Palmer v. 309 East 87th St. Co.

• Decision Date: 03 February 1982
• Citation: 447 N.Y.S.2d 1000,112 Misc.2d 667
• Parties: Lenore M. PALMER, Plaintiff, v. 309 EAST 87TH STREET CO., Defendant.
• Court: New York Supreme Court

Page 1000

447 N.Y.S.2d 1000

112 Misc.2d 667

Lenore M. PALMER, Plaintiff, v. 309 EAST 87TH STREET CO., Defendant.

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

Feb. 3, 1982.

Crane & Hawkins, Gould & Davis, New York City, for plaintiff; Mark L. Carson-Selman, New York City, of counsel.

Leon Brickman, Brooklyn, for defendant.

NORMAN C. RYP, Justice:

Sublease or Release? Is landlord's alleged 'waiting list' reasonable refusal of a sublease under Real Property Law ("RPL") § 226-b and a consistent apartment lease in a co-operative conversion building? An issue of conflicting impression under the rule of reason or a 'red herring'?

A. ISSUE.

Does RPL § 226-b, as amended (right to sublease or assign) plus a parallel lease clause, after tenant's requisite notice of intent to sublet and landlord's refusal reason (prior 'waiting list') give a residential tenant the right to sublease or landlord the right to release tenant from the lease?

B. PROCEDURAL HISTORY AND PARTIES' CONTENTIONS.

Plaintiff, a residential tenant ("tenant") and employee of Wells Fargo International, by an Order to Show Cause, dated December 24, 1981, for a preliminary injunction, under CPLR 6311 and 6313, based upon an underlying action for declaratory judgment, pursuant to CPLR 3001-3017(b) including a mandatory injunction to enjoin defendant, 309 East 87th Street Co. ("landlord") from interfering with the proposed sublet, after declaring its rejection unreasonable and to compel landlord to consent to a proposed nine (9) months sublease, effective February 1, 1982 to October 31, 1982 to an English solicitor and an attorney who is a partner in a New York law firm (representing tenant herein) and for attorneys' fees. Tenant's action is based upon landlord's alleged unreasonable withholding of consent, under: (a) Paragraph "16" of the original lease, dated December 5, 1977 (eff. January 1, 1978--December 31, 1980) and later renewed until December 31, 1983, Rent Stabilization Code ("RSC") § 61, subd. 7, including a ninety (90) day co-operative plan notice of cancellation clause (landlord's exh. 'A') as a matter of contract; and (b) as a matter of law, by applicability of and compliance with Real Property Law § 226-b (RPL § 226-b) and current case law thereunder.

In opposition and in support of its CPLR 3211 cross-motion to dismiss, landlord generally denies tenant's compliance with RPL § 226-b by tenant's equivocal request and tenant's guarantors' request release from any assignment. Landlord contends its reason for rejection set forth in a letter dated November 12, 1981 (tenant's exh. 'I', landlord's exh. 'C') to tenant was legitimate and reasonable, namely, there are a number of people who have expressed their need for a one bedroom apartment and there is no reason why the landlord should show preference for a sub-tenant or new tenant over our candidates for the apartment. Finally, submits defendant, plaintiff is being married and moving to London with no intention to return to subject apartment, for which, in fact, a lease assignment from and abandonment by tenant and upon a possible consideration from the proposed assignee, not a sub-tenant, as requested. Thus, defendant submits, if RPL § 226-b is applicable, defendant has successfully complied with its requirements, by reasonable withholding of consent herein.

In reply, tenant, by counsel, alleges that the notice to sublet is clear and unequivocal on its face with an assignment alternative "if preferable" to landlord, accompanied by guarantor's letter of consent; landlord specifically responded to tenant's "notice of intent to sublet"; in fact landlord seeks a cooperative conversion of subject building and seeks to deprive tenant of her rights thereunder.

Tenant's action was commenced by Orders to Show Cause together with supporting affidavit, summons and complaint, all dated December 24, 1981, respectively, and respectively served upon defendant on December 28, 1981. Thereafter, on January 7, 1982, respectively, issue was joined by service of defendant's notice of cross-motion and affidavit in opposition upon plaintiff.

C. FACTS

The facts are substantially undisputed, as follows. On December 5, 1977, tenant and landlord entered into a Real Estate Board of New York, Inc. standard form of apartment lease (1973) for a one (1) bedroom, rent-stabilized apartment 4J, premises No. 307 East 87th Street, New York, New York which contains over four (4) residential units. Said lease was for a two (2) year term, effective January 1, 1978 and ending December 31, 1980, at a monthly rental of $365.00, with one (1) month security deposit and guaranteed by tenant's mother, Margaret E. Palmer. (landlord's exh. 'A').

Pertinent paragraph "16" of said lease relevantly provides:

"Assignment, Mortgage, etc.:

16. Except as permitted by Real Property Law Section 226-b, Tenant, for itself ..., successors and assigns, expressly covenants that it shall not assign, ... nor underlet ... or permit the demised premises ... to be used by others without the prior written consent of Landlord such consent shall not be unreasonably withheld in each instance. If this lease be assigned, or if the demised premises ... be underlet or occupied by anybody other than Tenant, Landlord may, after default by Tenant, collect rent from the assignee, under-tenant or occupant, and apply the net amount collected to the rent herein reserved, but no such assignment, underletting, occupancy or collection shall be deemed a waiver of this covenant, or the acceptance of the assignee, under-tenant or occupant as tenant, or a release of Tenant from the further performance by Tenant of covenants on the part of Tenant herein contained. The consent of Landlord to an assignment or underletting shall not in any wise be construed to relieve Tenant from obtaining the express consent in writing of Landlord to any further assignment or underletting."

Said lease was subsequently renewed for a one (1) year term ending December 31, 1981.

Thereafter, on December 16 to 17, 1981, tenant and landlord, again, duly executed a two (2) year renewal, effective January 1, 1982 through December 31, 1983, of said lease at a monthly rental of $457.82, pursuant to the Rent Guidelines Board under the Rent Stabilization Law of 1969, as amended ("RSL") and a ninety (90) day cooperative plan cancellation clause under RSC § 61, subd. 7 (see, landlord's exh. 'A').

Prior thereto, by letter dated October 8 and mailed October 15, 1981, by certified mail, return receipt requested, enclosing tenant's guarantor's consent to such subletting, dated October 9, 1981, tenant formally sent landlord a notice to renew and sublet said lease under paragraph '16' thereunder and RPL § 226-b. Such proposed sublease was to be effective February 1, 1982 for a period of nine (9) months while tenant marries, lives and works with her prospective banker husband originally in Nairobi, Kenya (later transferred to London, England) with expressed intent to return to subject apartment. The proposed sublessee is one Anthony E. Davis, Esq., an English solicitor, member of the New York Bar and partner.

Thereafter, landlord's managing agent, A. Eisenger, by certified mail, return receipt requested, refused to consent to tenant's proposed sublessee, claiming landlord has "a number of people who have expressed their need for a one-room apartment and there is no reason why the landlord should show preference for Mr. Davis, a sub-tenant or new tenant over our candidates for the apartment".

"Pursuant to the requirements of law, having given these reasons for denying you the right to sublet the landlord here, offers to release you from the lease." (tenant's exh. 'II').

Thereafter, on November 24, 1981, tenant in response to landlord's November 12, 1981 denial letter rejected landlord's offer of release from her subject lease (tenant's exh. 'III'). Thereafter, as noted above, on December 16 to 17, 1981 landlord and tenant duly executed a RSL two (2) year lease, renewal, effective January 1, 1982 through December 31, 1983 including an RSC § 61, subd. 7 ninety (90) day cooperative cancellation clause (landlord's exh. 'A').

D. APPLICABLE STATUTES.

1--Section 226-b of the Real Property Law (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 or 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 sent 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 obligation under said lease." (italics supplied.)

"3. (This subdivision simply provides that Real Property Law, § 226-b does...