170 W. 85th St. Hous. Dev. Fund Corp. v Marks

[*1] 170 W. 85th St. Hous. Dev. Fund Corp. v Marks 2013 NY Slip Op 51332(U) Decided on June 10, 2013 Civil Court Of The City Of New York, New York County Stoller, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 June 10, 2013
Civil Court of the City of New York, New York County

170 West 85th Street Housing Development Fund Corporation, Petitioner,

against

Jeanette Marks, and THOMAS MARKS, Respondents/Tenants.



59106/2012

Jack Stoller, J.

170 West 85th Street, Housing Development Fund Corporation, the petitioner in this proceeding ("the cooperative"), commenced this summary proceeding against Jeanette Marks and Thomas Marks, the respondents in this proceeding (collectively, "Respondents"), seeking possession of 170 West 85th Street, Apt. 5WF, New York, New York ("the subject premises") on the ground of nonpayment of rent.

Respondents initially answered the proceeding while pro se. Respondents subsequently retained counsel, who served and filed another answer after the time had passed to amend the answer as of right. Respondents did not designate the new answer as amended answer, nor did Respondents move for leave to amend their answer. More than three months after Respondents' new answer was filed, the cooperative served a reply to counterclaims raised in the new answer, compelling the conclusion that the cooperative had retained the answer all that time.[FN1] The retention of an answer without objection constitutes a waiver of objection as to its timeliness. Jordan v. Aviles, 289 AD2d 532, 533 (2nd Dept. 2001), Phillips v. League for the Hard of Hearing, 254 AD2d 181 (1st Dept. 1998), Wittlin v. Schapiro's Wine Co., 178 AD2d 160 (1st Dept. 1991). Accordingly, the Court deems the subsequent answer filed by Respondents' counsel to be the answer in this matter. Issue being joined, the Court held a trial on this matter over several dates.

At trial, the cooperative proved that it is a proper party to commence this proceeding pursuant to RPAPL §721; that it is a Housing Development Finance Corporation ("HDFC") pursuant to Article XI of the Private Housing Finance Law, and accordingly is a residential cooperative corporation, and thus exempt from Rent Stabilization pursuant to 9 N.Y.C.R.R. §2520.11(1); that it had registered the building with the Department of Housing Preservation and [*2]Development of the City of New York ("HPD") pursuant to MDL §325(1); that the cooperative and respondent Jeanette Marks are parties to a proprietary lease pertaining to the subject premises; and that the cooperative demanded rent prior to the commencement of this proceeding pursuant to RPAPL §711(2).

The cooperative also established at trial that the monthly maintenance for the subject premises is $243.00 and that Respondents have not paid monthly maintenance since approximately 1990. In addition to that, co-respondent Thomas Marks testified on the cooperative's case [FN2] that respondent Jeanette Marks, the shareholder of the shares appurtenant to the subject premises, has not been residing at the subject premises and that he has been residing there. However, no evidence was introduced at trial indicating that co-respondent Thomas Marks is a shareholder of the cooperative, nor that the cooperative has accepted co-respondent Thomas Marks as a shareholder. Another witness for the cooperative, the treasurer of the cooperative, testified that he has resided at the building in which the subject premises is located for more than thirty years, has known respondent Jeanette Marks, and that she has not resided at the subject premises for at least twenty years.

Co-respondent Thomas Marks testified on Respondents' case. Co-respondent Thomas Marks testified that he has lived in the subject premises for his entire life; that he attempted to tender one months' maintenance of $243.00 at some unspecified date "about" more than ten years ago, and that a prior officer of the cooperative returned the payment to him with a note that said "this is being returned to you and you know why" and that he didn't know why; that he has had an ongoing issue with regard to a leak in the bathroom of the subject premises that required numerous repairs undertaken by a contractor for the cooperative, according to which the contractor had to open up the wall to remedy a leak going into the shower and the bathtub and that the living room ceiling collapsed due to a leaky roof; that he had some communication with officers of the cooperative in December of 2011 about these conditions; and that the cooperative repaired the condition on or about mid-summer of 2012.

At the conclusion of Petitioner's prima facie case, Respondents moved to dismiss on the ground that the facts alleged in the petition, in particular that part of the petition that alleged that respondent Jeanette Marks is a tenant of the subject premises according to a monthly rental agreement, were not proven at trial. The petition in this matter alleges that respondent Jeanette Marks is a tenant of the subject premises pursuant to a monthly rental agreement made on or about February of 2002 according to which respondent Jeanette Marks agreed to pay a monthly rent of $243.00. It is not disputed that the statement of the petition is incorrect, given that the evidence at trial showed that respondent Jeanette Marks is a party to a proprietary lease, not a month-to-month tenant. Recognizing the incongruity of the petition with the evidence adduced at trial, the cooperative cross-moved to amend the pleadings to conform to the proof.

Evidence at trial showed that respondent Jeanette Marks had been a member of the Tenants' Association prior to the conversion of the subject building to a cooperative and was then [*3]a member of the board of the cooperative for a short period of time. Moreover, the cooperative proved that part of its prima facie case concerning the rate of monthly maintenance by calling one of the respondents as its own witness. Thus, the Court cannot discern any prejudice that would accrue to Respondents upon an amendment of the petition. In particular, Respondents have not alleged that an amendment of the petition as the cooperative requests would have hindered the preparation of Respondents' case or prevented them from taking some measure in support of their position, the measure of how "prejudice" is defined in the context of an amendment to a pleading. Whalen v. Kawaski Motors Corp., U.S.A., 92 NY2d 288, 293 (1998), Loomis v. Civetta Corinno Constr. Corp., 54 NY2d 18, 23 (1981), Anoun v. City of New York, 85 AD3d 694 (1st Dept. 2011), Valdes v. Marbrose Realty Inc., 289 AD2d 28, 29 (1st Dept. 2001). Without a showing of prejudice as such, the petition's misstatement as to the nature of respondent Jeanette marks' proprietary lease is amendable at the conclusion of the cooperative's prima facie case. See Jordan v. McCauley, 178 Misc 2d 216 (App. Term 1st Dept. 1998), AGLI Realty Co. v. Sanchez, 2006 NY Misc. LEXIS 3257 (Civ. Ct. NY Co. 2006).

Respondents also moved to dismiss because the name of the cooperative on the petition differs from the name of the cooperative on a filing with the New York State Department of State ("DOS"). Respondents did not seek to admit this evidence at trial. Rather, Respondents moved for this relief during the pendency of the trial by written motion. The transfer of the proceeding to the trial part, as occurred in this matter, compels the conclusion that motion practice of this kind had been complete and the proceeding was already in a trial-ready posture at the time Respondents made their motion.

Even assuming arguendo that the Court was to consider the document Respondents interpose on their motion, Respondents do not state a ground to dismiss the proceeding, especially in light of the cooperative's cross-motion to amend the pleadings to conform to the proof taken at trial. The caption and the petition in this matter state the cooperative's name as "170 West 85th Street Housing Development Fund Corp." The document attached to Respondents' motion from the DOS website identifies the cooperative as "170 West 85 Street Housing Development Fund Corporation." Respondents take the position that the use of the ordinal "85th" instead of the cardinal "85" together with the use of the abbreviation "Corp." instead of "Corporation" amounts to a defect. Such minute differences do not amount to a fatal defect in the pleading. See Empire State Bldg. Co., LLC v. Progressive Catering Servs., Inc., 2 Misc 3d 545, 546 (Civ. Ct. NY Co. 2003) (when a signatory to a predicate notice signed off as an officer of "Empire State Building LLC," although no such entity existed and the correct name of the entity should have been "Empire State Building Company LLC," the Court found that such a defect would not cause the respondent therein difficulties understanding which entity bringing the proceeding). Accordingly, the Court grants the cooperative's motion to amend the pleadings so that they conform to the proof adduced at trial and denies Respondents' motion to dismiss, and further the Court finds that the cooperative proved its prima facie case at trial, shifting the burden to Respondents to prove their defenses.

Respondents' answer raises the statute of limitations as a defense. A cause of action for nonpayment of rent sounds in contract. Solow v Wellner, 86 NY2d 582, 589-90 (1995), Fasal v. La Villa, 2 Misc 3d 137A (App. Term 1st Dept. 2004), Fucile v. LCR Dev., Ltd., 2011 NY Slip Op. 32256U (Dist. Ct. Nassau Co.). The statute of limitations on causes of action sounding in [*4]contract is six years. CPLR §213(2). The cooperative's claim for maintenance arrears is governed by a six-year statute of limitations that runs on each payment from the date it becomes due. Arnav Indus., Inc. v. Pitari, 82 AD3d 557, 558 (1st Dept. 2011). The Court file shows that the petition in this matter was filed on March 16, 2012. Six years prior to March 16, 2012 was March 16, 2006. The proprietary lease in evidence provides that the maintenance is due on the first day of every month. Accordingly, the cooperative's cause of action for rent due on or before March 1, 2006 had already accrued more than six years prior to the commencement of this proceeding. The Court dismisses so much of the petition as seeks a judgment for maintenance accruing on or before March 1, 2006 as barred by the statute of limitations.

Separate from a statute of limitations defense, Respondents' answer also raises a defense asserting that the cooperative unduly and unjustifiably delayed commencing this petition, causing Respondents to change their position in good faith reliance on the cooperative's failure to take any action or make claims against Respondents.

Ordinarily, the assertion of delay-related defenses in nonpayment proceedings is in the form of laches. In order to establish laches, a party must show: (1) conduct by an offending party giving rise to the situation complained of; (2) delay by the complainant in asserting his or her claim for relief despite the opportunity to do so; (3) lack of knowledge or notice on the part of the offending party that the complainant would assert his or her claim for relief; and (4) injury or prejudice to the offending party in the event that relief is accorded the complainant. All four elements are necessary for the proper invocation of the doctrine. Meding v Receptopharm, Inc., 84 AD3d 896, 897 (2nd Dept. 2011), Dwyer v. Mazzola, 171 AD2d 726 (2nd Dept. 1991), A & E Tiebout Realty v. Johnson, 23 Misc 3d 1112A (Civ. Ct. Bronx Co. 2009), affirmed, 26 Misc 3d 131A (App. Term 1st Dept. 2010). While Respondents' answer omits the word "prejudice," the Court can infer an allegation of prejudice from the language of the answer. However, Respondents did not introduce any evidence of prejudice at trial. Without such a showing, Respondents do not meet their burden of proving a laches defense. Philippine Am. Lace Corp. v. 236 W. 40th St. Corp., 32 AD3d 782, 784 (1st Dept. 2006).

The use of the word "reliance" in Respondents' answer and the reference to an alleged change of position of Respondents indicates that they are raising an equitable estoppel defense. See, e.g., BWA Corp. v. Alltrans Express U.S.A. Inc., 112 AD2d 850, 853 (1st Dept. 1985). However, neither the answer nor the evidence show how, in any way, Respondents changed their position as a result of the cooperative's delay in commencing a nonpayment proceeding. To the extent that Respondents' answer raises an estoppel defense, Respondents have not met their burden of proving it.

Respondents also raise a defense of tender and refusal. The only evidence at trial that Respondents made a tender to the cooperative was co-respondent Thomas Marks' testimony that one time, approximately ten years ago, he tendered $243.00, which was returned to him. This sole tender of one month's maintenance, made more than six years prior to the commencement of this proceeding, is insufficient to show that the cooperative wrongfully manipulated Respondents with Respondents' ultimate inability to satisfy a judgment and consequent eviction in mind. 428 E. 66th St., LLC v. Meirowitz, 12 Misc 3d 141(A) (App. Term 1st Dept.), leave to appeal denied, 2006 NY App. Div. LEXIS 15940 (1st Dept. 2006).

Moreover, the Court notes that the nature of the defenses of laches, estoppel, and [*5]wrongful refusal of properly-tendered rent are equitable in nature. See Continental Cas. Co. v. Employers Ins. Co. of Wausau, 60 AD3d 128, 137 (1st Dept. 2008), leave to appeal denied, 13 NY3d 710 (2009). In order to obtain equity Respondents must do equity. Brown v. Cleveland Trust Co., 203 A.D. 435, 440 (1st Dept. 1922). Respondents have not conducted themselves in an equitable manner in the history of their occupancy of the subject premises. Paragraph 5.03(b)(i) of the proprietary lease in evidence requires the shareholder, i.e., respondent Jeanette Marks, to use the subject premises as her primary residence. This is consistent with an important objective of Article XI of the Private Housing Finance Law, which establishes HDFC's in order to provide housing to low income families. 546 W. 156th St. HDFC v. Smalls, 43 AD3d 7, 13 (1st Dept. 2007). A failure to maintain such housing as a primary residence undermines that objective and denies affordable housing to another eligible household. The length of Respondent Jeanette Marks' non-residence at the subject premises bespeaks a particularly brazen disregard for this objective. The occupancy of the subject premises by co-respondent Thomas Marks, Jeanette Marks' son, does not mitigate this iniquity. No evidence was introduced at trial that any attempt was made to transfer the shares to the subject premises to co-respondent Thomas Marks. A shareholder of an HDFC is in breach of her proprietary lease for failing to maintain her apartment as her primary residence even if she leaves family behind if she does not follow the procedure outlined in the proprietary lease to assign her shares as such. 167-169 Allen St. HDFC v. Ebanks, 22 AD3d 374 (1st Dept. 2005), leave to appeal denied, 2006 NY App. Div. LEXIS 1892 (1st Dept. 2006). The Court finds that Respondents have therefore not met their burden of proving entitlement to relief on their equitable affirmative defenses.

Respondent Jeanette Marks' failure to reside in the subject premises also operates to deprive her of a remedy pursuant to a breach of the warranty of habitability. Genson v. Sixty Sutton Corp., 74 AD3d 560 (1st Dept. 2010). As the warranty of habitability sounds in breach of contract, and as co-respondent Thomas Marks is not a party to any contract with the cooperative, co-respondent Thomas Marks does not have standing to seek an abatement predicated on the breach of the warranty of habitability. Bandler v. Battery Park Mgt. Co., 10 Misc 3d 133A (App. Term 1st Dept. 2005).

Respondents having failed to prove their defenses at trial except for the statute of limitations, the cooperative is entitled to a money judgment against Respondent Jeanette Marks for $20,655.00, maintenance arrears from April 2006 through April 2013, a total of eighty-five months at a monthly rate of $243.00. In addition to that, the cooperative is entitled to a final judgment of possession against Respondents, as the occupancy of co-respondent Thomas Marks

is derivative of Respondent Jeanette Marks, as the shareholder in this proceeding. Issuance of the warrant is stayed through June 15, 2013 for payment of $20,655.00.

The parties are directed to pick up their exhibits within 30 days or they will either be sent to the parties or destroyed at the Court's discretion and in compliance with DRP-185.

This constitutes the decision and order of this Court.

Dated:New York, New York

June 10, 2013 [*6]

________________________________

HON. JACK STOLLER

J.H.C. Footnotes

Footnote 1: The cooperative interposed the reply by counsel. Subsequent to the reply, new counsel substituted in for the cooperative.

Footnote 2: The cooperative called respondent Thomas Marks as its own witness on its prima facie case. It has long been recognized that a party in a civil suit may be called as a witness by his or her adversary and, as a general proposition, questioned as to matters relevant to the issues in dispute. McDermott v. Manhattan Eye, Ear & Throat Hospital, 15 NY2d 20, 26 (1964).