156-158 Second Ave., LLC v. Delfino, 2008 NY Slip Op 50440(U) (N.Y. Civ. Ct. 2/22/2008), L & T 079258/2006.
| Decision Date | 22 February 2008 |
| Docket Number | L & T 079258/2006. |
| Citation | 2008 NY Slip Op 50440 |
| Parties | 156-158 SECOND AVENUE, LLC, Petitioner Landlord, v. MICHAEL DELFINO, Respondent-Tenant, and MARK A. MARROLETTI "JOHN DOE" and "JANE DOE", Respondent-Undertenants. |
| Court | New York Civil Court |
Cornicello & Tendler, LLP, by: David B. Tendler, Esq., New York, New York, Attorneys for Petitioner.
African Services Committee, by: Chitra Aiyar, Esq., New York, New York, Attorney for Respondent.
In this residential holdover proceeding, petitioner-landlord seeks possession of Apartment 2B (the "apartment"), a rent stabilized apartment located at 156 Second Avenue, New York, New York, 10003 (the "premises"), on grounds that the tenant of record, respondent Michael Delfino, overcharged his roommate for the use of the apartment in violation of Rent Stabilization Code ("RSC") [9 NYCRR] § 2525.7.
Respondent moves for summary judgment pursuant to CPLR 3212 (b), claiming that his rent-sharing arrangement did not rise to the level of profiteering and that the court lacks subject matter jurisdiction on grounds that a Notice to Cure was required. Petitioner opposes and cross-moves for leave to conduct discovery.
Respondent has been the rent stabilized tenant of Apartment 2B, a three bedroom unit, since December 1, 1993. The most recent renewal of his lease was on September 1, 2005,1 for which the legal monthly rent was $2,556.79. Respondent alleged that, in the same year, both of his roommates moved out of the apartment and, despite his efforts, respondent was unable to find suitable replacements until January 2006, when he found one roommate who was willing to pay more than half the rent in consideration for his occupancy of two of the three bedrooms. When this roommate moved out in December 2006, according to respondent, his current roommate, William A. Marroletti,2 moved in under a similar arrangement to that of the previous roommate. Respondent claims that Mr. Marroletti agreed to pay a greater portion of the rent in consideration for his occupancy of two of the three bedrooms within the apartment. Of the legal rent, $2,556.79, respondent stated that he paid $1,057 per month whereas Mr. Marroletti paid $1,500 in cash to respondent. Mr. Marroletti's payments were then converted into two money orders of $1,000 and $500 and forwarded to the landlord each month.
Respondent claims that he is unable to work due to a chronic disability, for which he receives rental assistance of $1,057 from the New York City Human Resources Administration ("HRA"). According to respondent, HRA pays directly to petitioner in two monthly installments of $528.50 to cover respondent's portion of the rent.
In the summer of 2006, respondent fell into arrears and petitioner commenced a nonpayment proceeding on or about September 11, 2006 seeking $6,131.90 in rent.3 Respondent answered on September 20, 2006, seeking time to pay the arrears, and the nonpayment proceeding was calendared for September 28, 2006. On September 28, 2006, the parties appeared in court and entered into a Stipulation of Settlement in which the parties consented to a final judgment in the amount of $6,131.90 with a Warrant of Eviction to issue forthwith and execution stayed through October 31, 2006 upon the condition that respondent pay the October 2006 rent by October 10, 2006 and the arrears by October 31, 2006. Respondent defaulted under this Stipulation and brought six Orders to Show Cause to stay execution of the Warrant of Eviction. The matter came before the court on December 27, 2006 (the "December 27th Court Appearance"), in which respondent's rent-sharing arrangement was discussed for the first time. The court informed respondent that the arrangement may possibly be a violation of RSC § 2525.7. On March 26, 2007, petitioner and respondent executed a Stipulation of Settlement (the "March 26th Stipulation") in which respondent conceded to having a roommate named "William Marroletti" who had been paying a monthly rent of $1,500 since January 2007. Neither the Stipulation nor the transcripts reflect how the bedrooms were divided between respondent and his roommate.
On or about June 21, 2007, petitioner served a Ten Day Notice of Termination of Tenancy and Intention to Recover Possession ("Termination Notice") based upon respondent's concession in the March 26th Stipulation and upon its allegation that respondent's rent-sharing arrangement with his roommate constituted rent gouging prohibited by RSC § 2525.7. No predicate Notice to Cure was served upon respondent. Respondent continued to remain in possession of the apartment through the expiration of the Termination Notice and, on or about July 19, 2007, petitioner commenced this proceeding.
Respondent now moves for summary judgment, arguing, among other things, that his rent-sharing arrangement did not rise to the level of profiteering, that he was unaware and uninformed by the landlord that it may be construed as such, and that he was not served with a Notice to Cure. Respondent claims that his rent-sharing arrangement, in which Mr. Marroletti paid approximately 58% of the total legal rent, did not constitute profiteering and that it was an insubstantial overcharge that was entirely reasonable upon consideration of Mr. Marroletti renting two of the three bedrooms within the apartment. Thus, even if deemed to be an overcharge under RSC § 2525.7, respondent claims it to be an offense that is wholly curable and for which a predicate Notice to Cure must have been served. Petitioner justifies its failure to send to respondent a predicate Notice to Cure claiming that the overcharges constituted profiteering, which is an incurable offense.
Overcharging roommates gives rise to a possessory cause of action on the part of the landlord (see First Hudson Capital LLC v. Seaborn, 15 Misc 3d 40 [App Term, 1st Dept 2007]; West 148 LLC v. Yonke, 11 Misc 3d 40 [App Term, 1st Dept 2006]; RAM 1 LLC v. Mazzola, 2001 Slip Op 50073 [U] [App Term, 1st Dept 2001]; see also Greene Street Realty Corp. v. Shook, 8 AD3d 168 [1st Dept 2004] []; Murphy v. Carter, 15 Misc 3d 75 [App Term, 1st Dept 2007] []; Roxborough Apt. Corp. v. Becker, 11 Misc 3d 99 [App Term, 1st Dept 2006]). An overcharge occurs where the roommate pays in excess of his "proportionate share of the legal regulated rent charged to and paid by the tenant for the subject housing accommodation" (RSC § 2525.7 [b]). The "proportionate share" is "determined by dividing the legal regulated rent by the total number of tenants named on the lease and the total number of occupants residing in the subject housing accommodation" (id.). With only respondent and Mr. Marroletti living in the apartment, respondent was only permitted to charge Mr. Marroletti 50% of the legally regulated rent, or $1,278.40. Charging Mr. Marroletti $1,500.00 represented an overcharge of $221.60 or 17.33%.
A landlord may generally only bring a proceeding for eviction based upon a claim that a tenant violated a substantial obligation of his or her tenancy after serving a written 10 day Notice to Cure (326-330 East 35th St. Assoc. v. Sofizade, 191 Misc 2d 329, 330 [App Term, 1st Dept 2002]; RSC § 2524.3[a]). Petitioner's notice to terminate advises respondent that "you have violated a substantial obligation of your tenancy and the law in that you are engaged and have engaged in rent gouging an incurable offense in violation of Section 2525.7 of the [RSC]. . . . " As the petitioner advances the theory that respondent violated a substantial obligation of his tenancy, a 10 day Notice to Cure was required.
There are only two possible exceptions to the Notice to Cure requirement. The first exception arises where it is asserted that the tenant has "willfully violated" a substantial obligation of the tenancy and "inflicted serious and substantial injury upon the owner within a three month period immediately prior to the commencement of the proceeding" (RSC § 2524.3[a]). This exception is inapplicable since neither the notice of termination nor the petition assert a willful violation or a serious or substantial injury.
The second exception stems from a line of cases holding that failure to serve a Notice of Cure is not fatal where, based upon the cumulative pattern of a tenant's chronic nonpayment of rent the course of conduct is incapable of any meaningful cure (Herald Towers, LLC v. Perry, 2003 NY Slip Op 50564[U] [App Term, 1st Dept 2003]; Century Apartments Assoc. v. Kleinman, 2002 NY Slip Op 50303[U] [App Term, 1st Dept 2002]; Sofizade, 191 Misc 2d at 330 [App Term, 1st Dept 2002]; Adam's Tower Ltd. Partnership v. Richter, 186 Misc 2d 620, 622 [App Term, 1st Dept 2000]; see also 2215-75 Cruger Apartments, Inc. v. Stovel, 196 Misc 2d 346, 347 [App Term, 1st Dept 2003]; 974 Realty Corp. v. Ledford, 9 Misc 2d 240, 241 [App Term, 1st Dept 1957]). This holding reflects a desire to "dispense with the empty formalism of a cure notice. . . " which would be a futile act ". . . since the past, persistent rent defaults which form the basis of the landlord's claim cannot be remedied by a tenant's furnishing of assurances of...
To continue reading
Request your trial