Goldman v Malagic

[*1] Goldman v Malagic 2014 NY Slip Op 24264 Decided on September 16, 2014 Appellate Term, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the printed Miscellaneous Reports.

Decided on September 16, 2014
SUPREME COURT, APPELLATE TERM, FIRST DEPARTMENT
PRESENT: Lowe, III, P.J., Schoenfeld, Hunter, Jr., JJ.
570595/13

J.H. Goldman, A.H. Goldman, A.P. Goldman, D.G. Kemper, as Executors for the Estate of Lillian Goldman and the Lillian Goldman Family Trust, Petitioner-Landlord-Respondent,

against

Omer Malagic, Respondent-Tenant-Appellant, -and- John Doe and/or Jane Doe, Respondents-Undertenants.

Tenant, as limited by his briefs, appeals from that portion of an order of the Civil Court of the City of New York, New York County (Laurie L. Lau, J.), dated December 14, 2012, which, upon submission on stipulated facts, dismissed his rent overcharge claims in a nonpayment summary proceeding.

Per Curiam.

Order (Laurie L. Lau, J.), dated December 14, 2012, reversed, with $10 costs, and matter remanded for further proceedings consistent with this decision.

Landlord commenced the within nonpayment summary proceeding to recover rent arrears of over $17,000, upon a verified petition acknowledging (at paragraph 9) that the demised apartment is "presently subject" to rent stabilization and that the rent demanded "does not exceed the lawful stabilized rent." In response, tenant-appellant's amended answer asserted claims for rent overcharge and treble damages. The parties stipulated to have the trial court determine "the legal rent" and whether "there is any overcharge" based on certain agreed facts as well as submitted documents. The stipulated facts included the following: that appellant initially took occupancy of the apartment in 1994 as an incident of his employment as the building's superintendent; that appellant's employment was terminated in October 2007; and that appellant thereafter remained in occupancy of the apartment pursuant to a series of unregulated lease agreements, the first of which fixed the rent at $2,000 per month, with a preferential rent of $1,500. On these stipulated facts, the trial court determined that no overcharge had occurred based upon its conclusion that the parties were "free to negotiate a rent of their choosing" upon [*2]the severance of their employment relationship and that their "agreement to a rent of $2,000.00 deregulated the apartment as a matter of law." Tenant now appeals, and we reverse.

The allegations contained in paragraph 9 of the landlord's verified petition constituted formal judicial admissions that the apartment in question was subject to rent stabilization coverage and that the rent sought therein was a "lawful stabilized rent," admissions which were "binding and conclusive" as against landlord (Bogoni v Friedlander, 197 AD2d 281, 292 [1994], lv denied 84 NY2d 803 [1994]; see Jerome Prince, Richardson on Evidence § 8-215, at 523-524 [Farrell 11th ed]), and which landlord should not have been permitted to disavow in its stipulated submission below. Nor is the court's coverage determination sustainable on the merits. Consistent with the regulatory allegations set out in landlord's pleading, the apartment, though temporarily exempt from rent stabilization during the period of appellant's employ (see Rent Stabilization Code [9 NYCRR] § 2520.11[m]), reverted back to its prior (conceded) stabilized status when the landlord accepted appellant as a tenant in his own right after his stint as superintendent had ended (see 656 Realty, LLC v Cabrera, 27 Misc 3d 1225[A] [Civ Ct NY County 2009], affd 27 Misc 3d 138[A], 2010 NY Slip Op 50899[U] [App Term, 1st Dept 2010]).

Landlord's reliance on Rent Stabilization Code (9 NYCRR) § 2526.1(a)(3)(iii)[FN1] as a basis to destabilize the apartment is misplaced, since the language of that section "necessarily presumes that the first tenant after a vacancy is offered a rent stabilized lease" (Gordon v 305 Riverside Corp., 93 AD3d 590, 592 [2012]), a contingency which was not satisfied here, even were we to assume that the apartment became "vacant" within the meaning of the Code provision when appellant, in occupancy throughout, assumed the role of a tenant upon his termination as superintendent (but see Blumenthal v Chung Fo Lam, 17 Misc 3d 233, 236, n 4 [2007]). Nor are we persuaded to follow the single DHCR precedent cited by landlord in resolving the issues framed on this appeal, which involve matters of pure statutory interpretation (see Matter of KSLM-Columbus Apts., Inc. v New York State Div. of Hous. and Community Renewal, 5 NY3d 303, 312 [2005]).

In view of the truncated nature of the proceedings below, we leave for another day, with a more complete record, resolution of the remaining issues raised by the parties' stipulation of facts, including the proper method of determining the legal regulated rent and the amount, if any, of a rent overcharge award.

THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.

I concur I concur I concur

Decision Date: September 16, 2014

Footnotes

Footnote 1:The cited Code section provides that "[w]here a ~~housing accommodation is vacant . . . on the base date, ~~the legal regulated rent shall be the rent agreed to by ~~the owner and the first rent stabilized tenant taking ~~occupancy after such vacancy . . . , and reserved in a ~~lease or rental agreement."