S. Axelrod Co., Inc. v. Mel Dixon Studio, Inc.

• Decision Date: 07 October 1983
• Citation: 471 N.Y.S.2d 945,122 Misc.2d 770
• Parties: S. AXELROD COMPANY, INC., Petitioner, v. MEL DIXON STUDIO, INC., Respondent, and James Melvin Dixon, Frank Marsi, "John Doe" and "Jane Doe," Respondents-Undertenants.
• Court: New York City Court

Page 945

471 N.Y.S.2d 945

122 Misc.2d 770

S. AXELROD COMPANY, INC., Petitioner, v. MEL DIXON STUDIO, INC., Respondent and James Melvin Dixon, Frank Marsi, "John Doe" and "Jane Doe," Respondents-Undertenants.

Civil Court of the City of New York New York County.

Oct. 7, 1983.

Rosenberg & Estis, P.C., New York City (Joseph Burden, New York City, of counsel), for petitioner.

Fischbein, Olivieri, Rozenholc & Badillo, New York City (David Pritchard, New York City, of counsel), for respondents.

LESTER EVENS, Justice.

In this holdover proceeding, it is undisputed that the building at issue is an interim multiple dwelling (IMD) as defined by the 1982 Loft Law (Article 7-C of the Multiple Dwelling Law, MDL §§ 280-287). Petitioner asserts, however, that respondent's space does not qualify for the Loft Law's protections because it is being used solely for commercial purposes and, alternatively, because it does not constitute respondent's primary residence.

With the agreement of both sides, the court proceeded to hear solely the issues on the threshold question of whether respondent is entitled to the protections of the Loft Law. It was agreed that if the court found that respondent was not protected, petitioner would then proceed with its prima facie case.

To resolve these issues, the court must determine whether respondent uses his space for residential purposes as a residence or home pursuant to MDL § 281(1)(iii) and whether a primary residence requirement is authorized by and consistent with the language and intent of the 1982 Loft Law. The primary residence issue will be examined first.

I. PRIMARY RESIDENCE

On May 31, 1983, the Loft Board promulgated a regulation that authorized landlords of registered IMDs to bring eviction proceedings against residential occupants whose units were not their primary residences. New York City Loft Board, Rules and Regulations Relating to Determination of Interim Multiple Dwelling Status and Issues of Coverage and Bases for Eviction under Article 7-C of the Multiple Dwelling Law, § J(1)(a), The City Record, June 7, 1983 [hereinafter cited as Rules & Regs. on Bases for Eviction]. This regulation was purportedly promulgated pursuant to the New York City Charter § 1105, MDL § 282, and the Mayor's Executive Order No. 66. ¹

All of these authorizations empower the Loft Board to act within the statutory framework set forth by the Legislature, and only within that framework. A careful analysis of the statutory scheme yields no indication, either express or implied, that the Legislature intended or authorized a primary residence requirement for loft dwellers. Nothing in the language or the legislative history of Article 7-C specifies or suggests such a limitation on the scope of the statute's protections. Indeed, the indications are just the opposite.

A. Legislative Intent

In enacting the Loft Law, the Legislature recognized that it was dealing with a unique situation--one encompassing a class of tenants and a class of buildings bearing little resemblance to those protected by existing remedial housing legislation.

During the two years of intensive negotiations and lobbying efforts that preceded passage of the Loft Law, the Legislature had become keenly aware of the realities of loft living and working, particularly with respect to the infinite variety of living /working arrangements maintained by loft tenants and necessitated by their work--arrangements that in most cases differed radically from those of traditional apartment dwellers.

Indeed, the City of New York, in proposing the Loft Law to the Legislature, had explicitly identified the people most in need of protection in its memorandum of support accompanying the final version of the bill:

The bill when enacted will take a "snap shot" of those people eligible for protection under this article. The bill is directed at protecting those loft pioneers of the arts community that have played such an important role in the development of loft areas. This bill recognizes the important impact that those in the creative arts have on the cultural and economic life of New York City and the need for the protection of loft space suitable for their working and living purposes. [Emphasis added.]

2 McKinney's 1982 Session Laws of New York 2479, 2484.

Sensitized to the extreme vulnerability of this class of tenants and to the serious health and safety implications that would persist as long as this group lacked even minimal statutory protections, the Legislature was particularly intent on protecting those occupants of loft dwellings whose work necessitated such dual uses. Thus, the Legislature acted to alleviate the uncertain status of these tenancies as well as the forced relocation, hardship, and dislocation occasioned by this situation. See MDL § 280.

The statutory definition of an IMD reflects this concern with the complexities of joint living/working use of loft space. It brings into focus the reality that people in the arts work long and irregular hours at their studios, including weekends and holidays, and devote large blocks of time to their artistic pursuits, as the nature of their work may require, in many cases necessitating regular separation from their families for days on end.

MDL § 281(1) defines an IMD, in pertinent part, as any building or structure or portion thereof that "on December 1, 1981, was occupied for residential purposes since April 1, 1980, as the residence or home of any three or more families living independently of one another." (Emphasis added.)

The Legislature's use of "residence or home" in MDL § 281 makes explicit its intent to protect these dual living/working uses and leaves no doubt that it did not contemplate primary residence as a prerequisite for Loft Law protection. Indeed, the "residence or home" distinction unequivocably indicates a much broader and more flexible standard of occupancy for Article 7-C coverage (as will be discussed more fully in the second part of this decision).

Article 7-C recognizes the uniqueness of both loft tenants and the buildings in which they live and work with respect to joint residential/commercial use. It provides protections for both landlords and residential occupants alike that are expressly prohibited for traditional residential tenancies and housing accommodations under existing law, protections that reflect their special situation. ²

Petitioner's analogies to the primary residence requirement under the rent control and rent stabilization laws are inapposite. An analysis of the structural framework of these laws is very instructive in this regard, for it definitively establishes that the Legislature did not intend a primary residence requirement as an implicit condition of Article 7-C coverage.

Close examination of the New York City Rent Control Law and the New York City Rent, Eviction and Rehabilitation Regulations [hereinafter cited as Rent Regs.], the Rent Stabilization Law and the Code of the Real Estate Industry Stabilization Association of New York City, Inc. [hereinafter cited as RSC], and the Emergency Tenant Protection Act of 1974 (ETPA) reveals a consistent statutory scheme in the sense that each of these statutes and accompanying implementing regulations consists of two basic substantive elements, one relating to coverage under the statute and the other dealing with rent regulation and evictions.

Each of these three remedial housing statutes includes an explicit reference to primary residence in its coverage portion. ³ The regulations that implement these statutes refine this theme, detailing how a landlord must proceed when a unit ceases to be eligible for coverage because of a change in the tenant's primary residence. ⁴

Salient here is that in all three statutes the Legislature placed the primary residence provisions within the coverage context, not within the eviction context. The regulations implementing these statutes reflect this focus, dealing with primary residence as a basis for removing a previously controlled unit from coverage during such time as the reason for its protected status no longer exists. ⁵

Article 7-C reflects the same conceptual scheme noted above, containing coverage and rent regulation/eviction components. The Legislature designated the Loft Law as the exclusive source of coverage requirements for loft dwellers, explicitly setting forth the criteria necessary to qualify for Article 7-C's protections. The statute's various provisions are totally devoid of any indication that the Legislature intended primary residence as a prerequisite for coverage or that lack of primary residence would serve as a trigger for removing a unit from coverage, much less as a ground for eviction.

Indeed, even after an IMD has attained code compliance, the ETPA's primary residence provisions will not apply to loft tenants protected by Article 7-C. MDL § 286(3) specifically provides that once compliance is achieved and the Loft Board has set the initial legal regulated rent, each residential occupant must be offered a residential lease subject to the provisions regarding evictions and regulation of rent set forth in the ETPA, except to the extent the provisions of Article 7-C are inconsistent with the ETPA.

Hence, even after compliance, only those provisions of the ETPA dealing with evictions and rent regulation will apply to leases offered to residential occupants, not the ETPA's coverage requirements, and where the ETPA's eviction and rent regulation provisions conflict with the requirements of Article 7-C, the Loft Law's provisions will prevail. Simply put, after compliance, the eviction/rent regulation portion of the ETPA will apply to loft tenancies, but coverage criteria will continue to be governed by Article 7-C. Thus, the ETPA's primary residence exclusion from coverage does not apply to residential occupants protected by the Loft Law now or in the future.

Article 7-C singled out for protection a special class of...