already survives.

Consequently, for the reasons explained above, the court grants defendant’s motion to dismiss plaintiffs’ claims except their claims for private nuisance and intentional infliction of emotional distress. C.P.L.R. §3211(a)(1) and (7). Defendant shall answer the remaining claims in the complaint within 10 days after service of this order with notice of entry. C.P.L.R. §3211(f). The parties shall attend a Preliminary Conference via video July 18, 2023, at 11:00 a.m. This decision constitutes the court’s order.

Dated: June 12, 2023

THE POWER OF THE CO-OP BOARD AND THE BUSINESS JUDGMENT RULE

 

MATTER OF SCHULTE, 2022 NY Slip Op 34000 - NY: Surrogate's Court, New York 2022:

"As this court held in its April 2016 decision, the Board's determination of the request to transfer the shares here was governed by the business judgment rule which prohibits judicial inquiry into cooperative board actions "taken in good faith and in the exercise of honest judgment in the lawful and legitimate furtherance of corporate purposes" (Gonzalez v Been, 145 AD3d 434, 435 [1st Dept 2016]). To permit general, but non-discriminatory, assertions of dislike of a possible transferee of cooperative shares (or here, a possible resident as a beneficiary of a trust to which the shares were to be transferred) to form the basis for a claim of bad faith if a board fails to approve a share transfer would change the business judgment rule beyond recognition. Here, Sandra has provided no authority for such a dramatic alteration of the rule and the court is aware of none that supports her view (see Cahill v Jordan Home Services, LLC, 145 AD3d 847 [2d Dept 2016] [legally unviable claim properly denied as pleading amendment]).^[5] Because Sandra did not seek to add allegations supporting a conclusion of improper or discriminatory conduct, but merely personal dislike of her individually as a nonshareholder, and in light of the prejudicial delay noted above, the court accordingly denied her leave to amend the cross-claim.

The motion for summary judgment by 1125 Park sought an order dismissing the Executor's original cross-claim, which sounded in breach of fiduciary duty based on improper favoritism towards a Board member who was interested in purchasing decedent's shares. As the court held on the record on April 20, 2021, on this issue, 1125 Park established, prima facie, its entitlement to judgment as a matter of law (see Zuckerman v City of New York, 49 NY2d 557 [1980] [setting forth the summary judgment standard]), by offering admissible evidence that 1125 Park's Board had no knowledge that a Board member desired to purchase the shares allocated to decedent's apartment.^[6] Thus, 1125 Park demonstrated that, even if a member of the Board had wanted to purchase decedent's shares, such fact could not have had an impact on the Board's decision to deny the transfer of the shares to the Trust (see Park Royal Owners, Inc. v Glasgow, 19 AD3d 246 [1st Dept 2005]). In opposition, despite discovery on this issue, Sandra failed to provide evidence raising a material question of fact that the Board sought to favor such member improperly. Her self-serving speculation and conclusory allegations are insufficient to forestall summary dismissal of the cross-claim (see e.g. Schloss v Steinberg, 100 AD3d 476 [1st Dept 2012]; Beer Sheva Realty Corp. v Ponjnitayapanu, 214 AD2d 352 [1st Dept 1995]; X.L.O. Concrete Corp. v O'Connor, 183 AD2d 487 [1st Dept 1992])."

NEIGHBOR DISPUTE - A SUIT AGAINST NOISY NEIGHBORS AND CO-OP

O'HARA v. BOARD OF DIRECTORS OF THE PARK AVE. & SEVENTY-SEVENTH ST. CORP., 2022 NY Slip Op 3872 - NY: Appellate Div., 1st Dept. 2022:

"Plaintiffs allege that unreasonable noise and stomping by the Lazars' children in the upstairs apartment directly above them adversely affected plaintiff Robert O'Hara, Jr.'s health and created structural cracks in the walls and ceiling of their unit. They allege further that the Co-op defendants failed to investigate and address the noise and structural damage.

The allegations concerning the noise are sufficient to state a cause of action for nuisance against the Lazars, as are the allegations of physical damage to the walls and ceiling (see Copart Indus. v Consolidated Edison Co. of N.Y., 41 NY2d 564, 570 [1977]).

The cause of action for breach of contract against the Lazars was correctly dismissed, since there is nothing in the Lazars' proprietary lease that indicates that plaintiffs were intended third-party beneficiaries of the lease (see Ran v Weiner, 170 AD3d 425, 425-426 [1st Dept 2019]).

The complaint alleges that the Co-op board's refusal to investigate plaintiffs' concerns about the noise constituted unequal treatment and a dereliction of the directors' duties. However, because it does not allege that, in refusing to investigate, the directors were acting outside their official capacity, the complaint fails to state a cause of action for breach of fiduciary duty (Peacock v Herald Sq. Loft Corp., 67 AD3d 442, 442 [1st Dept 2009]; see also Frankel v Board of Mgrs. of the Cent. Park W. Condominium, 177 AD3d 465, 467 [1st Dept 2019]).

The complaint states a cause of action for breach of article I, paragraph first of the proprietary lease, which requires the Co-op to maintain all structural parts of the building, including the apartment's walls and ceilings. To the extent the Co-op defendants contend that under the exculpatory clauses of the proprietary lease, they are not responsible for breaches by other shareholders of the cooperative, this argument is unavailing. The owner of a multiple dwelling has a nondelegable duty to maintain the building in good repair under Administrative Code of the City of New York § 27-2005(a), which applies irrespective of the source of the damage to the structural elements of the building.

The complaint fails to state a cause of action for breach of article I, paragraph second of the proprietary lease, because it does not allege that the Co-op failed to provide any of the enumerated services required to maintain the building in first-class condition. To the extent the claim is predicated on the Lazars' alleged violation of the house rules, it is barred by article II, paragraph fifth, which shields the Co-op from liability to one shareholder for another shareholder's violation of the rules (see e.g. Ran, 170 AD3d at 426).

The complaint fails to allege an eviction or abandonment sufficient to support a claim for breach of article I, paragraph seventh of the proprietary lease, which incorporates the covenant of quiet enjoyment (see Iken v Bohemian Brethren Presbyt. Church, 162 AD3d 594, 595 [1st Dept 2018]).

As to the claim for breach of the warranty of habitability, the allegations concerning the noise do not establish that the noise was so excessive that it deprived plaintiffs of the essential functions of a residence (see Kaniklidis v 235 Lincoln Place Hous. Corp., 305 AD2d 546, 547 [2d Dept 2003]). However, the allegations concerning the Co-op defendants' refusal to repair the structural cracks in the ceiling and walls state a claim for breach of the warranty, since structural cracks could give rise to a hazardous condition of the building (see Park W. Mgt. Corp. v Mitchell, 47 NY2d 316, 327-328 [1979], cert denied 444 US 992 [1979])."

REVERSE MORTGAGES AND CO-OPS

A new law permitting reverse cooperative apartment unit loans for persons seventy years of age or older was signed by the Governor on December 1, 2021 to be effective in 180 days therein:

"BILL NUMBER: S760

SPONSOR: BIAGGI
 
TITLE OF BILL:

An act to amend the banking law, the uniform commercial code and the
civil practice law and rules, in relation to reverse cooperative apart-
ment unit loans

 
PURPOSE:

This bill would give owners of co-op apartments who are over the age of
62 the ability to obtain reverse mortgages on their cooperative apart-
ment unit loans.

 
SUMMARY OF PROVISIONS:

Section 1 amends the banking law by adding a new section, 6-n providing
definitions for reverse cooperative apartment unit loan, loan payout
options, authorized lender, borrower, superintendent, department, and
third-party contact.

Subsection 2 of section 1 states what the cooperative apartment unit
loan would be subject to.

Subsection 3 of section 1 explains what a reverse cooperative apartment
unit loan may do.

Subsection 4 of section 1 states that the superintendent shall adopt the
rules and regulations as it considers appropriate to govern reverse
cooperative apartment unit loan if it conforms to the requirements of
the section, and explains the requirements to authorize a reverse coop-
erative apartment unit loan.

Subsection 5 of section 1 prohibits authorized lenders from any unfair
or deceptive practices when marketing or offering reverse cooperative
unit loans, including using language "public service announcement," or
"government insured," or any similar language; nor can they represent
the loan as anything other than a commercial product.

Subsection 6 of section 1 requires authorized lenders to include supple-
mental consumer protection materials deemed appropriate by the super-
intendent alongside any solicitation for reverse cooperative unit loan
products mailed to a physical address within the state.  Lenders are
also required to provide applicants or potential applicants with the
telephone number and website (HUD).

Subsection 7 of section 1 requires authorized lenders and their agents
provide monthly account statements with specified requirements in addi-
tion to notice of information requirements regarding clients home equity
line of credit.

Subsection 8 of section 1 states that upon a lender's determination that
a reverse cooperative apartment unit loan is in default and before a
lender can take up action to foreclose, they must call or visit the
borrower, the lender must provide clear information about the intent of
the call or visit and then wait 30 days after successful contact with
the borrower. Once these steps are taken, the lender may act on the
foreclosure process.
Subsection 9 of section 1 sets the priority of the lien.

Subsection 10 of section 1 states that any other mortgage, deed of
trust, encumbrance or lien filed prior to the effective date of this
section shall not be limited.

Subsection 11 of section 1 if the reverse cooperative unit loan is sold
or transferred to a person other than the original borrower, the reverse
loan shall be terminated.

Subsection 12 of section 1 sets a person's ability to bring an action.

Subsection 13 of section 1 sets conditions for a complete defense.

Section 2 adds a new paragraph 1-a to subsection (f) of section 9-611 of
the uniform commercial code which states that upon default of a reverse
cooperative apartment unit loan, a notice shall be given to the borrower
at least 45 days in advance of an agent disposing of its collateral.

Section 3 adds a new rule 3410 to civil practice law and rules pertain-
ing to face-to-face meetings for foreclosure of reverse cooperative
apartment unit loans.

Section 4 states that the superintendent of financial services shall
convene a working group comprised of industry and consumer represen-
tatives to study the availability of reverse mortgage counselors.

Section 5 sets forth the effective date.

 
JUSTIFICATION:

As of today, HUD continues to deny co-op owners from applying for
reverse cooperative apartment unit loans. With the correct regulations
and liability protection, aging populations should be permitted to
obtain such loans, instead of being forced to relocate from their homes.

With this bill, extended consumer protections will be added to the proc-
ess of acquiring a reverse cooperative apartment unit loan and will
ensure that the elderly community that so desperately wishes to stay in
their homes will be able to do so."

BILL SIGNED - CO-OPS AND THE 2019 ACT

On December 22, 2021, Governor Kathy Hochul signed into law amendments to the 2019 Housing Stability Tenant Protection Act, which previously imposed a number of restrictions on the operations of cooperative apartment corporations. The amendments are effective immediately.

The amendments are detailed to in an earlier post: A BILL NOT YET SIGNED - CO-OPS AND THE 2019 ACT

As noted by one counsel, cooperative boards may, subject to the terms of the cooperative proprietary lease:

"1. Condition their approval of purchase applications upon the posting of a maintenance escrow;

2. Charge application, processing and search fees as determined in the board’s discretion;

3. Impose late fees in an amount up to (but not to exceed) 8% of a delinquent shareholder’s monthly maintenance charge;

4. Seek to collect late fees, legal fees and other expenses related to shareholder defaults in any non-payment action the apartment corporation may bring; 

5. Send delinquency notices by any method consistent with the terms of the cooperative proprietary lease; and

6. Seek the reimbursement of legal fees in connection with obtaining a default judgment against delinquent shareholders. "

A BILL NOT YET SIGNED - CO-OPS AND THE 2019 ACT

Does the 2019 Housing Stability Act apply to co-op leases? And what about when a co-op owner subleases his unit with Board approval?

Although this bill was passed by both the New York State Assembly and Senate, as of yet, it has not yet been signed by the governor, having just been delivered on December 10:

"BILL NUMBER: S5105C

SPONSOR: LIU
 
TITLE OF BILL:

An act to amend the general obligations law, the real property law, and
the real property actions and proceedings law, in relation to excluding
tenant-shareholders in cooperative housing corporations from certain
housing provisions

 
JUSTIFICATION:

The Housing Stability and Tenant Protection Act of 2019 was a landmark
bill in protecting tenant rights. However, several provisions of the
bill were unclear regarding its application to shareholder-tenants who
òutilize their cooperative as their residence. This bill adds clarifying
language and exempts these homeowner shareholder-tenants from those
provisions that would have a negative impact to their homeownership.

 
LEGISLATIVE HISTORY:

 
FISCAL IMPLICATIONS:

None

 
EFFECTIVE DATE:
This act shall take effect immediately and shall apply to actions and
proceedings commenced on or after such effective date."

LANDLORD/TENANT - USE AND OCCUPANCY

Tavor v Lane Towers Owners, Inc., 2021 NY Slip Op 04676, Decided on August 11, 2021, Appellate Division, Second Department:

"The plaintiff is the proprietary lessee of two cooperative apartments in Queens. He owns shares of stock in the defendant Lane Towers Owners, Inc. (hereinafter Lane Towers), the cooperative housing corporation which owns the building where the subject apartments are located.

In November 2013, the plaintiff and Lane Towers entered into an agreement which provided, inter alia, that the plaintiff would receive a maintenance credit until certain repairs were completed by Lane Towers. Lane Towers credited the plaintiff's maintenance payments through November 30, 2015, when it asserted that it finished making the requisite repairs. Thereafter, Lane Towers advised the plaintiff that he was in breach of the proprietary leases based on his default in tendering his monthly maintenance payments.

In January 2017, the plaintiff commenced this action, inter alia, to recover damages [*2]for breach of contract, alleging, among other things, that the repairs had not been completed as required by the November 2013 agreement. In July 2018, the defendant Board of Directors of Lane Towers Owners, Inc. (hereinafter the Board), moved for an award of use and occupancy pendente lite. The plaintiff cross-moved for leave to amend the complaint and to disqualify the Board's counsel.

In an order dated February 6, 2019, the Supreme Court granted the Board's motion, and directed the plaintiff to pay the sum of $119,121.38 for past use and occupancy and to pay prospective use and occupancy during the pendency of this action, and denied the plaintiff's cross motion. By order dated July 9, 2019, the court, upon reargument, adhered to the original determination in the February 6, 2019 order. The plaintiff appeals.

Contrary to the plaintiff's contentions, the obligation to pay for use and occupancy does not arise from an underlying contract between the landlord and the occupant. Rather, "'an occupant's duty to pay the landlord for its use and occupancy of the premises is predicated upon the theory of quantum meruit, and is imposed by law for the purpose of bringing about justice without reference to the intention of the parties'" (Matter of First Am. Tit. Ins. Co. v Cohen, 163 AD3d 814, 816, quoting Eighteen Assoc. v Nanjim Leasing Corp., 257 AD2d 559, 560; see 255 Butler Assoc., LLC v 255 Butler, LLC, 173 AD3d 651, 654).

Here, considering the plaintiff's continued use and occupancy of the apartments and the work performed by Lane Towers, the Supreme Court providently exercised its discretion in directing the plaintiff to pay for his use and occupancy of the apartments during the pendency of this action. Since this is a pendente lite award, the details of the financial equities can be remedied "by means of a speedy trial of the action" (Getty Props. Corp. v Getty Petroleum Mktg. Inc., 106 AD3d 429, 430 [internal quotation marks omitted])."

COVID, CO-OPS...AND MASKS

Rush Props. v. Riveros, Date filed: 2021-06-15, Court: Supreme Court, Nassau, Judge: Justice Thomas Rademaker, Case Number: 601909/2021:

"DECISION/ORDER The Plaintiff moves by Order to Show Cause for an Order of the Court which seeks, inter alia, to enjoin Defendant Dawn Riveros, her agents, servants, tenant(s), guests and any other occupants of the premises located at 157 Hempstead Avenue, Apartment 12C, Lynbrook, NY 11.563 (“the Premises”) from entering and/or utilizing common areas of the Cooperative (hereinafter “Co-op”) Building without wearing a face covering/mask; 2) compel Defendant Riveros to wear a face covering/mask whenever in the Go-Op building’s common areas, and 3) award the Plaintiff attorney’s fees, costs, and disbursements incurred in connection with its application. The Respondent did not file opposition to this Order to Show Cause. The Plaintiff, Rush Properties LLC, is a New York limited liability company, and at all times mentioned, was both a shareholder/tenant of a certain cooperative apartment located at 157 Hempstead Avenue, Apt. 12C, Lynbrook, New York. The Plaintiff entered into a written lease agreement with the Defendant for a one-year term, beginning October 1, 2018, and ending on September 30, 2019. This lease was extended by a one-year term beginning October 1, 2019, and ending September 30, 2020, by a written agreement dated July 25, 2019. The lease requires the Defendant to comply with “all laws, orders, rules, requests, and directions, of all governmental authorities” and that the “comfort or rights of other [t]enants must not be interfered with.” The lease also provides that the tenant understands that she is renting an apartment in a Co-op building, and that the lease is subject to the Co-op Offering Plan and Amendments, Proprietary Lease, House Rules, and any other governing Co-op documents.

The Plaintiff contends that on numerous occasions the Defendant entered common areas of the Cooperative apartment building without wearing a face mask or facial covering and that such behavior was in derogation of the regulations promulgated by the state of New York to combat the spread of the COVID-19 virus. The Plaintiff further contends that such behavior resulted from complaints by other tenants in the Co-op apartment and that by refusing to wear a face mask or facial covering the Defendant has placed the health and safety of other residents at risk, and therefore is in violation of the express and implied terms of her tenancy.

On or about February 17, 2021, the Plaintiff filed a summons and complaint against the Defendant in which the Plaintiff seeks, inter alia, a mandatory injunction directing and compelling the Defendant to wear a face covering/mask whenever in the Co-Op building’s common areas; judgment that the Defendant has violated her lease; costs, expenses, disbursements and attorney’s fees incurred in connection with asserting this action; a money in an amount to be determined at trial, but believed to be in excess of $40,000; and an Order ejecting Defendant from the Premises and immediately restoring Plaintiff to possession of the Premises and awarding the Plaintiff damages.

In moving for injunctive relief by Order to Show Cause, the Plaintiff contends that it is essentially acting in response to complaints from the cooperative board and other residents and seeks to take corrective action against its tenant.

A cooperative or condominium association is quasi-governmental and can be considered a democratic sub-society of necessity. (Levandusky v. One Fifth Ave. Apt. Corp., 75 NY2d 530, 533 [1990]). The proprietary lessees or condominium owners consent to be governed, in certain aspects, by the decisions of a board. Like a municipal government, such governing boards are responsible for running the day-to-day affairs of the cooperative and to that end, often have broad powers in areas that range from financial decision making to promulgating regulations regarding pets and parking spaces. Authority to approve or disapprove structural alterations is commonly given to the governing board. (Id.)

Even when the governing board acts within the scope of its authority, some check on its potential powers to regulate residents’ conduct, life-style, and property rights is necessary to protect individual residents from abusive exercise, notwithstanding that the residents have, to an extent, consented to be regulated and even selected their representatives. These goals are best served by a standard of review that is analogous to the business judgment rule applied by courts to determine challenges to decisions made by corporate directors (Levandusky v. One Fifth Ave. Apt. Corp., 75 NY2d 530, 533 [1990]).

A governing board owes its duty of loyalty to its cooperative — that is, it must act for the benefit of the residents collectively. So long as the board acts for the purposes of the cooperative, within the scope of its authority and in good faith, courts will not substitute their judgment for the board. Stated somewhat differently, unless a resident challenging the board’s action is able to demonstrate a breach of this duty, judicial review is not available. (Levandusky v. One Fifth Ave. Apt. Corp., 75 NY2d 530, 533 [1990]). The very concept of cooperative living entails a voluntary, shared control over rules, maintenance, and the composition of the community. Indeed, as the Court of Appeals observed in Levandusky, a shareholder-tenant voluntarily agrees to submit to the authority of a cooperative board, and consequently the board “may significantly restrict the bundle of rights a property owner normally enjoys.” (Levandusky, 75 N.Y.2d at 536).

However, when dealing with termination, courts must exercise a heightened vigilance in examining whether the board’s action meets the Levandusky test. (40 W, 67th St. Corp. v. Pullman, 100 NY2d 147, 158 [2003]). “While deferential, the Levandusky standard should not serve as a rubber stamp for cooperative board actions, particularly those involving tenancy terminations.” (Id. at 157.) The Pullman Court found that in the case before it, “the cooperative unfailingly followed the procedures contained in the lease when acting to terminate defendant’s tenancy.” (Id. at 156.) In particular, the Pullman Court noted that the Board had called a special meeting and given the defendant an opportunity to be heard; acted by super majority vote; properly fashioned the issue and the question to be addressed by resolution; and enacted a resolution which “specified the basis for the action, setting forth a list of specific findings as to defendant’s objectionable behavior.” (320 Owners Corp. v. Harvey, 2008 NY Slip Op 32796[U], *4-5 [Sup Ct, NY County 2008])

On March 7, 2020, the Governor of the State of New York issued Executive Order Number 202 (hereinafter “Executive Order 202″) which declared a State disaster emergency and exercised disaster emergency powers necessary to cope with the COVID-19 pandemic and public health crises. Subsequently, Executive Order 202 was followed by Executive Order 202.17, which required “any individual over the age of two and able to medically tolerate a face-covering” was to be “required to cover their nose and mouth with a mask or cloth face-covering when in a public place and unable to maintain…social distance.” (N.Y. Exec. Order No. 202.17 [Effective Date April 17, 2020]).

With respect to COVID-19 response, Co-op boards are and have been confronted by significant considerations when implementing, applying, and enforcing social distancing guidelines within their communities, particularly in common areas. Some Co-op boards “have moved to require a face covering in all common areas in their buildings.” Thus, if an individual fails to wear a face mask, that would “be a violation of the law, and therefore, a breach of the proprietary lease.” The one exception to this is if “the individual cannot medically tolerate a face covering.” (Phyllis Weisberg, Q&A: Cover Your Face or Face a Fine, Cooperator New York (July 2020], available at https//cooperatornews.com/article/qa-cover-your-face-or-face-a-fine [Last accessed June 15, 2021]).

Under recent New York State guidelines, a Co-op board may be presented with two choices. First, the board can “continue with the Board’s current COVID-19 policy.” Second, a board can “adopt a new COVID-19 policy following the May 13, 2021 CDC Recommendations.” (Considerations for Co-Ops and Condos in Light of New CDC Recommendations, Armstrong Teasdale [May 21, 2021 available at https://www.armstrongteasdale.com/thought-leadership/considerations-for-co-ops-and-condos-in-light-of-new-cdc-recommendations.'last accessed June 15, 2021]).

Under the first option, the Co-op board can “continue to utilize the current system it has established for social distancing and masks for residents, staff contractors, and visitors, without regard to their vaccination status.” (Id.) This is the more conservative approach and can be “changed at any time in the future.” (Id.) Under the second option, a Co-op board can adopt the May 13, 2020 CDC Rules, which permit “fully vaccinated people” to forgo masks and social distancing requirements, but requires unvaccinated people to continue to wear facial coverings and practice social distancing. (Id.)

The instant action was filed prior to the widespread availability of vaccines to the general population. COVID-19 response involves an ever evolving Federal and New York regulatory environment, which becomes less restrictive as more individuals become vaccinated. (See Emma Kinery, “Cuomo Lifts N.Y. Covid Mandates After Reaching 70 percent Vaccine Goal,” Bloomberg June 15, 2021[http://www.bloomberg.com/news/articles/2021-06-15/cuomo-lifts-n-v-covid-mandates-after-reaching-70-vaccine-goal])

On a motion for a preliminary injunction, the moving party must demonstrate by clear and convincing evidence a likelihood of ultimate success on the merits, irreparable injury if the injunction were not granted, and a balancing of equities in favor of granting the injunction. (Nobu Next Door, LLC v. Fine Arts Hous., Inc., 4 NY3d 839 [2005]; Aetna Ins. Co. v. Capasso, 75 NY2d 860 [1990]). If any one of these three requirements are not satisfied, the motion must be denied. (Faberge Intern., Inc. v. Di Pino, 109 AD2d 235 [1st Dept. 1985]). An injunction is a provisional remedy to maintain the status quo and prevent the dissipation of property that could render a judgment ineffectual. However, it is not to determine the ultimate rights of the parties. As such, absent extraordinary circumstances, a preliminary injunction will not issue where to do so would grant the movant the ultimate relief sought in the complaint. (Reichman v. Reichman, 88 AD3d 680 [2nd Dept. 2011]); (SHS Baisley, LLC v. Res Land, Inc., 18 AD3d 727 [2nd Dept. 2005]). In addition, preliminary injunctions should not be granted absent extraordinary or unique circumstances or where the final judgment may otherwise fail to afford complete relief. (Matter of Lasertron Inc. v. Empire State Dev. Corp., 70 Misc 3d 1085, 1092 [Sup Ct, Erie County 2021])

The movants herein request that the Court exercise its equitable powers and compel the Defendant to wear a mask or facial covering. It is a familiar principle that a court of equity, having obtained jurisdiction of the parties and the subject matter of the action, will adapt its relief to the exigencies of the case. (Valentine v. Richardt, 126 NY 272 [1891]), and that an equitable award may be available to “prevent a failure of justice.” (Barker v. Sabato, 251 AD 834 [2nd Dept 1937]). Ultimately, however, the decision to grant or deny a preliminary injunction rests in the sound discretion of the Court. (Matter of Buffalo Teachers Fedn. Inc v. Board of Educ. of the City School District of the City of Buffalo, 71 Misc3d 289 [Sup Ct. Erie County 2021]).

COVID-19 social distancing and face covering requirements constitutes an ever evolving regulatory scheme, and other than several emails complaints from other tenants, which must be considered hearsay by the Court, the Plaintiff has not presented evidence in admissible form that the Defendant’s conduct has risen to a level of a threat to public health. Furthermore, granting an order which requires the tenant to wear a facial covering fails to take into consideration any potential regulatory changes to COVID-19, and raises the potential that a tenant could remain under continuous order to remain masked, even despite being medically unable to tolerate same, as well as cause that tenant to be subject to limitless future applications for contempt.

Upon a careful review of the affidavit in support of the Plaintiff s motions, and the annexed exhibits thereto, and in the exercise of its discretion, the Court finds the Plaintiff has not sustained the burden of proof necessary to warrant injunctive relief. As a result, the Plaintiff s motion is hereby DENIED in its entirety."

WHEN THE CO-OP BOARD SEEKS TO TERMINATE YOUR LEASE

The lesson here is to be specific in the predicate notice of the acts which constitute a breach of the lease and to make sure the board action is taken pursuant to its by-laws.

Clinton 510 Owners HDFC Inc. v. DiPietro, NYLJ  May 06, 2020, Date filed: 2020-04-10, Court: Civil Court, New York, Judge: Judge Kimon Thermos, Case Number: 58231/19:

"In this nuisance holdover, Petitioner HDFC seeks to regain possession of the subject cooperative apartment from Respondent shareholder after the board of directors decided, by vote, at a special meeting to terminate his tenancy and served a Five (5) Day Notice of Termination dated March 12, 2019. The notice contained a recitation of the purported objectionable conduct, which included an allegation that Respondent consistently subletted the apartment on a short term basis, and had attached a copy of the minutes of the special meeting held on February 28, 2019 which resulted in the termination.

Respondent, by counsel, now moves pre-answer for an Order, pursuant to CPLR §3211(a)(7), dismissing the petition on the grounds that the termination notice is defective, in that it does not contain sufficient facts to establish prima facie nuisance conduct by Respondent and/or that the alleged conduct does not otherwise constitute objectionable conduct in violation of the proprietary lease. Respondent further argues that Petitioner cannot remedy this defect by resorting to the application of the cooperative business judgment rule, where the court must defer to a properly taken “termination of tenancy vote” by the cooperative board, because the action taken by the board of directors terminating the tenancy was done in bad faith since Respondent was not served with notice to attend the special meeting and, therefore, did not the meeting. Additionally, Respondent argues that, in any event, the board’s decision is not binding, since the grounds for termination do not constitute a breach of the lease and, therefore, given this defect, the decision taken by the board was not authorized and is, therefore, a nullity.

Petitioner opposes the motion and cross moves for summary judgment of possession, asserting that the predicate notice is factually sufficient under the law and that, under the prevailing authority, the board’s decision to terminate the proprietary lease, and the grounds upon which it is based, cannot be collaterally challenged herein, since the business judgment rule precludes review of the board’s action by this Court. Petitioner submits that Respondent was properly notified of a hearing that was to be held to discuss the board’s accusations and that Respondent failed to appear. Petitioner avers that, since Respondent did not appear at the fact gathering hearing, there was no obligation to notify him of the special meeting, where only a vote was taken on whether to adopt the committee’s motion to terminate the tenancy for breach of lease and nuisance conduct as delineated in the predicate notice of termination which followed. Petitioner further argues that Respondent’s conduct was objectionable under the terms of the lease and, therefore, the board’s decision to terminate the lease was both authorized and rendered in good faith. In its cross-motion, Petitioner also seeks leave to amend its pleadings to correct the spelling of Respondent’s first name and zip code and to set this matter down for a hearing on legal fees.

DISCUSSION

When considering a motion to dismiss pursuant to CPLR §3211, the court must determine whether the pleadings state a cognizable cause of action or defense. In doing so, the Court must “afford the pleadings a liberal construction, take the allegations in the [pleadings] are true and afford the [pleadings] the benefit of every possible inference”. EBC I, Inc. v. Goldman, Sachs & Co., 5 N.Y.3d 11, 19 (2005). “The motion must be denied if, from the pleadings’ four corners, factual allegations are discerned which taken together manifest any cause of action [or defense] cognizable at law.” 511 West 232nd Owners Corp. v. Jennifer Realty Co., 98 N.Y.2d 144, 152 (2002), quoting Polonetsky v. Better Homes Depot, 97 N.Y.2d 46 (2001).

Cooperative Business Judgment Rule

Petitioner argues that the court cannot scrutinize the termination notice for facial sufficiency because the board is shielded by the business judgment rule; therefore, the court must defer to its finding of grounds for termination as it satisfies the competent evidence rule under RPAPL §711. It is well settled that the decision of a cooperative board of directors to cancel a proprietary lessee’s shares, terminate the proprietary lease and seek to regain possession of the apartment is to be treated deferentially; and that the court’s independent evaluation of the grounds for termination is prohibited. However, an aggrieved shareholder can challenge the validity of such a decision in court by showing that any of the 3 criteria outlined in 40 West 67th Street v. Pullman, 100 N.Y.2d 147 (2003), were not met.

In Pullman, the Court of Appeals affirmed the extent to which the business judgment rule can act as shield to scrutiny of a cooperative board’s decision to terminate a proprietary lease and the standard utilized to determine whether the shield should be upheld given the facts presented, as first enunciated in the seminal case of Levandusky v. One Fifth Ave. Corp., 75 N.Y.2d 530 (1990). In Pullman, the court heard a challenge to the application of the business judgment rule to summary proceedings and the requirements of proof under RPAPL §711. In that case, Respondent argued that Levandusky, an Article 78 proceeding to lift a stop work order issued by the cooperative board, should be limited to non-summary proceedings given the different requirements and burdens of proof in the two types of actions. The court disagreed and found that the business judgment rule can be applied in summary proceedings to satisfy the evidentiary burden required under RPAPL §711. In so holding, the court stated that

“…the procedural vehicle driving this case is RPAPL §711(1), which requires ‘competent evidence’ to show that a tenant is objectionable. Thus, in this context, the competent evidence that is the basis for the shareholder vote will be reviewed under the business judgment rule, which means courts will normally defer to that vote and the shareholders’ stated findings as competent evidence that the tenant is indeed objectionable under the statute…. Despite this deferential standard, there are instances when courts should undertake review of board decisions. To trigger further judicial scrutiny, an aggrieved shareholder-tenant must make a showing that the board acted (1) outside the scope of its authority, (2) in a way that did not legitimately further the corporate purpose or (3) in bad faith.” Pullman, supra. at 155.

In this case, Respondent argues that Petitioner’s actions should not be given differential treatment, because the board’s decision to terminate his lease failed to meet the 3 criteria outlined in Pullman, supra. First, Respondent points to the grounds for termination to show that the board acted without authority under the proprietary lease to terminate his tenancy, because the alleged conduct, even if true, does not violate any specific term of the agreement and, in any event, lacks sufficient factual support to a nuisance claim.

However, this Court finds that Respondent’s argument lacks merit. The issue of articulating sufficient facts to constitute objectionable conduct does not negate the fact that the board had the authority to terminate the lease for such conduct, which is downplayed by Respondent as merely having too many guests, The court cannot use the lack of specificity in the predicate termination notice, if any, to find that the board lacked authority to terminate the proprietary lease. Notwithstanding, Respondent is correct in stating that the court in Pullman held that, in acting within its authority, the board must give proper notice by the mode required pursuant to the lease. Respondent correctly argues that, since he was indisputably not given notice of the special meeting where the vote was taken to terminate his tenancy, the board acted ultra vires.

Petitioner counters that Respondent was not invited to the special meeting because it was not a fact-finding meeting and his presence would have yielded no benefit to him, since he would not have been able to address the board. Petitioner further argues that Respondent was given proper notice of a fact-finding hearing scheduled on July 24, 2018, which Respondent did not attend. Petitioner contends that, since Respondent did not attend the hearing, there was no need to notify him of the special meeting.

Putting the issue of whether Petitioner was required to serve Respondent with notice of the special meeting aside, Respondent, in his affidavit, claims that he was not properly served with notice of the hearing. Notwithstanding, Respondent claims that he did not feel the need to attend the hearing, since he was told by Donna Van Der Linden, the President of the cooperative board of directors, that they only wanted to generally speak to him about subleasing and Airbnb activity and not about any public area nuisance or the fact that the board deemed his alleged conduct to constitute an actionable nuisance. Based upon this conversation, Respondent claims that he did not attend the hearing, particularly since, by then, he had ceased subletting.

In support of its argument that Respondent was given proper notice of the hearing, Petitioner submitted another affidavit by Respondent, averring to his understanding of his conversation with Ms. Van Der Linden as referenced in a letter sent as notice about the hearing. However, this affidavit does not contradict Respondent’s current stance as to his understanding of the purpose of the hearing. Moreover, pursuant to the proprietary lease, service of all notices, including notices regarding hearing and meeting dates, must be completed by registered or certified mail, return receipt requested. Although Petitioner asserts that Respondent was sent a notice dated July 9, 2018 by Mr. Kaye, its managing agent, advising of the hearing to be held on July 24, 2018, Petitioner has failed to show compliance with the notice delivery requirement of the lease and has made no averment as to the mode of service, let alone provide proof of same.

The aforementioned set of events serves to undermine the board’s decision by evincing bad faith. No proof was submitted to show that Respondent was properly advised that his alleged nuisance conduct would be the basis of the hearing. On the contrary, he was incontrovertibly told that the hearing would be about illegal subleasing in general, not specifically about any nuisance allegations against him. The letter sent by the managing agent, even if it had been properly sent and received, did not spell out the purpose of the hearing, but merely references the conversation previously had between Respondent and Ms. Van Der Linden. Based upon this, Respondent, understandably but perhaps unwisely, did not appear at the hearing, because he had endeavored to cure the issue and, therefore, felt there was no need to appear. In light of these facts, this Court finds that the board acted in bad faith by lulling Respondent into a false sense of security that the issue discussed with Ms. Van Der Linden, as stated in Mr. Kaye’s letter, was, or would be, resolved in his favor.

Given this Court’s finding that the board acted in bad faith, and thus outside the scope of its authority, the procedural aspect of the vote taken at the special meeting to which Respondent undisputedly was not invited, can not be shielded by the business judgment rule. Therefore, the sufficiency of the factual allegations contained in the subject termination notice is now subject to examination by this Court.

Sufficiency of the Predicate Notice

In a holdover proceeding, the sufficiency of the pleadings in stating a cause of action depends upon the facial sufficiency of the predicate notices, which terminate the tenancy and serves as the basis of the holdover. Chinatown Apts. v. Chu Cho Lam, 51 N.Y.2d 786 (1980). This is particularly true when, as here, the petition incorporates the allegations of the predicate notices. A petition predicated on a defective notice must be dismissed for failure to state a cause of action. Chinatown Apts. v. Chu Cho Lam, supra. See also, Golub v. Frank, 65 N.Y.2d 900 (1985); 520 East 81 St. Associates v. Lenox Hill Hospital, 77 N.Y.2d 944 (1991); Ansonia Associates v. Consiglio, 163 A.D.2d 98 (1st Dept. 1990).

The standard of review utilized by the courts, upon determining the sufficiency of the factual allegations in a predicate notice, is “reasonableness in view of all attendant circumstances.” Cruz v. Davis, 20 Misc.3d 1135A (Civ. NY 2008); 297 Lenox Realty Co. v. Babel, 19 Misc.3d. 1145A (Civ. Kings 2008); Black Veterans for Social Justice, Inc. v. Killeen, 2007 N.Y. Misc. Lexis 982 (Civ. NY 2007). Courts will uphold a predicate notice as long as it sufficiently advises the tenant of the claimed allegations to enable the tenant to prepare a defense. Black Veterans for Social Justice, Inc. v. Killeen, supra.; Domen Holding Co. v. Aranovich, 1 N.Y.3d 117 (2003); 297 Lenox Realty Co. v. Babel, supra.

Herein, the subject termination notice fails to state with specificity how the alleged conduct by Respondent of having several visitors at early morning hours over a six-month period violates any rule within the proprietary lease or how that activity alone creates a nuisance. The allegation that some of Respondent’s guests “have been found roaming throughout the building and buzzing the intercom for other apartments other than the premises to gain entry…” is too vague, highly presumptive and conclusory and does not state the basis of the knowledge that these persons are Respondent’s guests. Furthermore, it is not stated how often this activity occurs and which other cooperators were complaining about the alleged disturbance in either the predicate notice or the minutes of the board’s special meeting, which is annexed to the predicate notice. In fact, the minutes do not recite any of the specific facts considered by the board upon its determination to terminate Respondent’s tenancy. As such, this Court finds that the subject predicate notice is insufficient to apprise Respondent of the claimed allegations to enable him to prepare a defense and is otherwise not reasonable under the attendant circumstances."

EVICTION OF SENIOR CITIZEN/HOARDER FROM CO-OP

The building involved is one of the Lincoln Towers residential buildings by Lincoln Center. The unit must be at least $500K value with maintenance charges of over $1200 a month. This is a sad story that has been in the court system for several years.

140 W. End Ave. Owners v. Dinah L., NYLJ January 08, 2020,  Date filed: 2019-11-26, Court: Civil Court, New York, Judge: Judge Lillian Wan, Case Number: 73825/2017:



"In this nuisance holdover proceeding, the Court held a trial to determine whether the respondent-tenant created a nuisance condition in her apartment in violation of the proprietary lease, thereby entitling the petitioner-landlord to a final judgment of possession and warrant of eviction. For the reasons set forth below, the Court finds that the petitioner established a prima facie case of nuisance and is entitled to a judgment of possession and warrant of eviction. However, execution of the warrant shall be stayed for 90 days to allow the respondent an opportunity to further cure the condition or to relocate to another dwelling. The respondent-tenant, Dinah L. (hereinafter respondent), who is 72 years old, currently occupies Apartment 12V at 140 West End Avenue in Manhattan, a cooperative apartment where she has lived for over 10 years. In a Thirty (30) Day Notice to Cure dated May 12, 2017, petitioner-landlord 140 West End Avenue Owners Corp. (hereinafter petitioner) alleged that respondent engaged in behavior that violated paragraphs 13, 18(b), 20, and 25 of the proprietary lease, resulting in a failure to meet the substantial obligations of her tenancy. Petitioner alleged that respondent kept her apartment in poor condition by amassing clutter in the form of garbage, books, and newspapers, which resulted in infestation, unreasonable odors, and an increased risk of fire hazard. In a Notice of Termination dated July 28, 2017, petitioner alleged that these violations had not been cured and directed respondent to surrender possession of the premises. Petitioner commenced the instant nuisance holdover action on September 12, 2017.

On June 12, 2018, the New York City Department of Social Services filed a petition pursuant to Article 81 of the Mental Hygiene Law (hereinafter MHL) seeking the appointment of a guardian for Ms. L. On July 5, 2018, the Hon. Shawn T. Kelly appointed Selfhelp Community Services, Inc. (hereinafter Selfhelp) as temporary guardian of Ms. L. and granted Selfhelp the authority to access Ms. L.’s place of abode, arrange for a heavy-duty cleaning of the abode, inform her about the cleaning, and, if necessary, temporarily remove her from the premises to complete the cleaning. On August 21, 2018, Justice Kelly amended the temporary guardian order to include the powers to apply for government and private benefits, marshal and manage income and assets, determine whether Ms. L. is entitled to any additional assets, arrange for and encourage outpatient psychiatric treatment, and assist in selling and auctioning any items of value that may be in Ms. L.’s abode. After a full hearing, Justice Kelly adjudicated Ms. L. to be a person in need of a guardian and appointed Selfhelp as guardian for a period of two years. See Order and Judgment Appointing a Guardian of the Person and Property dated February 7, 2019. Justice Kelly found that Ms. L. has functional limitations that impair her ability to provide for her personal needs and property management, and that the appointment of a guardian is necessary. Selfhelp’s authority included, inter alia, defending Ms. L. in the housing court proceeding, arranging for heavy-duty cleanings of her residence, arranging for and maintaining the appropriate level of home care services, and entering into contracts subject to prior court approval.


After multiple attempts to resolve the matter, the case was set down for trial at the petitioner’s request. The trial commenced on June 27, 2019 and concluded on September 20, 2019. At the trial, the petitioner introduced witness testimony and documentary evidence of respondent’s violations of the proprietary lease. Helen Basurto, an employee of managing agent AKAM Associates, Inc., testified that strong smells of urine and garbage continued to emanate from the apartment as recently as the day before the trial commenced. Ms. Basurto further stated that respondent’s apartment is located directly across from the 12th floor elevators, making it impossible for residents and visitors of that floor to avoid the odors. Ms. Basurto stated that these odors are not present on other floors of the building. Ms. Basurto also testified that while a cleaning of the apartment occurred in October 2018, this only alleviated the odors for a few weeks.


The petitioner also presented the testimony of Robbie Persaud, a handyman employed with the subject building for the last seven years. Mr. Persaud is familiar with Ms. L. as he does yearly maintenance in her apartment. Mr. Persaud testified that he was inside the respondent’s apartment in April 2019 and on June 19, 2019 to inspect her air conditioning units. Mr. Persaud testified that he observed piles of garbage, clothing, papers, and other debris that made navigating the apartment difficult, and that there were extreme odors of urine and feces. The petitioner introduced into evidence 15 photographs taken by Mr. Persaud while inside the premises on June 19, 2019, which depict garbage and clutter strewn throughout respondent’s apartment. Mr. Persaud testified that this condition was also present when he entered the apartment on previous dates. Mr. Persaud stated that strong odors of urine have continuously emanated from the respondent’s apartment. Mr. Persaud did concede that respondent allowed him access on three previous occasions when he knocked on her door.


The petitioner also offered the testimony of Ms. L.’s neighbor, Martin Izaak, who lives in the apartment adjacent to her. Mr. Izaak testified that he is immediately able to smell pungent odors entering the 12th floor hallway and that the smell gets stronger the closer you get to Ms. L.’s apartment. Mr. Izaak further stated that the smell is there constantly and that he is concerned that the smell may cause health issues and diminish the value of his apartment. He also had concerns about inviting his friends to his apartment.


The respondent, represented by counsel to the guardian, presented the testimony of Yajaira Rincon-Brown, the Selfhelp caseworker assigned to Ms. L. Ms. Rincon-Brown testified that a heavy-duty cleaning occurred in October 2018. Ms. Rincon-Brown also testified that she did not notice a smell when she was last in Ms. L.’s apartment on July 30, 2019 and that she did not believe the apartment was cluttered, stating instead that the premises was in need of organization. The respondent introduced five photographs into evidence which were taken after the heavy-duty cleaning conducted in October 2018; however, Ms. Rincon-Brown admitted that these photographs did not reflect the current condition of the apartment.


The petitioner then called Ms. L. as a rebuttal witness. Ms. L. testified that Mr. Persaud did visit her apartment to change the filters in her air conditioning unit but she claimed he did not take photographs. Ms. L. stated that the respondent’s photographs depict the state of her apartment before it was cleaned out and that it does not look like this today. Ms. L. further testified that the current condition of her apartment is slightly different in that it is neater and furniture has been moved around. Ms. L. testified that her apartment is now much more livable and that she is able to move around freely. Petitioner also recalled Mr. Persaud as a rebuttal witness, at which time 12 additional photographs of Ms. L.’s apartment were admitted into evidence. Mr. Persaud testified that he took these photographs in August 2019 and stated that they displayed a condition similar to the one portrayed in the June 2019 photographs. Mr. Persaud also testified that the strong stench of urine and feces was again present in August 2019 and that he saw flies in the apartment.


On summation, the petitioner contends that it established its prima facie case in demonstrating that respondent breached her proprietary lease by interfering with other building residents’ use and enjoyment of their homes. The petitioner further argues that the expanded stay provision of the Housing Stability and Tenant Protection Act of 2019 (hereinafter HSTPA) does not apply to the instant proceeding, as this provision only applies to those actions and proceedings commenced on or after June 14, 2019. Petitioner also contends that the respondent is not entitled to a stay under Real Property Actions and Proceedings Law (hereinafter RPAPL) §753, arguing that a tenant is required to pay all use and occupancy currently owed to obtain a stay under this provision. Petitioner claims that even if respondent is eligible for a stay, respondent is not entitled to a post-judgment opportunity to cure and a stay of the warrant of eviction because respondent has had ample opportunity to cure during the pendency of the proceeding but has failed to do so.


Counsel for the guardian argues that the petitioner’s evidence was insufficient to establish the existence of a nuisance condition. Respondent claims that the testimony of Ms. Basurto and Mr. Izaak cannot establish a pattern of objectionable conduct because neither ever entered Ms. L.’s apartment. While respondent concedes that Mr. Persaud did enter Ms. L.’s apartment, Mr. Persaud also testified that he was able to move about the apartment and complete repairs. Respondent further argues that, in the alternative, it is entitled to an indefinite stay of the execution of the warrant of eviction pursuant to RPAPL §753(4) on the grounds that even if petitioner met its burden of demonstrating that respondent’s behavior constituted a nuisance, respondent established that any nuisance conditions that did exist have been cured.


The elements of a common-law claim for a private nuisance are an interference that is (1) substantial in nature; (2) intentional in origin; (3) unreasonable in character; (4) interfering with a person’s property right to use and enjoy land; and (5) caused by another’s conduct in acting or failure to act. Copart Indus. v. Consolidated Edison Co. of N.Y., 41 NY2d 564 (1977). The Court of Appeals has noted that not every annoyance will constitute a nuisance, and to prevail on a cause of action for nuisance, the plaintiff must establish “a pattern of continuity or recurrence of objectionable conduct.” See Domen Holding Co. v. Aranovich, 1 NY3d 117, 124 (2003), quoting Frank v. Summit Park Summit Realty Corp., 175 AD2d 33, 34 (1st Dept 1991), mod on other grounds 79 NY2d 789 (1991). In the instant matter, it is clear that Ms. L.’s failure to keep her apartment free of clutter and in a sanitary condition over the course of at least two years represents a pattern of continuity and a recurrence of objectionable conduct. The Court determined that petitioner’s witnesses testified credibly in this regard. The testimony of respondent’s witness, Ms. Rincon-Brown, was insufficient to rebut petitioner’s evidence, and is more relevant to this Court’s determination on whether a post-judgment opportunity to cure is warranted. Mr. Izaak, Ms. L.’s neighbor, testified firsthand about the odor emanating from the apartment, and about how it has negatively impacted his life. The photographs in evidence clearly depict the poor and excessively cluttered condition of Ms. L.’s apartment. Therefore, the Court finds that the petitioner has met its prima facie burden in establishing the existence of a nuisance and is entitled to a judgment of possession and issuance of a warrant of eviction.


In determining whether a stay of the execution of the warrant is appropriate, the Court must consider the fact that the respondent is an Article 81 ward of the Court. The Court notes that in arguing against a stay, the petitioner does not cite any cases that involve tenants with Article 81 guardians. Recent case law makes clear that the Court has broad discretion in determining whether a disabled tenant should be given an opportunity to cure a condition or be allowed additional time to relocate, and must consider the equities in reaching that determination.


In Matter of Prospect Union Assoc. v. DeJesus, 167 AD3d 540 (1st Dept 2018), a case involving a disabled Article 81 ward, the Appellate Division, First Department disagreed with the housing court’s determination that the tenant was not entitled to a permanent stay of eviction because the conditions in the apartment were ongoing and not timely cured. The court went on to state that there needs to be a “proper evaluation of whether the Article 81 guardian’s management of their personal (and property) affairs will now make a difference in their ability to stay in their home without harming others.” Id. at 543. The court also concluded that the appointment of an Article 81 guardian sufficiently establishes that the tenant is “handicapped” within the meaning of the Fair Housing Act, and as such “a landlord is obligated to provide a tenant with a reasonable accommodation if necessary for the tenant to keep his or her apartment.” Id. The trial court must consider whether with ongoing supportive services and monitoring, tenants can continue to live in the apartment without harming or affecting their neighbors. Id. at 544. The issue for determination is “whether, with the involvement of the [A]rticle 81 guardian and its management of their affairs, tenants can fulfill their lease obligations and avoid eviction.” Id. Furthermore, the court remanded the case for a hearing to determine whether the accommodations proposed by the guardian were reasonable, whether they would curtail the recurrence of the nuisance, and whether a permanent stay of eviction was appropriate.


Furthermore, in 642-654 Whippersnapper LLC v. Mahoney, 63 Misc3d 46 (App Term, 1st Dept 2019), the Supreme Court, Appellate Term, relying on DeJesus, also remanded the matter back to the housing court for a hearing on whether the tenant was entitled to a permanent stay of eviction as a reasonable accommodation. Mahoney involved a stipulation of settlement that was entered into by the tenant’s guardian ad litem. An Article 81 guardian was subsequently appointed, and the guardian performed a heavy-duty cleaning with extermination services, and implemented home care services to ensure that its ward had regular assistance to maintain the apartment in a sanitary condition. The court held that the circumstances were sufficient to warrant a temporary stay and remittal on the issue of a permanent stay. In noting that the First Department’s holding in DeJesus represents a clear departure from the prior approach previously taken in nuisance cases, the Mahoney court recognized that:


[w]hile the protection of the premises and the other tenants who reside therein remains paramount, serious efforts must be undertaken to examine whether such risks can be minimized to thus afford a reasonable accommodation to a physically or mentally disabled tenant, even for one whose conduct has previously been highly problematic. Id. at 49 (internal citations and quotation marks omitted), quoting Matter of Prospect Union Assoc. v. DeJesus, 167 AD3d at 543.


The Mahoney court also instructed the housing court to consider equitable principles in determining whether to provide the tenant an opportunity to cure, including assessing factors such as the tenant’s advanced age, disability, the hardship that an eviction would cause, and the tenant’s long-term tenancy of over 50 years at the subject apartment. Mahoney, 63 Misc3d at 50; see also Strata Realty Corp. v. Pena, 166 AD3d 401 (1st Dept 2018) (though respondent previously had many opportunities to cure the nuisance she had created, the tenant was granted another stay in light of her advanced age, long-term occupancy, disability, hardship that eviction would cause her, and her willingness to grant petitioner access to the apartment).


In 529 West 29th LLC v. Reyes, 63 Misc3d 65 (App Term, 1st Dept 2019), the Appellate Term, First Department affirmed the Housing Court’s determination that the tenant had a handicap under the Fair Housing Act and was thus entitled to a reasonable accommodation. The court held that a stay of the execution of the warrant of eviction for six months was an objectively reasonable accommodation. Reyes involved a tenant who had been diagnosed with schizophrenia, however the evidence established that the tenant’s condition had greatly improved as a result of an intensive hospital treatment program and social service assistance. Significantly, the court held that the determination of whether an accommodation is required is highly “fact specific,” and should be made on a case-by-case basis. The overarching guiding factor, however, is that a landlord has an obligation to provide a tenant with a reasonable accommodation, if necessary, for the tenant to remain in the apartment. Id. at 68.


In reviewing recent First Department precedent, it follows that if a tenant should have an opportunity to cure a nuisance condition, then the tenant should also be afforded the opportunity to safely relocate. In the instant matter, the Article 81 guardian recently filed a motion seeking to expand its powers in order to retain an appraiser and real estate broker to sell Ms. L.’s apartment with the intention of relocating her. On October 11, 2019, the Court granted the guardian’s motion. The factors set forth in Pena and Mahoney are not exclusive, and it is logical to presume that the need to relocate to another apartment is an appropriate factor to consider. See Beuhler 1992 Family Trust v. Longo, 63 Misc3d 508 (Civ Ct, NY County 2019) (the execution of a warrant of eviction was stayed to allow tenant to obtain relocation assistance from her Article 81 guardian).


In determining whether to allow a further stay, this Court is also guided by the HSTPA. The HSTPA has increased the protections for tenants statewide, and augments, amends, repeals and enacts provisions of a wide range of laws salient to rent regulation and landlord-tenant relations in New York. Specifically, HSTPA, 2019 Sess. Law News of N.Y. Ch. 36, pt. M, §21 (S. 6458) [McKinney's]), amends RPAPL §753(1), and allows a judge to issue a stay of eviction for up to one year where the tenant cannot secure suitable housing in the same neighborhood, or where the eviction would cause “extreme hardship.”1 Similarly, the new legislation provides an automatic 30-day stay of eviction where the eviction is based on a violation of a provision of the lease to allow the tenant an opportunity to cure the breach. The justification behind these expanded timeframes is to “allow more leniency throughout any eviction proceeding, including stays of eviction and executions of warrants; and ensure that any eviction that is executed is done so in the interest of justice.” Legis. Mem. in Support of NY State Senate Bill, 2019 Sess. Law News of NY Ch. 36 (S. 6458) [McKinney's].

In the instant matter, Ms. L. would likely suffer extreme hardship if a stay were not granted. Ms. L. is an elderly Article 81 ward of the Court who has lived in the current apartment for 10 years. Furthermore, the guardian is making good faith efforts to secure a safe, affordable dwelling for Ms. L., and it is reasonable to afford the guardian some time to do so. In the meantime, Ms. L. has allowed the landlord to have access to her apartment and has cooperated with the guardian’s efforts to keep the apartment clean and free of clutter.


The Court declines to condition any stay upon the payment of use and occupancy. The language of RPAPL §753(2) clearly gives the Court discretion to determine what amount of ongoing use and occupancy, if any, will be paid: “the amount of such deposit shall be determined by the court upon the application for the stay,” including in “installments thereof from time to time as the court may direct, for the occupation of the premises for the period of the stay.” In fact, with regard to past due rent or maintenance, a deposit made pursuant to the statute “may also include all rent unpaid by the occupant prior to the period of the stay.” RPAPL §753(2) (emphasis added). Notably, in Tessler v. Tessler, 81 AD3d 408 (1st Dept 2011), the Appellate Division, First Department found that the trial court acted within its discretion by taking respondent’s limited financial resources into account when denying an award of an additional amount of use and occupancy permitted by RPAPL §753(2).


In 326-330 East 35th Street Assoc. v. Sofizade, 191 Misc2d 329 (App Term, 1st Dept 2002), the Appellate Term, First Department noted that circumstances may exist that warrant the issuance of a stay of a possessory judgment “upon such terms as may be just” pursuant to CPLR 2201 in order to avoid a leasehold forfeiture in a holdover proceeding. While there is no “bright-line standard” for determining the appropriateness of a discretionary stay, factors to be considered include the length of the tenancy, the tenant’s payment history, the circumstances and severity of the rent defaults, and the tenant’s present financial status. Id. at 332. Ms. L. does not appear to have the financial means to afford maintenance payments, which is in part why the Article 81 guardian has obtained an expansion of powers to sell the co-op and relocate Ms. L. to a home that she can afford. Significantly, the Court notes that Paragraph 32(c) of the proprietary lease allows for the petitioner to collect on any debt owed pursuant to the sale of a tenant’s shares. It follows that once the apartment is sold, the petitioner can be reimbursed for all maintenance due from the proceeds of the sale.


Equity would not be served with the immediate execution of a warrant of eviction. Accordingly, based on the foregoing, the petitioner is entitled to a final judgment of possession and warrant of eviction. However, after a careful review of the facts and circumstances of this case, and upon balancing all of the equities, the execution of the warrant is stayed for 90 days to allow the guardian time to sell Ms. L.’s apartment and relocate her to a suitable environment or, in the alternative, to allow the guardian an opportunity to cure the nuisance condition without prejudice to the guardian to seek a further stay upon a showing of good cause. Upon expiration of the stay, if the condition is cured, and the respondent should remain in possession of the apartment, petitioner may commence a non-payment proceeding for any unpaid maintenance. See Novak v. Fischbein, Olivieri Rozenholc & Badillo, 151 AD2d 296 (1st Dept 1989).


IT IS HEREBY ORDERED, that a final judgment of possession and warrant of eviction shall issue in favor of the petitioner; and it is further


ORDERED, that execution of the warrant of eviction is stayed for 90 days to allow the guardian time to sell Ms. L.’s apartment and relocate her to a suitable environment or, in the alternative, to allow the guardian an opportunity to cure the nuisance condition, without prejudice to the guardian to seek a further stay upon a showing of good cause.


This constitutes the decision and order of the Court.


Dated: November 26, 2019


Footnotes



1. The prior statute allowed a stay for up to six months but also contained the "extreme hardship" provision."