Chazon, LLC v. Maugenest

• Citation: 971 N.E.2d 852,2012 N.Y. Slip Op. 04373,19 N.Y.3d 410,948 N.Y.S.2d 571
• Parties: CHAZON, LLC, Respondent, v. Margaret MAUGENEST, Appellant, et al., Defendants.
• Decision Date: 07 June 2012
• Court: New York Court of Appeals

19 N.Y.3d 410
971 N.E.2d 852
948 N.Y.S.2d 571
2012 N.Y. Slip Op. 04373

CHAZON, LLC, Respondent,
v.
Margaret MAUGENEST, Appellant, et al., Defendants.

Court of Appeals of New York.

June 7, 2012.

[948 N.Y.S.2d 572]

Goodfarb & Sandercock, LLP, New York City (Margaret B. Sandercock of counsel), for appellant.

Tenenbaum Berger & Shivers LLP, Brooklyn (David M. Berger of counsel), for respondent.

Robert Petrucci, New York City, for Lower Manhattan Loft Tenants, amicus curiae.

[19 N.Y.3d 413]OPINION OF THE COURT
SMITH, J.

[971 N.E.2d 853][1] We hold that the landlord of a New York City loft who has not complied with the Loft Law and has not received an extension of time to comply may not maintain an ejectment action based on nonpayment of rent.

Plaintiff is the owner of a loft building in Brooklyn. Defendant-appellant occupies an apartment in that building, for which she has paid no rent since 2003. Plaintiff brought this action in ejectment; Supreme Court granted summary judgment awarding plaintiff possession of the apartment, and the Appellate Division affirmed (81 A.D.3d 769, 916 N.Y.S.2d 815 [2011] ). We granted permission to appeal (17 N.Y.3d 705, 929 N.Y.S.2d 96, 952 N.E.2d 1091 [2011] ), and now reverse. We conclude that, under the present circumstances, the landlord is not entitled either to collect rent or to evict the tenant. To explain why, we must summarize the historical background and the content of the relevant statutes.

The apartments commonly referred to as “lofts” are in buildings formerly used for commercial purposes—often former factories—that have been rented to residential tenants. Because the buildings do not have a residential certificate of occupancy, this use of the property is contrary to Multiple Dwelling Law § 301(1), which says that, with exceptions not relevant here, “[n]o multiple dwelling shall be occupied in whole or in part until the issuance” of such a certificate. Section 302(1) of the Multiple Dwelling Law says:

“a. If any dwelling or structure be occupied in whole or in part for human habitation in violation of section three hundred one, during such unlawful occupation ...

“b. No rent shall be recovered by the owner of such premises for said period, and no action or special proceeding shall be maintained therefor, or for possession[971 N.E.2d 854]

[948 N.Y.S.2d 573]

of said premises for nonpayment of such rent.”

Until the Legislature enacted the Loft Law (Multiple Dwelling Law art. 7–C) in 1982 (L. 1982, ch. 349), the residential occupancy of lofts was illegal pure and simple: The tenants had no right to be there, and the landlords had no right to collect rent. Such illegal occupancies were common in New York City, and the Legislature enacted the Loft Law as a means of bringing them within the law.

[19 N.Y.3d 414]The Loft Law defines the term “interim multiple dwelling” to mean, essentially, any of these illegally occupied buildings (Multiple Dwelling Law § 281). It establishes a series of deadlines by which the owners of interim multiple dwellings are required to alter them to conform to safety and fire protection standards, ultimately doing everything necessary to obtain a residential certificate of occupancy (Multiple Dwelling Law § 284[1] ). A landlord unable to meet the deadlines “for reasons beyond his/her control” is entitled to an extension of time if that landlord demonstrates to the Loft Board (an agency established by Multiple Dwelling Law § 282) that he or she “has made good faith efforts” to comply (Multiple Dwelling...