Landlord & Tenant

AppDiv, First Dept.

(memorandum opinion)

In subsidized tenant's article 78 proceeding against the Department of Housing Preservation and Development (HPD), tenant challenged HPD's grant of a certificate of eviction. The Appellate Division confirmed the determination and denied the petition, holding that eviction was not a disproportionate remedy for tenant's misconduct.

Tenant's daughter lived with her in the subsidized apartment, and the daughter's income would be used to determine tenant's rent. Although tenant's daughter was employed during 2008, 2009, and 2010, tenant submitted data to HPD indicating that she was not employed. After a hearing (at which tenant was represented by counsel), HPD determined that in light of the falsifications, eviction was warranted. Tenant then brought this article 78 proceeding.

In confirming HPD's determination, the Appellate Division concluded that tenant's explanation ' that she was ill from 2007 to 2008 and was therefore unaware of her daughter's employment ' was incredible. The court noted the shortage of public housing, and held that in light of the waiting lists for housing, termination of the tenancy for repeated disregard for HPD's rules was not a disproportionate sanction.

Landlord Waived Claim

45 Broadway Owner LLC v. NYSA-ILA Pension Trust Fund

NYLJ 7/1/13, p. 20, col. 3

AppDiv, First Dept.

(memorandum opinion)

In landlord's action for damages incurred in a flood caused by tenant's negligent maintenance of its supplemental HVAC system, tenant appealed from Supreme Court's award of summary judgment to landlord. The Appellate Division reversed and dismissed landlord's claims, holding that by the terms of the lease, landlord and tenant had waived claims against each other for losses like the one that occurred, opting instead to provide for those losses through insurance.

Tenant's predecessor installed the supplemental HVAC system, and it remained in operation when tenant took possession in 2002. In 2010, when landlord asked all tenants to shut down supplemental HVAC systems in order to facilitate a shutdown of the building's water condenser, several floors of the building flooded, apparently because a rusted gauge on tenant's HVAC system had burst. Landlord spent $76,760.14 on repairs and offered other tenants $60,000 in concessions to compensate for damages. Landlord then brought this action against tenant.

The dispute centered on a provision in the parties' lease under the terms of which each party waived any claim it might have against the other for “loss, damage or destruction with respect to its property by fire or other casualty.” The issue was whether the flood caused by the rusted gauge was a “casualty” within the meaning of the lease provision. Supreme Court awarded summary judgment to landlord, and tenant appealed.

In reversing, the Appellate Division rejected the argument that only “acts of God” qualified as casualties within the meaning of the lease provision. The court noted that the same provision governed “fires” as well as “casualties,” and that fires can be caused by human error as well as acts of God. As a result, the court held that the casualty in this case was covered by the lease's waiver of claims provision, which left the parties to seek recovery from their insurers.

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Federal Court Lacks Jurisdiction

180 Varick LLC v. Think Passenger

NYLJ 6/27/13, p. 21, col. 3

U.S.Dist Ct., S.D.N.Y

(Forrest, J.)

In a commercial summary nonpayment proceeding removed to federal court by tenant, landlord moved to remand to Civil Court. The federal district court granted the motion, concluding that it lacked jurisdiction to hear the dispute, and that in any event, abstention was appropriate.

Commercial landlord brought this nonpayment proceeding in Civil Court, contending that tenant had failed to pay rent and expenses since Jan. 1, 2013. Landlord sought rent arrears and eviction. The parties concede that the value of the relief sought by landlord exceeds $75,000. Tenant filed a Notice of Removal to federal court based on diversity of citizenship and, in its answer, asserted counterclaims related to the $194,400 security deposit retained by landlord. Landlord then moved for remand to state court.

In granting landlord's motion, the court first held that federal district court lacks jurisdiction to hear summary proceedings. The court noted that New York's summary proceedings are designed to afford landlords a streamlined process, and held that federal courts lack jurisdiction to entertain a case involving a streamlined process that would eliminate the discovery and motion practice typically permitted in federal court. The court then held that even if removal were otherwise proper, federal courts should abstain from hearing landlord-tenant cases that do not implicate any federal rights.

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Eviction Not a Disproportionate Remedy

Matter of Auguste v. Wambua

NYLJ 7/1/13, p. 19, col. 2

AppDiv, First Dept.

(memorandum opinion)

In subsidized tenant's article 78 proceeding against the Department of Housing Preservation and Development (HPD), tenant challenged HPD's grant of a certificate of eviction. The Appellate Division confirmed the determination and denied the petition, holding that eviction was not a disproportionate remedy for tenant's misconduct.

Tenant's daughter lived with her in the subsidized apartment, and the daughter's income would be used to determine tenant's rent. Although tenant's daughter was employed during 2008, 2009, and 2010, tenant submitted data to HPD indicating that she was not employed. After a hearing (at which tenant was represented by counsel), HPD determined that in light of the falsifications, eviction was warranted. Tenant then brought this article 78 proceeding.

In confirming HPD's determination, the Appellate Division concluded that tenant's explanation ' that she was ill from 2007 to 2008 and was therefore unaware of her daughter's employment ' was incredible. The court noted the shortage of public housing, and held that in light of the waiting lists for housing, termination of the tenancy for repeated disregard for HPD's rules was not a disproportionate sanction.

Landlord Waived Claim

45 Broadway Owner LLC v. NYSA-ILA Pension Trust Fund

NYLJ 7/1/13, p. 20, col. 3

AppDiv, First Dept.

(memorandum opinion)

In landlord's action for damages incurred in a flood caused by tenant's negligent maintenance of its supplemental HVAC system, tenant appealed from Supreme Court's award of summary judgment to landlord. The Appellate Division reversed and dismissed landlord's claims, holding that by the terms of the lease, landlord and tenant had waived claims against each other for losses like the one that occurred, opting instead to provide for those losses through insurance.

Tenant's predecessor installed the supplemental HVAC system, and it remained in operation when tenant took possession in 2002. In 2010, when landlord asked all tenants to shut down supplemental HVAC systems in order to facilitate a shutdown of the building's water condenser, several floors of the building flooded, apparently because a rusted gauge on tenant's HVAC system had burst. Landlord spent $76,760.14 on repairs and offered other tenants $60,000 in concessions to compensate for damages. Landlord then brought this action against tenant.

The dispute centered on a provision in the parties' lease under the terms of which each party waived any claim it might have against the other for “loss, damage or destruction with respect to its property by fire or other casualty.” The issue was whether the flood caused by the rusted gauge was a “casualty” within the meaning of the lease provision. Supreme Court awarded summary judgment to landlord, and tenant appealed.

In reversing, the Appellate Division rejected the argument that only “acts of God” qualified as casualties within the meaning of the lease provision. The court noted that the same provision governed “fires” as well as “casualties,” and that fires can be caused by human error as well as acts of God. As a result, the court held that the casualty in this case was covered by the lease's waiver of claims provision, which left the parties to seek recovery from their insurers.

'

Federal Court Lacks Jurisdiction

180 Varick LLC v. Think Passenger

NYLJ 6/27/13, p. 21, col. 3

U.S.Dist Ct., S.D.N.Y

(Forrest, J.)

In a commercial summary nonpayment proceeding removed to federal court by tenant, landlord moved to remand to Civil Court. The federal district court granted the motion, concluding that it lacked jurisdiction to hear the dispute, and that in any event, abstention was appropriate.

Commercial landlord brought this nonpayment proceeding in Civil Court, contending that tenant had failed to pay rent and expenses since Jan. 1, 2013. Landlord sought rent arrears and eviction. The parties concede that the value of the relief sought by landlord exceeds $75,000. Tenant filed a Notice of Removal to federal court based on diversity of citizenship and, in its answer, asserted counterclaims related to the $194,400 security deposit retained by landlord. Landlord then moved for remand to state court.

In granting landlord's motion, the court first held that federal district court lacks jurisdiction to hear summary proceedings. The court noted that New York's summary proceedings are designed to afford landlords a streamlined process, and held that federal courts lack jurisdiction to entertain a case involving a streamlined process that would eliminate the discovery and motion practice typically permitted in federal court. The court then held that even if removal were otherwise proper, federal courts should abstain from hearing landlord-tenant cases that do not implicate any federal rights.

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