Kruger v. Page Management Co., Inc.

• Decision Date: 25 July 1980
• Citation: 432 N.Y.S.2d 295,105 Misc.2d 14
• Parties: Stephen KRUGER, Plaintiff, v. PAGE MANAGEMENT CO., INC., 25th Realty Associates and Theodore Bye, Defendants.
• Court: New York Supreme Court

Page 295

432 N.Y.S.2d 295

105 Misc.2d 14

Stephen KRUGER, Plaintiff, v. PAGE MANAGEMENT CO., INC., 25th Realty Associates and Theodore Bye, Defendants.

Supreme Court, Special Term, New York County, Part I.

July 25, 1980.

Stephen Kruger, New York City, pro se.

Melvin Charles Cohen, New York City, for defendants.

NORMAN C. RYP, Justice:

Sublease or release? Ratification or reasonable refusal? A legislative intentional dilemma or determination?

A. ISSUE.

Does Real Property Law § 226-b, as amended (Right to sublease or assign), after tenant's requisite notice of intent to sublease and landlord's arbitrary rejection, give a residential tenant the right to sublease or a release from the lease?

B. PROCEDURAL HISTORY & PARTIES' CONTENTIONS.

This is an action by a residential tenant ("tenant") for a declaratory judgment, pursuant to CPLR-3001 & 3017(b), an injunction to compel defendants defendants, owner and managing agents ("landlord"), to consent to a proposed sublease and consequential damages. The basis of tenant's action is landlord's unreasonable withholding of consent, as supported by prior New York caselaw, and as a matter of right under Real Property Law ("RPL") § 226-b, as amended, as logically and equitably interpreted.

In opposition, landlord seeks to dismiss tenant's action upon the merits and with costs and set this matter down for an inquest to determine reasonable attorney's fees, under paragraphs '20. (a) & (c)' and '22.' of the lease (See, complaint X # '1.' & affidavit in opposition X # 'A.'). Landlord, assuming without conceding tenant's allegations, submits that both prior caselaw, under RPL § 226-b, as amended, its clear and proper interpretation and legislative intent as expressed by its New York State Assembly sponsor, mandate the dismissal of tenant's action and granting of landlord's relief.

This action was commenced by Order To Show Cause, dated May 19, 1980, together with a supporting affirmation, summons and complaint, all dated May 19, 1980 and served upon defendants & attorney on May 20 & 21, 1980, respectively. Thereafter, on May 27, 1980, issue was joined by service of defendants' affidavit in opposition upon plaintiff.

C. FACTS.

The facts are undisputed, as follows. Tenant, an attorney appearing pro se, and landlord, on July 30, 1979, duly entered into a Real Estate Board of New York, Inc. standard form of apartment lease (1978) for rent-stabilized apartment 2RW, premises no. 210 East 25th Street, New York, N.Y., which contains over four (4) residential units. Said lease was for a three (3) year term, effective November 1, 1979 and October 31, 1982, at a monthly base rental of $178.25, with a one (1) security deposit.

Pertinent paragraph '18. (A)' of said lease provides:

"18. (A) Assignment, subletting.-Except as provided by section 226-b of the Real Property Law of New York, the Tenant shall not assign the Lease, nor sublet the Apartment, or permit the Apartment or any part thereof to be used by anyone other than Tenant or members of the immediate family of Tenant, without the prior written consent of Owner in each case. If the Lease is assigned, or if the Apartment is sublet or occupied by anyone other than Tenant or Tenant's immediate family, Owner may, after default by Tenant, collect rent from the assignee, subtenant or occupant, and credit the amount collected to the rent due from Tenant, but no such assignment, subletting, occupancy or collection shall be a waiver by Owner of this agreement by Tenant, or the acceptance of the assignee, subtenant or occupant as tenant, or a release of Tenant from the further performance by Tenant of agreements on the part of Tenant mentioned in the Lease. The consent of Owner to an assignment or subletting shall not in any way release Tenant from obtaining the consent in writing of Owner to any further assignment or subletting." (Underlining added)

Paragraphs '20.' (Remedies of Owner) and '22.' (Fees and Expenses) provide for tenant's responsibility recovery of attorney's fees Owner has paid in bringing any legal action or dispossess proceedings for tenant's violation of said lease.

Paragraph '31.' (rider) also provides:

"31. The demised premises are rented and shall be occupied in accordance with Clause # 2 and the Tenant agrees to adhere to the restriction against assignment or subletting." (underlining added)

Thereafter, on May 6, 1980, tenant, by certified mail, return receipt requested, notified landlord's managing agent, Page Management Co., Inc., by Theodore Bye, of his intent to sublease subject apartment, beginning July 1, 1980, to Mr. & Mrs. Kenneth Schnide, proposed sublessees, and included their current respective home and business addresses. (see tenant's X# 1.) It does not appear that the proposed sublessees are members of tenant's immediate family. Mr. Schnide is evidently a medical student, intern or resident at New York Medical College while Mrs. Schnide is an elementary school teacher, both currently living together in High Falls, New York.

Thereafter, on May 15, 1980, landlord, by its managing agent, advised tenant, by mail, that "we do not grant you permission to sublet the apartment. We do not choose to have apartments passed from hand to hand." (see tenant's X # 2; complaint X # 3). Thereafter, on May 20, 1980, tenant commenced this action.

D. APPLICABLE STATUTES.

(1) Real Property Law § 226-b. Right to sublease or assign.

"1. A tenant renting a residence in a dwelling having four or more residential units shall have the right to sublease or assign his premises, subject to the written consent of the landlord given in advance of the sublease or assignment. Such consent shall not be unreasonably withheld. If the Landlord unreasonably withholds consent for such sublease or assignment, the landlord must release the tenant from the lease upon request of the tenant.

2. The tenant shall inform the landlord of his intent to sublease or assign by mailing a notice of such intent by registered or certified mail. Such request

shall be accompanied by the written consent thereto of any co-tenant or guarantor of such lease and a statement of the name, business and home address of the proposed sublessee or assignee. Within ten days after the mailing of such request, the landlord may ask the sender thereof for additional information as will enable the landlord to determine if rejection of such request shall be unreasonable. Within thirty days after the mailing of the request for consent, or of the additional information reasonably asked for by the landlord, whichever is later, the landlord shall send a notice to the sender thereof of his consent or, if he does not consent, his reasons therefore. Landlord's failure to send such a notice shall be deemed to be a consent to the proposed subletting or assignment. If the landlord consents, the premises may be sublet or assigned in accordance with the request, but the tenant thereunder, shall nevertheless remain liable for the performance of tenant's obligations under said lease."

3. (This subdivision simply provides that RPL § 226-b does not apply to: leases entered into before June 3, 1975, the effective date of the statute: public housing or other residential units with constitutional or statutory admission criteria; or a co-operative's proprietary lease. All are inapplicable herein.)

L.1975, ch. 146, eff. June 3, 1975, as amended by L.1975, ch. 548, eff. July 29, 1975 and L.1976, ch. 198, eff. May 25, 1976, which added all provisions relating to the right to assign residential leases & is not applicable herein.

(2) Real Property Law § 226-b, as originally enacted, under L.1975, ch. 146, eff. June 3, 1975, provided:

"1. A tenant renting a residence in a dwelling having four or more residential units shall have the right to sublease his premises, subject to the written consent of the landlord given in advance of the sublease. Such consent shall not be unreasonably withheld. If the landlord unreasonably withholds consent for such sublease, he must agree to release the tenant from the lease or accept the sublessee.

2. The tenant shall inform the landlord of his intent to sublease by mailing a notice of such intent by registered or certified mail. Upon receipt of such notice the landlord must notify the tenant of his consent or lack thereof by registered or certified mail within thirty days. If after the thirtieth day no such notice is mailed, the landlord is deemed to have consented to the sublease. Such sublease shall not release the tenant from his obligations to the landlord." (underlining added indicates deletions by later amendment enacted July 29, 1975 less than two (2) months after the original law, effective June 3, 1975. See, L.1975, ch. 548, eff. July 29, 1975).

(3) Rent Stabilization Law of 1969, as amended ("RSL"), N.Y.C.Admin.Code, ch. 51, §§ YY51-1.0 et seq.

There appear to be no directly applicable RSL provisions, including its Rent Stabilization Code promulgated thereunder. Recently, however, an informational RSL apartment lease Rider, effective May 6, 1980, was approved under RSL § 6.0(d), to be discussed below.

E. APPLICABLE LAW.

1. Common law-Right to sublet or assign & restrictions thereon.

A sublease was originally defined as a grant by tenant of an interest in demised premises less than his (her or its) own, retaining a reversion. Collins v. Hasbrouck, 56 N.Y. 157, 162 (1874). At common law in New York, the general rule is that, in the absence of an express restriction, by contract or statute, a tenant for a definite term has an unrestricted right to assign or sublet at will, Eten v. Luyster, 60 N.Y. 252 (1875); Fleish v. Schnaier, 119 App.Div. 815, 104 N.Y.S. 921 (1st Dep't-1907); with restrictions thereon viewed with disfavor by the Courts. Francis v. Ferguson, 246 N.Y. 516, 519, 159 N.E. 416 (1927); American Book Co. v. Yeshiva University Dev. Foundation, Inc., 59 Misc.2d 31, 33, 297 N.Y.S.2d 156 (Supr.Ct.-N.Y.Co.-1969). Furthermore,...