Jonassen v Kirtland

[*1] Jonassen v Kirtland 2009 NY Slip Op 51838(U) [24 Misc 3d 1241(A)] Decided on August 26, 2009 Ithaca City Court Kerrigan, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on August 26, 2009
Ithaca City Court

Sara Jonassen, Plaintiff

against

Judith Kirtland and Edward Kirtland, Defendant.



C09-40726

James Kerrigan, J.

Tenant Plaintiff in small claims court seeks the return of $1800, prepaid two months rent and a security deposit on a leased apartment which she occupied for less than five days. The landlord's counterclaim seeks recovery of $5,000, the small claims court jurisdictional maximum, Uniform City Court Act Section 1801, claiming that the lease provisions entitle the landlord to the full year's rent in the event of any breach by the tenant.

The facts are simple and straight-forward. After signing the landlord's 7-page lease drafted by the landlord's counsel, tenant took possession on May 1. The apartment is a recently renovated full floor unit of a ranch house. Paragraph 9 of the lease states that the tenant has inspected the premises and takes the premises "as is". The tenant moved in on May 2, the date that the landlord was applying sealer on newly installed tile. Tenant claimed that she could not tolerate the strong fumes and that she could not properly ventilate the apartment because a number of windows were either without screens or painted shut. The Court credits the landlord's testimony that although some of the windows may have been sticky they were easily opened. The tile sealant fumes did not rise to the level of being the dangerous or hazardous conditions detrimental to life, health or safety required as a predicate for New York's Warranty of Habitability statute, Real Property Law §235-b. Further, the Court credits the landlord's testimony that while some of the windows may have lacked screens and that some of the windows may have been sticky, it was relatively simple for the landlord to open the windows and ventilate the apartment. At most, the tenants would have been entitled to a few days reduction in the rent while the fumes dissipated. Tenant, after notice to the landlord, may make repairs and set off or deduct such expenses from the rent, a rent abatement, on these facts. (see Park West Mgt Corp v Mitchell, 47 NY2d 316 [1979], Jangla Realty Company v Gravagna, 112 Misd2d 642 [NY City Civil Court, 1981]). On proof in this case, the Court finds the tenant to be entitled to three days rent abatement or $70. Landlord is entitled to rent for the balance of May.

Turning to the counterclaim, the tenant signed a twelve month lease obligating her to pay $8400 for the full year. She moved out after three days as a result of headaches from fumes which did not rise the level of inhabitability. With the benefit of hindsight perhaps she should have asked the landlord to open the stuck windows, or bought a fan, (there were at least two working ventilation fans in the apartment) or taken a hotel room until the fumes abated. [*2]

Instead, she moved into her car, lacking first month, last month, and a security deposit on a new rental. She testified she continued to reside in her car until the date of the trial. The Landlords, one of whom is a realtor, left the premises vacant and indicated that the premises could be re rented immediately at the same or a higher rent once the property was advertised. At the trial, some six weeks after the tenant moved out the Landlords testified they had made no efforts to rent the apartment. The legal question is whether a landlord can do nothing, take no steps to minimize the damages, and collect the full year's rent which they seek to do on their counterclaim, limited at this time to small claims court's monetary jurisdiction.

The Court of Appeals in Holy Properties Ltd v. Kenneth Cole (87 NY2d 130 [1995]) has held that a landlord has no obligation to mitigate damages: "Once the tenant abandoned the premises prior to the expiration of the lease, however, the landlord was within its rights under New York law to do nothing and collect the full rent under the lease." (Id. at 134 [citations omitted]). This small claims court must apply the law applicable to a $20,000 a month store front on West 57th Street, a block from Fifth Avenue, to an apartment in the hamlet of Brooktondale, New York formerly rented by a now homeless young woman. Holy Properties affirmed a judgment for $781,000 based on the need for certainty in rules applicable to interests in real property dating to feudal times. This tenant is living in a car because she lacks the resources to rent another apartment for a few hundred dollars a month. An apartment in a county with a low vacancy rate sits empty and unused. Kenneth Cole Productions is a New York Stock Exchange listed company with a 2009 market capitalization, dramatically reduced by the current recession and stock market collapse, to a mere $180 million dollars. Kenneth Cole Productions Ltd, represented by lawyers and brokers, negotiated and then made a conscious business decision to walk away from a commercial lease. This tenant signed a 7 page lease as drafted by the landlords attorney with no changes whatsoever. The Court of Appeals tells us : "In business transactions, particularly, the certainty of settled rules is often more important than whether the established rule is better than another or even whether it is the correct' rule" (Id. at 134 [citation omitted]).

The Second Department, in Rios v. Carrillo (53 AD3d 311 [2008]), has held that the Holy Properties rule is applicable to residential leases and remanded that case to the trial court to examine other unresolved issues such as the landlord's acceptance of the surrender of the leasehold. This court is obligated to follow the rulings of the Court of Appeals and the Second Department even in seeking to do substantial justice under our small claims statute. Uniform City Court Act §1804. This court must follow the ruling of an Appellate Division, People v. Brisotti, 169 Misc 2d 672 (App.Term, 1st Dept, [1996]).

Although it is impossible to be sure how trial, housing and small claims courts are handling such claims daily, we are beginning to see in the few reported decisions that lower courts are straining to avoid the harshness of the Holy Properties and Rios rules when they find other rules to apply. In 88th Street Realty L.P. v. Maher (21 Misc 3d 190 [2008]) the New York City Civil Court could not in good conscience award such damages where the landlord waited a couple of months to proceed. In Saliva v. Dyer (21 Misc 3d 140 A [S.Ct. App. Term, 9th & 10th Jud. Dists, 2008], [table, text at 2008 WL 5004312]), an unreported appellate decision of the Supreme Court, Appellate Term deferred to Small Claims Court's substantial justice rubric in affirming an award to tenant of the security deposit to be returned. Rochester City Court, [*3]Hamblin v. Bachman (23 Misc 3d 1116[A], [table , text at 2009 WL 1086779]) another reported unreported decision, found the landlord, by advertising the abandoned tenancy and making repairs, accepted a surrender of the premises. This landlord's lease has clauses in ¶20 D authorizing the landlord to re-let the premises and reduce this tenants obligations net of the costs of re-renting making the counterclaim premature..

If and when the Legislature considers this question, (see Faleck, Landlord's Duty to Mitigate: Cases Highlight Need for Legislative Action, NYLJ June 30 2009, at 4. col 4, noting that 42 states and the District of Columbia have imposed a duty to mitigate upon landlords) this court must apply the law as it exists now. (see also Vaeth, Landlord 's Duty, on Tenants Failure to Occupy, or Abandonment of, Premises, to Mitigate Damages by Accepting or Procuring Another Tenant, or 75 ALR 5th 1 [2000]).

Feudal real property concepts are significant to seasoned real property lawyers negotiating a lease with brokers for commercial multi-million dollar parties, but are inappropriate to consumer lease rules where a tenant is homeless and a landlord can re let the property without effort in a tight market.

The landlord defendants are entitled to May rent, prepaid, and the tenant is entitled to Judgment for the three days abated, $70, and the return of the $400 pet deposit since no pet lives there and the return of the last month's rent. A years' rent for three days occupancy is unconscionable as a matter of law and fact. Real Property Law §235-c; Knudsen v Lax, 17 Misc 2d 350 (Watertown City Court, 2007). Judgment to Plaintiff for $1,170.

Dated: August 26, 2009

JAMES M. KERRIGAN

Ithaca City Court Judge