IN RE: the Application of HAZEL TOWERS (1997)

Order, Supreme Court, Bronx County (Anita Florio, J.), entered December 8, 1993, which dismissed the petition upon finding that it was barred on grounds of res judicata and collateral estoppel, by this court's decision in K.S.L.M.-Columbus Apartments and Hazel Towers, Inc. v. Higgins and the NYS DHCR, 181 A.D.2d 639, 581 N.Y.S.2d 1005, lv denied 80 N.Y.2d 760, 591 N.Y.S.2d 138, 605 N.E.2d 874, unanimously reversed to the extent appealed from, on the law, without costs, the respondents' cross-motion is denied, and the petition is reinstated.

Notwithstanding the fact that the petitioners brought a prior action challenging the regulations governing the procedures for dissolution, neither the doctrine of res judicata nor the doctrine of collateral estoppel precludes this administrative proceeding seeking to compel the Division of Housing and Community Renewal to issue a certificate of no objection upon petitioners' proper filing of a certificate of dissolution.

 Although arising out of the attempted dissolution of the housing company, the instant challenge is distinguishable from the earlier facial challenge of the regulations in that the present claims specifically accrued upon the April 29, 1991 refusal of the agency to issue a certificate of no objection (Matter of Hodes v. Axelrod, 70 N.Y.2d 364, 372-73, 520 N.Y.S.2d 933, 515 N.E.2d 612 [explaining “transactional test” for claim preclusion] ).   None of the rights or interests established in the prior action can be destroyed or impaired by determinations made here.

 Collateral estoppel is similarly inapplicable because the agency's determination was not rendered until after summary judgment motions were filed in the prior litigation, and the petitioner formerly did not have an opportunity to raise any of the issues which accrued by virtue of the April 29th letter (see, Continental Casualty Co. v. Rapid-American Corp., 80 N.Y.2d 640, 649-50, 593 N.Y.S.2d 966, 609 N.E.2d 506).   The petition should be reinstated.

MEMORANDUM DECISION.