Green Park Associates v. Inman

• Decision Date: 08 August 1983
• Citation: 121 Misc.2d 204,467 N.Y.S.2d 500
• Parties: GREEN PARK ASSOCIATES, Petitioner, v. Ambrose INMAN, Respondent.
• Court: New York City Court

Page 500

467 N.Y.S.2d 500

121 Misc.2d 204

GREEN PARK ASSOCIATES, Petitioner, v. Ambrose INMAN, Respondent.

Civil Court of the City of New York,

Kings County, Part 35.

Aug. 8, 1983.

William Rappaport, Rappaport & Krimko, Brooklyn, for petitioner.

Marshall Green, The Legal Aid Society, New York City, for respondent.

CAROLYN E. DEMAREST, Judge.

Green Park Arms is a Section 8 Substantial Rehabilitation dwelling organized pursuant to the United States Housing Act of 1937, as amended. 42 U.S.C. § 1437f. This particular housing program provides for rent subsidies, called tenant assistance payments, to be paid by the Department of Housing and Urban Development (HUD) to the owner, with the tenant paying the remaining portion of what is known as the "contract rent." If the tenant's assistance payments are properly terminated, the owner may seek to collect from the tenant "contract rent", which is then called "market rent." Of the circumstances that can lead to termination of tenant assistance payments, proper denial of recertification by the owner is one such event. In the case at bar, the assistance payments were discontinued because of the landlord's failure to recertify. As a result, the full market rent of $800 per month was allowed to accrue and respondent fell into arrears. Petitioner has even refused to accept tendered payments of Mr. Inman's $42 a month contribution to the rent since January 1, 1983. Petitioner now seeks a judgment, in this summary proceeding for nonpayment of rent, for a total of $4,902 for rent due through June 30, 1983. The issue is whether the landlord's actions were proper.

Recertification is a process whereby the tenant's income and household composition are re-examined so that the tenant's rent and assistance payments can be adjusted in accordance with HUD standards. Recertification either takes place annually, upon the anniversary of the effective date of the tenant's lease, or in the interim period between regularly scheduled recertifications if there is a change in either the tenant's income or household composition. There are different notice requirements for regularly scheduled and interim adjustment recertifications. Since respondent's lease term expired December 31, 1982, the procedure here was apparently treated as a routine annual event.

HUD publishes an "Occupancy Requirements of Subsidized Multifamily Housing Programs" handbook, (Doc. 4350.3), which outlines the procedures to be followed by owners of substantial rehabilitation dwellings with regard to recertification and termination of assistance. It is established that the Handbook-prescribed recertification and termination procedures were intended to be mandatory and not, as petitioner suggests, merely advisory. Thorpe v. Housing Authority of Durham, 393 U.S. 268, 276, 89 S.Ct. 518, 523, 21 L.Ed.2d 474 (1969); Staten v. Housing Authority of Pittsburgh, 469 F.Supp. 1013 (W.D.Pa.1979). It is also settled law that petitioner has, by its participation in the HUD program, become a government actor for purposes of the due process clauses of the Fifth and Fourteenth Amendments (Anderson v. Denny, 365 F.Supp. 1254 (W.D.Va.1973); McQueen v. Druker, 317 F.Supp. 1122, 1128 (D.Mass.1970)), and that recipients of federal rent subsidies are protected by the United States Constitution from being deprived of these entitlements without an opportunity to be heard prior to termination of such benefits. Ferguson v. Metropolitan Development and Housing Agency, 485 F.Supp. 517, 521 (M.D.Tenn.1980).

Petitioner contends that it elected to terminate assistance for failure to supply necessary information for annual recertification and that it proceeded in accordance with Section 5-13 and Figure 5-4(2) of the HUD Handbook. Petitioner's insistence that the termination of assistance was provoked by respondent's failure to supply routine information is belied by the grounds actually given the tenant, i.e., harboring a pet, unauthorized occupants and failure to pay rent timely (Petitioner's Exhibit 3), all suggestive of termination for cause. Moreover, petitioner's witness acknowledged that no recertification interview was held prior to termination of benefits and there is no documentation of any specific demand for particular information required for recertification. Furthermore, the actions of petitioner are not consistent with the language of the cited provisions.

Section 5-13 is captioned "Tenant Failure To Supply Interim Reports" (emphasis added) and relates back to Section 5-8 which describes "Tenant's Obligation To Report Interim Changes" (emphasis added) in household income and composition occurring "between the regularly scheduled recertifications". Again contrary to petitioner's assertions, it appears from the evidence that petitioner's intent was actually to proceed, under Sections 5-14, 5-15 and ultimately 5-16, to terminate respondent's assistance, by refusing to recertify him, for failure to supply information consistent with petitioner's suspicions. However, apparently recognizing that the mandatory notice provisions had not been met and that its action in terminating was unlawful without first enlisting the support of HUD's Inspector General for Investigation to confirm that the information supplied by respondent was fraudulent, petitioner attempts to sustain its failure to recertify on purely procedural grounds.

Taking petitioner at its word, and assuming, without deciding, that Section 5-13 is applicable to annual recertification procedures, the...