950 RUTLAND ROAD CO LLC v. LORD (2021)

Petitioner's motion for leave to reargue and renew is granted, and after argument and review of the papers the Court adheres to its December 21, 2020 Decision (“Decision”).

This summary non-payment proceeding started as a routine case in which Petitioner alleged that Respondent Curlisha Lord (“Respondent”) failed to pay the balance of September 2019 rent of $100.00, and October and November 2019 rent at $2,200.00 per month, for a total balance owed of $4,500.00 through November 2019. From there, complexities abounded. First, Andrew Johnson (“Occupant”) interposed a pro se answer containing a general denial. Then, counsel appeared for Occupant and the proceeding was adjourned for motion practice, however, the COVID-19 pandemic struck and Court appearances in all but emergency cases were administratively adjourned. The assemblage of litigants came to full fruition when Respondent Curlisha Lord appeared by counsel and filed her Answer on July 17, 2020. Counsel for all 3 parties stipulated to motion practice, which resulted in 3 fully briefed motions and culminated in the Court's December 21, 2020 Decision. Petitioner's motion to reargue and renew challenges nearly every determination in the Court's 15-page Decision which was not rendered in Petitioner's favor.

One prong of Petitioner's motion to reargue concerns Occupant's underlying motion for leave to file an Amended Answer which contained nine affirmative defenses and one counterclaim. Petitioner opposed, taking the position that Occupant lacks standing to interpose his Answer. The Court, citing RPAPL § 743, which provides in pertinent part that “the respondent, or any person in possession or claiming possession of the premises, may answer orally or in writing,” held that Occupant has standing to interpose an Answer as of right since he claims to be in possession of the premises. The Court adheres to its position and is not persuaded by Petitioner's analysis of the interplay between RPAPL § 743 and RPAPL § 732, which hinges on an interpretation that is contradicted by the plain language of the statute and which, if adopted, would lead to seemingly unfair results and unintended consequences.¹ Occupant's answer does not deprive Respondent of her right to answer, nor does Respondent's answer preclude Occupant from answering. Since Occupant is both in possession and claiming possession, he is entitled to appear in the proceeding. (See, Decaudin v. Velazquez, 15 Misc 3d 45 [App. Term, 2nd Dep't 2007]).

Beyond the threshold issue of whether Occupant can file an Answer, which the Court answered in the affirmative, Occupant's motion also sought to leave to interpose an Amended Answer. It is well established that permission to amend pleadings should be “freely given,” and that trial courts have broad discretion to grant leave to amend. (Edenwald Contracting Co., Inc. v. City of New York, 60 NY2d 957, 959 [1983], quoting CPLR 3025(b); see also, Murray v. City of New York, 43 NY2d 400 [1977]). The Court granted leave and the Amended Answer was deemed filed. As a motion to strike was not before the Court at that juncture, the Court reviewed the proposed defenses contained in Occupant's Amended Answer to determine whether they were palpably insufficient or patently devoid of merit on their face. (Confidential Lending, LLC v. Nurse, 120 AD3d 739, 741 [2nd Dep't 2014]). In accordance with the applicable standard of review, Occupant was granted leave to interpose his Third through Fifth and Seventh through Ninth Affirmative Defenses and a counterclaim. The Court struck the First, Second and Six Affirmative Defenses as palpably insufficient.

The Decision concerning Occupant's Amended Answer was without prejudice to Petitioner serving a motion to strike and Occupant opposing same. In conjunction with Petitioner's motion to renew and reargue, Petitioner has now moved to strike Occupant's remaining defenses and counterclaim. For the sake of continuity, the Court will now address Petitioner's motion to strike.

Under CPLR 3211(b), “a party may move for judgment dismissing one or more defenses, on the ground that a defense is not stated or has no merit.” Petitioner has the burden of demonstrating that the affirmative defense is “without merit as a matter of law.” (Bank of New York v. Penalver, 125 AD3d 796, 797 [2nd Dept 2015], lv to appl dism. 26 NY3d 1030 [2015]; quoting, Vita v. New York Waste Servs., LLC, 34 AD3d 559, 559 [2006]). In this context, “the Court must liberally construe the pleadings in favor of the party asserting the defense and give that party the benefit of every possible inference.” (Fireman's Fund Ins. Co. v. Farrell, 57 AD3d 721, 723 [2008]).

Occupant, by Affidavit, alleged that he entered possession of the premises with Respondent on or about May 2016, and that Respondent is a close family member [niece] that he has taken care of for many years. Occupant alleged that the initial co-tenant, Michael Peters, was a friend of his that never lived in the premises, and that the landlord was aware of this arrangement from its inception. Occupant further alleged that Respondent permanently vacated the premises.

Based on the foregoing allegations, Occupant's Amended Answer claims that he has succession rights to the premises (Eighth Affirmative Defense). Petitioner moves to strike, alleging that Occupant, as an uncle, has not established the requisite familial relationship with Respondent to assert succession rights, that Occupant has not produced proof of residency for the requisite time period, and that succession is not viable as Respondent has not surrendered or permanently vacated the premises. In opposition, Occupant asserts that he and Respondent, based on their emotional and financial commitment and interdependence, are family members as defined by the Rent Stabilization Code. (See, 9 NYCRR § 2520.6(o)(2); see also, Braschi v. Stahl Assoc. Co., 74 NY2d 201 [1989]). Occupant also asserts that he was a co-tenant from the inception of the tenancy and that he has met the minimum period of required residency. (See, 9 NYCRR § 2523.5(b)). Occupant submitted an affidavit in opposition, which included voting records and tax returns, and maintains that Respondent permanently vacated the premises. It is important to note that Occupant does not have the burden of proving his claim at this juncture to survive a motion to strike. Rather, the burden falls on Petitioner to establish conclusively that Occupant does not have a cause of action. (See, Rovello v. Orofino Realty Co., 40 NY2d 633 [1976]; see also, Guggenheimer v. Ginzburg, 43 NY2d 268 [1977]). Therefore, as Petitioner has not met this high burden, the motion to strike Occupant's Eight Affirmative Defense is denied. The Court does not express any opinion as to whether Occupant will ultimately succeed on the claim.

A similar analysis applies to Occupant's illusory tenancy defense (Ninth Affirmative Defense). Occupant's Amended Answer and affidavit in opposition to Petitioner's motion to strike allege that the initial co-tenancy of Michael Peters was illusory, that Occupant Andrew Johnson was the actual co-tenant of Respondent Curlisha Lord, and that Petitioner was aware of the arrangement from the inception of the tenancy. Petitioner's motion papers and supporting affirmation and affidavit fail to establish conclusively that Occupant does not have a cause of action for illusory tenancy, therefore, Petitioner's motion to strike Occupant's Ninth Affirmative Defense is denied. The Court does not express any opinion as to whether Occupant will ultimately succeed on the claim, as that issue is not presented at this time.

Occupant's Third, Fourth and Seventh Affirmative Defenses, as well as First Counterclaim, all concern allegations that the rent for the premises is incorrect and that a rent overcharge occurred. As discussed, Occupant has an illusory tenancy claim. Also, Petitioner acknowledges that an occupant with a colorable claim to succession rights has standing to assert defenses in a nonpayment proceeding. (See, Rochdale Vil., Inc. v. Goode, 16 Misc 3d 49 [App Term, 2nd Dep't 2007] [holding that occupants may raise defenses they might have in nonpayment proceedings if they claim a landlord-tenant relationship under RPAPL § 711(2)]. Of note, when Respondent presented similar defenses and a similar counterclaim in their Answer, the Court denied Petitioner's motion to strike those claims in the underlying Decision. The Court reaches the same conclusion here, and denies Petitioner's motion to strike Occupant's Third, Fourth and Seventh Affirmative Defenses, as well as First Counterclaim. Again, the Court does not express any opinion as to whether Occupant will ultimately succeed on the claims.

Lastly, Occupant's Fifth Affirmative Defense concerns warranty of habitability. Every lease or rental agreement for residential use is deemed to warrant that the premises are habitable “and that the occupants [emphasis added] of such premises shall not be subjected to any conditions which would be dangerous, hazardous or detrimental to their life, health or safety.” (See, RPL § 235-b). An alleged breach of warranty of habitability is an available defense in a non-payment proceeding and can be the basis for a defense and counterclaim. [Park W. Mgt. Corp. v. Mitchell, 47 NY2d 316 (1979)]. Therefore, Petitioner's motion to strike Occupant's Fifth Affirmative Defense is denied.

As detailed above, Occupant's affirmative defenses and counterclaim are all fact intensive. The Court is presented with dueling affidavits and the parties significantly dispute nearly every factual issue. Petitioner has the burden on its motion to dismiss to establish conclusively that Occupant's defenses are not stated or have no merit. (Bank of New York v. Penalver, 125 AD3d 796, 797 [2nd Dept 2015], lv to appl dism. 26 NY3d 1030 [2015]; quoting, Vita v. New York Waste Servs., LLC, 34 AD3d 559, 559 [2006]). Petitioner has not met this high burden, and therefore the motion to strike is denied in its entirety. Occupant should have his day in Court. Testimony and cross-examination elicited at trial will afford the Court the opportunity to make determinations concerning these factual disputes, and the trial Court will have the opportunity to weigh the credibility of testimony provided.

Petitioner also seeks leave to renew and/or reargue that portion of the Court's Decision which granted Respondent leave to conduct disclosure pursuant to CPLR § 408 and which denied Petitioner's motion to strike Respondent's affirmative defenses and counterclaim concerning rent overcharge.

A motion for leave to renew must be based upon “new facts not offered on the prior motion that would change the prior determination or shall demonstrate that there has been a change in the law that would change the prior determination; and shall contain reasonable justification for the failure to present such facts on the prior motion.” (CPLR § 2221(e)). Petitioner contends that at the time Petitioner prepared the underlying motion papers, Respondent's 2018 DHCR overcharge claim remained pending, and that is why Petitioner did not provide specific calculations concerning the rent increase. Respondent subsequently withdrew the DHCR overcharge claim. Now, in a motion to renew, Petitioner has provided an affidavit which contains calculations concerning a longevity increase and vacancy increase for the premises, and which states that gut renovation work cost over $64,000.00. No contractor invoices, receipts are provided concerning same.

A motion for leave to renew should be denied unless the moving party presented a reasonable justification as to why the additional facts were not submitted on the prior motion. (See, Daria v. Beacon Capital Co., 749 NYS2d 79 [2nd Dep't 2002]). The Court is not persuaded by Petitioner's argument that a pending DHCR claim was “reasonable justification” for Petitioner's failure to present such facts on the prior motion. Petitioner's opposition to the prior motion was made by the same affiant, Yossi Goldberg, and her prior affidavit was very similar to the affidavit now presented to the Court, with the exception that new facts are now being presented concerning calculations for the rental increase. The affiant does not present a valid reason why it could not have divulged the $64,000.00 figure earlier, or why the longevity or vacancy calculations were not previously provided. Therefore, Petitioner's motion for leave to renew is denied. As the Court is also presented with a combined motion to reargue these points, the Court also grants the motion to reargue, and after argument and review of the papers the Court adheres to its December 21, 2020 Decision (“Decision”) (CPLR § 2221(f)).

The remaining arguments presented in Petitioner's motion to renew/reargue and motion to strike have been considered by the Court and are denied in their entirety. Having adhered to the Court's prior Decision, which found that discovery is warranted, Petitioner is required to provide Respondent with the demanded documents to the extent they exist by June 25, 2021.

This constitutes the Decision/Order of the Court, which shall be uploaded to NYSCEF. This proceeding will appear on the Part S virtual calendar at a date and time to be determined by the Judge presiding over Part S.

FOOTNOTES

1.   For instance, to follow Petitioner's line of argument would require the Court to retroactively treat Occupant's answer as improper when and if Respondent files an answer, irrespective of who answered first or what those answers allege. Furthermore, it would be contrary to the form Notice of Nonpayment Petition, which Petitioner utilized, which states in Paragraph 6 that “If your name is not on this Notice but you live in the home listed above, you have the right to come to Court and Answer the Petition.” (See, 22 NYCRR § 208.42(d), Exhibit A).

Julie Poley, J.