Landlord & Tenant

Landlord Not Entitled to Possession Without Showing That Apartment Could Not Be Legalized

C & E Associates, LLC v. Hernandez

NYLJ 5/21/08, p. 27, col. 1

Civil Ct., N.Y. Cty

(Schneider, J.)

In landlord's summary holdover proceeding, tenant sought summary judgment. The court granted tenant's motion, holding that because landlord had not established that the subject apartment could not be legalized, landlord was not entitled to terminate tenant's tenancy.

When landlord bought the subject building in 1998, the subject basement apartment was not registered with DHCR, even though landlord's predecessor had rented the apartment. The remainder of the apartments in the building were registered as rent stabilized. Landlord continued the practice of its predecessor, and rented out the basement apartment without a lease. In 2005, landlord rented the apartment to the current tenant. In March 2007, the Department of Buildings issued a violation for the apartment, and imposed a $500 fine. The violation was for construction of the three-room apartment without obtaining the necessary permits. After receiving the violation, landlord served tenant with a 30-day notice terminating her month-to-month tenancy, and brought this holdover proceeding.

In dismissing the proceeding, the court emphasized that the absence of a lease did not exempt the apartment from rent stabilization coverage. Moreover, the court noted that the fact of illegal occupation did not, by itself entitle landlord to terminate a rent-stabilized tenancy. Instead, the court noted that landlord is entitled to terminate a rent-stabilized tenancy only when tenant's occupation cannot be legalized, as when zoning does not permit residential occupancy. In this case, landlord had made no showing that the apartment could not be legalized, and landlord could not, therefore, prevail in this holdover proceeding.

Tenant Failed to Exercise Renewal Option

410 BPR Corp. v. Chmelecki Asset Management, Inc.

NYLJ 5/22/08, p. 42, col. 4

AppDiv, Second Dept.

(memorandum opinion)

In tenant's action for a judgment that it had properly exercised its option to renew a lease, landlord appealed from the Supreme Court's denial of its motion for partial summary judgment. The Appellate Division reversed, holding that tenant had not exercised an option to renew.

Landlord had leased the subject property to tenant. The lease included a rider giving tenant an option to renew “for an additional term to be agreed upon by the parties.” The rider also provided that the parties would renegotiate rent and security for any renewal term six months before expiration of the lease. Before expiration of the lease, the parties negotiated for a renewal, and various writings were exchanged, but no formal agreement was consummated. Tenant remained in possession after expiration of the lease and sent landlord checks for an increased rent as provided in one of landlord's renewal offers. Ultimately, however, landlord ended the negotiations, returned all checks for periods after the expiration of the lease, and served tenant with a 30-day notice of termination. Tenant then brought this declaratory judgment action seeking a determination that it had properly exercised its renewal option. Landlord sought summary judgment, relying in part on the statute of frauds. The Supreme Court denied landlord's summary judgment motion.

In reversing, the Appellate Division relied on the statute of frauds. The court held that the renewal rider in the original lease was an unenforceable agreement to agree, and noted further that tenant had not submitted any written proof to support its position that the parties had reached a mutual understanding and agreement regarding the terms of a renewal lease. Further, because tenant had failed to show that the parties had ever reached an oral agreement, the doctrine of part performance would not take the alleged agreement outside the scope of the statute of frauds. As a result, landlord was entitled to partial summary judgment declaring that tenant had not renewed the lease.

Yellowstone Injunctions Available to Residential Tenants

Hopp v. Raimondi

NYLJ 5/22/08, p. 44, col. 1

AppDiv, Second Dept.

(memorandum opinion)

In an action by residential tenant for a judgment declaring that she had not violated the terms of a residential lease, tenant appealed from the Supreme Court's denial of her motion for a Yellowstone injunction. The Appellate Division reversed and granted the injunction, holding that outside of New York City, such injunctions are available to protect residential tenants.

Tenant has resided in the subject rent-controlled apartment in Bronxville since 1967. The building was converted to co-operative ownership in the 1980s, but tenant did not purchase the shares associated with her apartment. Current landlord purchased the shares and the proprietary lease in 2003. In 2007, landlord served tenant with a notice to cure and surrender possession, alleging that tenant had violated the terms of the lease by changing the lock to the apartment and failing to provide landlord with a key. Before expiration of the cure period, tenant brought this action for a declaration that she had not violated the terms of the lease. She also sought a Yellowstone injunction. The Supreme Court denied the Yellowstone injunction, holding that Yellowstone relief is available only to commercial tenants or to residential tenants who also own the share designated for their co-operative units. Tenant appealed.

In reversing, the Appellate Division noted that the purpose of a Yellowstone injunction is to allow a tenant confronted with a threat of termination of the lease to obtain a determination on the merits without risk of forfeiture of the leasehold. The court noted that RPAPL 753(4), which affords New York City residential tenants a 10-day cure period after a determination that tenant has violated the lease, has made Yellowstone injunctions largely unnecessary for residential tenants within the city. But the court emphasized that outside the city, Yellowstone relief is the only remedy available to a residential tenant seeking to protect a tenancy while challenging landlord's allegation of a lease violation. The court declined to limit Yellowstone relief to commercial tenants and to owners of co-op apartments, holding that the relief is available to ordinary residential tenants, as well.

Landlord Not Entitled to Possession Without Showing That Apartment Could Not Be Legalized

C & E Associates, LLC v. Hernandez

NYLJ 5/21/08, p. 27, col. 1

Civil Ct., N.Y. Cty

(Schneider, J.)

In landlord's summary holdover proceeding, tenant sought summary judgment. The court granted tenant's motion, holding that because landlord had not established that the subject apartment could not be legalized, landlord was not entitled to terminate tenant's tenancy.

When landlord bought the subject building in 1998, the subject basement apartment was not registered with DHCR, even though landlord's predecessor had rented the apartment. The remainder of the apartments in the building were registered as rent stabilized. Landlord continued the practice of its predecessor, and rented out the basement apartment without a lease. In 2005, landlord rented the apartment to the current tenant. In March 2007, the Department of Buildings issued a violation for the apartment, and imposed a $500 fine. The violation was for construction of the three-room apartment without obtaining the necessary permits. After receiving the violation, landlord served tenant with a 30-day notice terminating her month-to-month tenancy, and brought this holdover proceeding.

In dismissing the proceeding, the court emphasized that the absence of a lease did not exempt the apartment from rent stabilization coverage. Moreover, the court noted that the fact of illegal occupation did not, by itself entitle landlord to terminate a rent-stabilized tenancy. Instead, the court noted that landlord is entitled to terminate a rent-stabilized tenancy only when tenant's occupation cannot be legalized, as when zoning does not permit residential occupancy. In this case, landlord had made no showing that the apartment could not be legalized, and landlord could not, therefore, prevail in this holdover proceeding.

Tenant Failed to Exercise Renewal Option

410 BPR Corp. v. Chmelecki Asset Management, Inc.

NYLJ 5/22/08, p. 42, col. 4

AppDiv, Second Dept.

(memorandum opinion)

In tenant's action for a judgment that it had properly exercised its option to renew a lease, landlord appealed from the Supreme Court's denial of its motion for partial summary judgment. The Appellate Division reversed, holding that tenant had not exercised an option to renew.

Landlord had leased the subject property to tenant. The lease included a rider giving tenant an option to renew “for an additional term to be agreed upon by the parties.” The rider also provided that the parties would renegotiate rent and security for any renewal term six months before expiration of the lease. Before expiration of the lease, the parties negotiated for a renewal, and various writings were exchanged, but no formal agreement was consummated. Tenant remained in possession after expiration of the lease and sent landlord checks for an increased rent as provided in one of landlord's renewal offers. Ultimately, however, landlord ended the negotiations, returned all checks for periods after the expiration of the lease, and served tenant with a 30-day notice of termination. Tenant then brought this declaratory judgment action seeking a determination that it had properly exercised its renewal option. Landlord sought summary judgment, relying in part on the statute of frauds. The Supreme Court denied landlord's summary judgment motion.

In reversing, the Appellate Division relied on the statute of frauds. The court held that the renewal rider in the original lease was an unenforceable agreement to agree, and noted further that tenant had not submitted any written proof to support its position that the parties had reached a mutual understanding and agreement regarding the terms of a renewal lease. Further, because tenant had failed to show that the parties had ever reached an oral agreement, the doctrine of part performance would not take the alleged agreement outside the scope of the statute of frauds. As a result, landlord was entitled to partial summary judgment declaring that tenant had not renewed the lease.

Yellowstone Injunctions Available to Residential Tenants

Hopp v. Raimondi

NYLJ 5/22/08, p. 44, col. 1

AppDiv, Second Dept.

(memorandum opinion)

In an action by residential tenant for a judgment declaring that she had not violated the terms of a residential lease, tenant appealed from the Supreme Court's denial of her motion for a Yellowstone injunction. The Appellate Division reversed and granted the injunction, holding that outside of New York City, such injunctions are available to protect residential tenants.

Tenant has resided in the subject rent-controlled apartment in Bronxville since 1967. The building was converted to co-operative ownership in the 1980s, but tenant did not purchase the shares associated with her apartment. Current landlord purchased the shares and the proprietary lease in 2003. In 2007, landlord served tenant with a notice to cure and surrender possession, alleging that tenant had violated the terms of the lease by changing the lock to the apartment and failing to provide landlord with a key. Before expiration of the cure period, tenant brought this action for a declaration that she had not violated the terms of the lease. She also sought a Yellowstone injunction. The Supreme Court denied the Yellowstone injunction, holding that Yellowstone relief is available only to commercial tenants or to residential tenants who also own the share designated for their co-operative units. Tenant appealed.

In reversing, the Appellate Division noted that the purpose of a Yellowstone injunction is to allow a tenant confronted with a threat of termination of the lease to obtain a determination on the merits without risk of forfeiture of the leasehold. The court noted that RPAPL 753(4), which affords New York City residential tenants a 10-day cure period after a determination that tenant has violated the lease, has made Yellowstone injunctions largely unnecessary for residential tenants within the city. But the court emphasized that outside the city, Yellowstone relief is the only remedy available to a residential tenant seeking to protect a tenancy while challenging landlord's allegation of a lease violation. The court declined to limit Yellowstone relief to commercial tenants and to owners of co-op apartments, holding that the relief is available to ordinary residential tenants, as well.