Turin Hous. Dev. Fund Co. v. Suarez

• Decision Date: 18 February 2016
• Docket Number: Index No. 82366/2012
• Citation: 2016 NY Slip Op 30264 (U)
• Parties: TURIN HOUSING DEVELOPMENT FUND COMPANY, INC., Petitioner/Landlord, v. ALFREDO SUAREZ, et al., Respondents/Tenants.
• Court: New York Civil Court

2016 NY Slip Op 30264(U)

TURIN HOUSING DEVELOPMENT FUND COMPANY, INC., Petitioner/Landlord,
v.
ALFREDO SUAREZ, et al., Respondents/Tenants.

Index No. 82366/2012

CIVIL COURT OF THE CITY OF NEW YORK COUNTY OF NEW YORK: HOUSING PART C

February 18, 2016

DECISION/ORDER

Present: Hon. Jack Stoller Judge, Housing Court

Recitation, as required by CPLR §2219(a), of the papers considered in the review of this motion.

Papers	Numbered
Notice of Motion (Seq. #5) and Supplemental Affidavit and Affirmation Annexed	1, 2, 3
Affirmation In Opposition (Seq. #5)	4
Order to Show Cause (Seq. #6) and Supplemental Affirmation Annexed	5, 6
Affirmation In Opposition (Seq. #6) of Petitioner	7
Affirmation In Opposition (Seq. #6) of Petitioner's counsel	8
Reply Affirmation (Seq. #6)	9
Notice of Cross-Motion (Seq. #7) and Supplemental Affirmation Annexed	10, 11
Notice of Motion (Seq. #8) and Supplemental Affirmation and Affidavit Annexed	12, 13, 14
Affidavit in Opposition (Seq. #8)	15
Order To Show Cause (Seq. #9) and Supplemental Affirmation Annexed	16, 17
Notice of Motion (Seq. #10) and Supplemental Affirmation Annexed	18
Notice of Motion (Seq. #11) and Supplemental Affirmation Annexed	19, 20
Affirmation In Opposition (Seq. #11) of Petitioner	21
Affirmation In Opposition (Seq. #11) of Petitioner's counsel	22
Notice of Motion (Seq. #12) and Supplemental Affirmation Annexed	23, 24
Notice of Motion (Seq. #13) and Supplemental Affirmation and Affidavit Annexed	25, 26, 27
Affirmation In Support (Seq. #13) of Petitioner's former agent	28
Affirmation In Support (Seq. #13) of Petitioner's counsel	29
Notice of Cross-Motion (Seq. #14) and Supplemental Affirmation Annexed	30
Affirmation In Opposition (Seq. #14) of Petitioner	31
Reply Affirmation (Seq. #14) to Petitioner's Opposition	32
Affirmation In Opposition (Seq. #14) of Petitioner's counsel	33

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Reply Affirmation (Seq. #14) to Petitioner's counsel's Opposition
34

Upon the foregoing cited papers, the Decision and Order on this Motion are as follows:

Turin Housing Development Fund Company, the petitioner in this proceeding ("Petitioner"), commenced this summary proceeding against Alfred Sanchez ("Respondent's late husband"), seeking a money judgment and possession of 609 Columbus Avenue, Apt. 6L, New York, New York ("the subject premises") on the basis of nonpayment of maintenance. Petitioner obtained a judgment based upon a failure to answer. A warrant of eviction issued and was executed. Cruz Sanchez ("Respondent") moved to be restored to possession. The parties entered into a stipulation dated July 9, 2013 ("the Stipulation") vacating the judgment and warrant and restoring Respondent to possession. The Court then entered into an order dated August 1, 2013 ("the Order") finding that Petitioner's conduct in this proceeding warranted a hearing to determine if sanctions should be imposed and, if so, how much. The proceeding was then marked off calendar. Now various movants move for various kinds of relief. The Court consolidates these motions for resolution herein.¹

As noted above, the Stipulation vacated the judgment and warrant, restored Respondent

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to possession of the subject premises, and adjourned so much of the motion as sought a judgment sounding in attorneys' fees to July 31, 2013. The Court reserved decision that day and entered into the Order on the following day.

The Order found that the subject premises is located in a residential cooperative building subject to a subsidy pursuant to 12 U.S.C. §1715z-1, known colloquially as "Section 236"; that Respondent's late husband was a proprietary lessee of the subject premises; and that Respondent's late husband died in September of 2007. The record shows that the rent demand pursuant to RPAPL §711(2) and the notice of petition and petition, dated more than four years after Respondent's late husband died, only named Respondent's late husband and no other party. The record also shows that Petitioner only purported to serve Respondent's late husband and no other party with the rent demand and the petition, again years after Respondent's late husband died. The Order found that the then-managing agent for Petitioner ("the managing agent") entered into an affidavit pursuant to 50 U.S.C. §3931 swearing that she had spoken with Respondent's late husband to investigate whether he was in the military on a date after he had, in fact, died; that the managing agent admitted that she executed the affidavit without reading it and that that was her standard practice; that the managing agent swore in another affidavit in support of a default judgment that she did not know of any reason why Respondent's late husband would not be able to answer the petition even though Petitioner's records indicated that, had Respondent's late husband been alive at that time, he would have been ninety years old; and that Petitioner had written knowledge of Respondent's tenancy at the subject premises — which extended back to 1979, thirty-three years before the commencement of this proceeding — and

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still proceeded to evict her without ever naming or serving her. The Order found that Petitioner's eviction of Respondent "is clearly an action without any merit in law."

The Order further found that Petitioner was made aware of Respondent's unlawful eviction claim in May of 2013, but that Petitioner did not restore Respondent to possession of the subject premises until two months later, after she had retained counsel.

The Court noted that Petitioner's counsel signed the petition pursuant to 22 N.Y.C.R.R. §130-1.1. The Court granted Respondent's motion for sanctions"to the extent of setting the matter down for a hearing to provide Petitioner, its agents and counsel with a reasonable opportunity to be heard prior to a final determination on whether Petitioner and its attorneys engaged in frivolous conduct ..., whether cost and/or sanctions ... should be imposed on Petitioner and/or [Petitioner's] attorney[], and if so the appropriate amount of said costs and/or sanctions." The Court made this determination, it noted, despite Petitioner's assertion in opposition to Respondent's motion that Respondent committed some type of fraud by not living in the subject premises and evading HUD requirements for annual re-certification. The file shows that Respondent served Petitioner with a copy of the order with notice of entry pursuant to CPLR §5513(a) on August 6, 2013.

No party objects to a restoration of this matter to the Court's calendar. Respondent sued Petitioner in a plenary action in Supreme Court, and there had been some question as to removal of this proceeding as such, but the Court resolved this question in the negative. The Court therefore grants Respondent's motion to restore this proceeding to the Court's calendar herein.²

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The motions of Petitioner and Petitioner's counsel³ to vacate the Stipulation and the Order raise a threshold issue. Accordingly, the Court addresses the motions to vacate the Stipulation and Order before reaching the other motions.

Petitioner and Petitioner's counsel argue that Respondent has not been residing in the subject premises as her primary residence, thus perpetuating a fraud upon Petitioner and the Court and warranting vacatur of the judgment and warrant. As evidence of Respondent's failure to primarily reside in the subject premises, Petitioner and Petitioner's counsel show unrebutted documentation of another summary proceeding that another owner of subsidized housing ("the other landlord") commenced against Respondent in a different part of the New York County Housing Court. An order of that Court part found that Respondent lives at this other address ("the other apartment"). Petitioner and Petitioner's counsel argue that Respondent's failure to maintain the subject premises as her primary residence renders ineffective her claim that she was harmed by an illegal eviction, and furthermore that Respondent should not have been restored to the subject premises in the first instance. See 24 C.F.R. §236.710(a) (if an occupant of Section 236 housing is a shareholder in a cooperative, the benefits therein are only available to cooperative members who occupy the dwelling units).⁴

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Even though the Order was not obtained on default, the Court may consider a motion to vacate a judgment based upon newly-discovered evidence and fraud, both of which Petitioner and Petitioner's counsel allege here. See, e.g., Prote Contr. Co. v. Board of Educ., 230 A.D.3d 32 (1^st Dept. 1997). Be that as it may, even assuming arguendo that Respondent made a misrepresentation to Petitioner and to the Court, not every misrepresentation or omission rises to the level of fraud. Gaidon v. Guardian Life Ins. Co. of Am., 94 N.Y.2d 330, 350 (1999). Compare Held v. Kaufman, 91 N.Y.2d 425, 431 (1998) (a misrepresentation must be material in order for a party to have a cause of action sounding in fraud), Small v. Lorillard Tobacco Co., 94 N.Y.2d 43, 57 (1999) (an act of deception, entirely independent or separate from any injury, is not sufficient to state a cause of action under a theory of fraudulent concealment). Assuming arguendo that Respondent maintains her primary residence somewhere other than the subject premises, and further assuming arguendo that Respondent misrepresented her primary residence in the prior motion practice, Petitioner and Petitioner's counsel lose sight of the fact that this is a proceeding sounding in nonpayment of maintenance. Neither Petitioner not Petitioner's counsel allege that Respondent owed arrears in maintenance at the time she was evicted. To the extent that a vacatur of the Order and the Stipulation would reinstate the judgment and warrant against Respondent, it would do so with complete disregard of the merits of this proceeding.

Nor do Petitioner or Petitioner's counsel...