Matter of Singletary v Hernandez

[*1] Matter of Singletary v Hernandez 2005 NY Slip Op 51807(U) [9 Misc 3d 1127(A)] Decided on November 7, 2005 Supreme Court, Kings County Rivera, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 November 7, 2005
Supreme Court, Kings County

In the Matter of the application of Terri Singletary, Petitioner, For A Judgment Pursuant to Article 78 Of the Civil Practice Law and Rules -

against

Tino Hernandez, as Chairperson of the NEW YORK CITY HOUSING AUTHORITY, and ROCKHULL REDEVELOPMENT ASSOC. LP., Respondents



41644/04

Francois A. Rivera, J.

By notice of petition filed on December 23, 2004, petitioner commenced this Article 78 proceeding to challenge the termination of her Section 8 rent subsidy by respondent Tino Hernandez, Chairperson of the New York City Housing Authority (hereinafter NYCHA). Petitioner seeks a judgment reversing the termination and restoring same retroactive to the date of discontinuance. In the alternative, petitioner seeks an order directing NYCHA to serve her with an appropriate termination notice and to remand the matter for a grievance hearing on the determination to discontinue said subsidy. Petitioner also seeks a preliminary injunction staying respondent Rockhull Redevelopment Assoc. LP (hereinafter Rockhull) from bringing a non-payment proceeding against her, pending a hearing and determination of the instant Article 78 proceeding. Respondents oppose the petition. By motion filed on April 14, 2005, respondent Rockhull, sought an order permitting leave to file a late answer to Petitioner's Article 78 petition. Petitioner did not oppose Rockhull's Motion.

Petitioner commenced this proceeding by filing a notice of petition and verified petition. On February 8, 2005, Rockhull served the petitioner and NYCHA with an affirmation in opposition to petitioner's motion for injunctive relief. On March 4, 2005, NYCHA served its answer on the petitioner and Rockhull. NYCHA'a answer alleges thirty nine allegations of fact and asserts five affirmative defenses. NYCHA asserts that respondent Rockull is barred by laches from seeking retroactive subsidy payments and that the petitioner has no standing to seek [*2]that relief on Rockhull's behalf. NYCHA also asserts that petitioner's proceeding is barred by the statute of limitations and the doctrine of laches and that its determination to discontinue her subsidy was neither arbitrary nor capricious.

By decision issued March 11, 2005, this court denied petitioner's application for injunctive relief and ordered a traverse hearing on the issue of the propriety of NYCHA's service of the notice of termination of petitioner's section 8 subsidy. By decision issued April 14, 2005, this court vacated that portion of its decision of March 11, 2005 which denied petitioner's application for injunctive relief. The court then granted petitioner's request staying all housing court proceedings pending the outcome of the Article 78 proceeding. The court adjourned to April 21, 2005, the parties argument on whether conditions should be placed on the stay. On April 21, 2005, after oral argument of all parties, the court issued a decision denying Rockhull's request to vacate the order of April 14, 2005, granting petitioner's request for injunctive relief. The court, however, conditioned the stay upon petitioner's payment of use and occupancy of fifty six dollars ($56.00) monthly retroactive to December 2004. A hearing on the traversable issues raised in the pleadings was scheduled for May 2, 2005. The hearing was adjourned and conducted during the period of May 2, 6, 12, 18, June 13, July 11 and 12, 2005. The petitioner and Mr. Barry Ratzken, the manager of the Housing Authority's Leased Housing Inspection Unit of Brooklyn testified.

Petitioner, whose sole income is from SSI, has received a rent subsidy under the Section 8 Existing Housing Program from October 1994 until it was terminated on December 31, 1999. Respondent Rockhull is the lessor of petitioner's residence. Respondent Tino Hernandez is the chairperson of NYCHA. NYCHA administers a federal assistance program which provides rent subsidies for lower income families known as Section 8 Existing Housing Program ('Section 8'). Under this program, the Housing Authority serves simply as the program administrator and pays rent subsidies to participating landlords on behalf of participating tenants. In order to maintain eligibility for the program, participants must re-certify their household composition and total household income on an annual basis. See 24 C.F.R. §982.516; 24 C.F.R. §982.551(b).

Participants must also permit annual inspections of their apartments by NYCHA to assess whether they continue to meet housing quality standards. See 24 C.F.R. §982.405. If a section 8 participant fails to meet their obligations under the Section 8 program, the subsidy may be terminated by the Housing Authority. 24 §C.F.R. 982.552.

The Section 8 program is subject not only to the rules established by federal law pursuant to 42 U.S.C. §1437(f), but is also subject to a federal consent judgment (Williams v. New York City Housing Authority, 81 Civ. 1801 (R.W.) (hereinafter the "Williams Consent Judgment'), which sets forth comprehensive notice procedures which must be followed before terminating Section 8 assistance. The First Partial Consent Judgement in Williams provides that termination of the Section 8 subsidy "shall be made only after a determination in accordance with the procedures and provision herein." Those procedures, set forth at paragraphs (a), (b), and (e), provide that no fewer than three notices must be sent to the Section 8 subsidy recipient pending termination. After a preliminary determination that the recipient is subject to termination procedures, the Housing Authority must send the recipient a warning letter in Spanish and English specifically stating the basis for the termination and, if appropriate, seeking the recipient's compliance. If the conditions which led to this preliminary determination are not remedied [*3]within a reasonable time, the Housing Authority must send, by certified and regular mail, a second written notice of termination, in Spanish and English, which the Housing Authority calls the "T-1 Letter". It must provide the specific grounds for termination and inform the recipient that she may request a hearing. If the recipient does not respond to the Notice of Termination letter, the Housing Authority must mail a Notice of Default in Spanish and English, which the Housing Authority calls the "T-3 letter", to the recipient, informing her that the rent subsidy will be terminated, and advise her of the grounds for the termination. The recipient must be afforded an opportunity to request a hearing. Finally, if the recipient does not respond to the "T-3 letter", the Section 8 subsidy is terminated on the 45th calendar day following the date of mailing of the Notice of Default. However, if a recipient requests a hearing after the 45-day period, the default may be reopened "upon a showing of good cause" (See generally, the First Williams Consent Decree paragraph 22 [e]). The Williams Consent Decree requires all three notices to be sent by regular and certified mail (see Quesada v. Hernandez, 5 Misc 3d 1028 (A)[NY Sup. 2004]).

Respondent NYCHA's claims that petitioner failed to permit an annual inspection of her residence on August 2 and 17, 1999, and that although NYCHA had mailed her a notice of termination of her section 8 subsidy (hereinafter T-1) letter and notice of default (hereinafter T-3) letter, she failed to request a hearing. Accordingly, NYCHA asserts it properly terminated petitioner's benefits on December 31, 1999. NYCHA claims the aforementioned documents were mailed to petitioner at 38 Somers Street, apartment 4C, Brooklyn, New York. Annexed to NYCHA's verified answer as exhibit C was a blank form of the type ostensibly used to notify the tenant of a scheduled inspection. Annexed as exhibit D was a blank copy of the second warning notice used when the tenant fails to respond to the first notice. NYCHA asserts that the actual inspection notices are not available. Annexed as exhibit G is the front copy of the notice of termination of section 8 subsidy allegedly mailed to the petitioner. Annexed as exhibit H is the front copy of the notice of default dated October 30, 1999, allegedly mailed to the petitioner at 38 Somers Street, apartment 4C, Brooklyn, New York.

Petitioner testified that she did not receive the annual inspection notice, follow up notice, T-1 or T-3 notice letters. Petitioner claims she was unaware of the discontinuance of her Section 8 benefits until sometime in July of 2001, when Mr. Kenneth Bell, her section 8 worker, informed her of that fact. She alleges that she sent a letter dated July 10, 2001, to Mr. Anderson, the manager of leased housing, describing the problem and advising him that her residence and mailing address was 2059 Fulton Street, apartment 4C, Brooklyn, New York. She further alleges that this was one of many notices she brought to NYCHA's attention regarding the discrepancy in her mailing address.

The court will first consider and discuss the timeliness of petitioner's proceeding. CPLR §217 entitled "Proceeding against body or officer; four months," provides, in part: "Unless a shorter time is provided in the law authorizing the proceeding, a proceeding against a body or officer must be commenced within four months after the determination to be reviewed becomes final and binding upon the petitioner". It provides a four month Statute of Limitations for commencing an Article 78 proceedings against a government body or officer which runs from the time the determination to be reviewed becomes final and binding on petitioner. Petitioner commenced this proceeding on December 23, 2004. Respondent NYCHA argues that the [*4]determination became final and binding on November 4, 1999, five days after the date the Notice of Default was alleged to have been mailed, and that the Statute of Limitations expired on March 4, 2000. Paragraph 22 of the Williams Consent Judgment specifies the applicable statute of limitations to bring an Article 78 proceeding to challenge the Housing Authority's determination. Pursuant to that provision, the Housing Authority's determination to terminate a recipient's Section 8 benefits becomes final and binding upon the tenant's receipt of the T-3, notice of default letter. That same paragraph establishes a rebuttable presumption that the T-3 letter is received by the tenant within five days of mailing.

Thus, it is the date of the receipt of the notice, not the mailing of the notice, which starts the running of the four month statute of limitations period. Petitioner testified that she did not receive the notice of default. She also established that NYCHA knew or should have known that her mailing address was apartment 4C at 2059 Fulton Street and not 38 Somers Street in Brooklyn. NYCHA contends that 38 Somers street is the correct address. It, however, admits knowledge that petitioner's landlord used the 2059 Fulton Street address when it brought a housing court proceeding against the petitioner. NYCHA was therefore on notice that petitioner's residence had two addresses. The issue is whether petitioner has two mailing addresses for her residence. The court finds that what constitutes a proper mailing address is within the exclusive purview of the United Stated Postal Service. That entity was not called upon by the parties to give evidence on this issue. Petitioner testified that she only received mail addressed to 2059 Fulton Street. Her testimony on this issue was credible and sufficient to rebut the presumption of receipt of the notice of default. Consequently , the four month statute of limitations had not begun to run when she commenced this Article 78 proceeding. Her petition is therefore timely.

The court will turn to NYCHA's assertion that the doctrine of laches bar petitioner's proceeding. Laches and limitations are not the same. Limitations involve the fixed statutory periods within which actions must be brought, while laches signifies a delay independent of statute (Saratoga County Chamber of Commerce v. Pataki, 100 NY2d 801 at 816 [2003]). Laches is an equitable bar, based on a lengthy neglect or omission to assert a right and the resulting prejudice to an adverse party (Saratoga County Chamber of Commerce v. Pataki, supra.,100 NY2d 801 at 816 [2003]). The mere lapse of time, without a showing of prejudice, is insufficient to sustain a claim of laches (Saratoga County Chamber of Commerce v. Pataki, supra.). Prejudice may be demonstrated "by a showing of injury, change of position, loss of evidence, or some other disadvantage resulting from the delay (Skrodelis v. Norbergs, 272 AD2d 316, 317 [2000]). Because laches is a purely equitable defense, it will not serve to bar recovery in an action at law commenced within the limitations period (Brown v. Lockwood, 76 AD2d 721, 729 [2nd Dept. 1980]). As such, unless the legal right is barred by the Statute of Limitations, the equitable remedy is not barred by the doctrine of laches (Ecumenical Task Force of Niagra Frontier, Inc. v. Love Canal, 179 AD2d 261 at 265 [4th Dept 1992]). Inasmuch as petitioner's proceeding was timely commenced it is not barred by the doctrine of laches.

Furthermore, while indeed five years have passed since the termination of petitioner's subsidy, she was unaware of the adverse action until sometime in July of 2001. Even then, she did not know how to proceed inasmuch as she had not received notice of the right to contest the action and the manner to do so. Laches is not fairly applied to petitioner's delay in bringing this [*5]proceeding in the absence of some prejudice to the respondent, attributable to the delay. There is no such prejudice here. NYCHA' s inability to produce the original inspection notice letter, follow- up inspection letter, and the complete T-1 and T-3 letters was not caused by the delay. NYCHA's counsel has already established that the inspections notices were routinely scanned to microfilm and the hard copy destroyed a year after the recipient's benefits are discontinued. In this instance that would mean that the original notices were destroyed on or about December of 2000. Here, the loss of the scanned and microfilmed documents was not occasioned by petitioner's delay but rather by NYCHA's faulty document storage procedures. NYCHA would have been in the same position in December 2000 as they are today in the inability to produce the inspection notices and complete T-1 and T-3 letters. Accordingly, the doctrine of laches does not apply to bar the Article 78 proceeding.

Without the inspection notices and complete T-1 and T-3 notices used here, the court is prevented from assessing NYCHA's compliance with the Williams Consent Decree. There is no evidence that the inspection notices were in Spanish and English. There was also no competent evidence that the T-1 and T-3 notices were in Spanish and English. The testimony of Barry Ratzken on this issue, in the absence of the notice themselves, is insufficient. In the absence of competent evidence demonstrating NYCHA' compliance with the procedural requirements of Williams Consent Decree, the discontinuance is procedurally improper and reversed.

NYCHA asserts that the doctrine of laches should bar recovery of the terminated subsidy

by Rockhull and petitioner should not be permitted to recover the discontinued subsidy on their behalf. This argument has some merit. However, Rockhull's participation in the instant motion was limited to opposing petitioner's application for a stay of the Housing Court proceedings pending the outcome of the Article 78 proceeding. Rockhull has no standing to oppose petitioner's application for an order reversing the discontinuance of her Section 8 subsidy. It is, therefore, not a proper party to that issue in controversy. Rockhull's rights to recover rent from the petitioner and NYCHA is a matter to be determined by the Housing court and not a matter before this court.

Therefore, the stay of the Housing Court proceeding between the petitioner and Rockhull is continued solely for forty-five (45) days from the date of this decision and order. It is anticipated that NYCHA and petitioner may use this time to sort out and calculate the amount of section 8 subsidy arrears at stake. NYCHA is, of course, at liberty to intervene in the aforementioned Housing Court proceeding and assert any defenses it deems appropriate. However, to the extent petitioner is found liable for rent arrears caused by the discontinuance of her Section 8 subsidy, NYCHA is directed to cover those arrears to the extent necessary to retain petitioner's tenancy retroactive to the date of discontinuance.

The foregoing constitutes the decision and order of this court.

-x

J.S.C.