2264 G LLC v Issac Deli & Grocery Corp.
Annotate this CaseDecided on February 13, 2018
Civil Court of the City of New York, Bronx County
2264 G LLC AS SUCCESSOR IN INTEREST TO GRAND AVE. REALTY ASSOC., LLC, Petitioner-Landlord,
against
Issac Deli & Grocery Corp., Respondent-Tenant, WAIL M. ALSHABBI, Respondent-Undertenant.
L & T 901376/2016
HEIBERGER & ASSOCIATES PC
Attorneys for Petitioner
By: LAWRENCE C MCCOURT, ESQ
589 Eighth Avenue, 10th Floor
New York, New York 10018
212.532.0366
BART MAYOL, ESQ.
Attorney for Respondents
930 Grand Concourse, Suite 1-B
Bronx, New York 10451
Sabrina B. Kraus, J.
BACKGROUND
This summary holdover proceeding was commenced by 2264 G LLC (Petitioner) against ISSAC DELI & GROCERY CORP(Respondent) seeking to recover possession of 2264 Grand Avenue, Store #1, Bronx, New York 10453 (Subject Premises) based on the allegation that Respondent was a month to month tenant, who's tenancy had been terminated by a [*2]thirty day notice. Two other parties have appeared in this proceeding, ABDO ALI FARA(Fara) and WAIL M. ALSHABBI(WMA). WMA is the CEO of the Respondent corporation, and Fara asserts he is a co-owner of Respondent's business. All three respondents are represented by the same attorney.
PROCEDURAL HISTORY
Petitioner issued a thirty day notice of termination, dated July 25, 2016, terminating Respondent's tenancy as of August 31, 2016. The petition was filed on September 12, 2016, and it was served by delivery to a person of suitable age and discretion employed at the Subject Premises on September 17, 2016 at 11:36 am. Less than 48 hours later, a notice of appearance was filed by counsel for "respondent" on September 19, 2016. The notice did not identify which respondent the appearance was on behalf of. The notice was dated September 1, 2016, and was mailed to Petitioner's counsel on September 12, 2016, the same day the process server alleges delivery of the petition.
Proof of service of the Petition and Notice of Petition was filed on September 22, 2016, and the proceeding was initially returnable on September 29, 2016. On that date, counsel for the parties entered into a stipulation adjourning the proceeding to October 18, 2016 for "settlement" purposes and agreed that use and occupancy in the amount of $3,100.00 would be paid by October 5, 2016.
On October 18, 2016, the parties entered into a further stipulation setting a trial date for November 15, 2016 at 9:30 am. The stipulation made no reference to a request for a traverse hearing.
On November 4, 2016, Fara, appeared by counsel, who filed a notice of appearance and verified answer, specifically on his behalf. The answer stated that Fara was the named Respondent Tenant and that Petitioner had failed to correctly name him. The answer further stated "... Fara admits it is the respondent but denies Wail M. Alshabbi is the tenant of the premises." The answer asserted two affirmative defenses. The first affirmative defense alleges that Petitioner had failed to properly serve the notice of termination, because the individual served was not authorized to accept service on behalf of Fara. The second affirmative defense alleges that service of the notice of petition and petition was improper because Fara was not named. Fara also asserted a counterclaim for $5000 in attorneys' fees.
On December 12, 2016, Petitioner moved for an order substituting Fara in place of "John Doe" as a Respondent, striking Respondent's answer, and awarding Petitioner summary judgment. Fara submitted a short affidavit in opposition asserting that he was the owner of Respondent, and that the business was named Abdo Ali Fara Grocery. Fara stated that WMA was not properly named in the caption, because Fara was in sole possession and paid the rent since 2000.
The Court denied the motion without prejudice, on April 3, 2017, based on Petitioner's failure to annex pleadings, but allowed Petitioner to amend its claim for use and occupancy to date.[FN1] The court further held:
... Fara identifies himself as the Respondent and states that he should have been named in [*3]place of Wail M. Ashabbi. He does not declare any relationship to the Respondent herein, but appears to intervene on behalf of himself and a DBA Adbo Aki Fara Grocery. Intervening on behalf of himself and the DBA grocery store, Fara's allegation that he is the tenant in possession, gives him limited standing as a sub-tenant to challenge ejectment, but it does not give him standing to challenge any leases entered into with Respondent herein (emphasis added).On June 27, 2017, Petitioner's motion to restore the proceeding to the calendar was granted on consent, pursuant to a stipulation executed by counsel for Petitioner and "Respondent's counsel." The stipulation set a trial date for August 2, 2017, provided for the
payment for use and occupancy by July 11, 2017, and amended the petition to include all use and occupancy through June 2017.[FN2]
On August 2, 2017, the trial was adjourned to August 16, 2017, by the court (Wilson, J) pursuant to a notation on the file that stated "Trial Judge to determine whether a traverse is appropriate."
On August 16, 2017, the parties appeared before the court( Montano, J) for trial. The parties stipulated on the record that there was a prior decision from the court substituting Fara as a respondent in place of "John Doe" and that there was no remaining allegation as to "Jane Doe" or "XYZ Corp.".[FN3] The Court heard argument on the issue of whether a traverse hearing was necessary. The court decided to proceed with the hearing, prior to making any determination as to whether a hearing was necessary. The hearing commenced on August 16, 2017, and continued and concluded on August 23, 2016. The court heard testimony from two process servers.[FN4] Fara and WMA also testified. Fara acknowledged in his testimony that he had received delivery of papers pertaining to the proceeding at the Subject Premises, and that he gave the document to his attorney because he was not able to understand what it said.[FN5] At the close of the hearing, Petitioner requested that the court proceed with a trial forthwith. The Court reserved decision.
On October 5, 2017, the Court issued a decision. The court ordered Fara substituted as a [*4]Respondent in the proceeding, in place of "John Doe". The court provided in pertinent part:
First, this Court notes that at the beginning of the traverse hearing, a question arose as to whether Mr. Fara was a named respondent to the instant action. Petitioner's attorney indicated to this Court that "[t]here's a decision of the Court that makes [Mr. Fara] a respondent with relation to John Doe ... John Doe was replaced with Mr. Fara." When this Court asked Mr. Fara's attorney whether the statement made by petitioner's attorney was correct, he indicated "yes, your Honor." Nonetheless, after conducting a review of this Court's file, the Court's file is devoid of any Orders to the effect of replacing John Doe with Mr. Fara..... In any event, upon Mr. Fara's own admission in his Answer and during oral argument on August 16, 2017, that he is indeed in possession of the subject premises, which petitioner also seems to acknowledge as evidenced when he moved this Court for an Order amending the caption, this Court hereby deems Mr. Fara as a proper party to this action and hereby replaces "John Doe" with Mr. Fara. Accordingly, hereinafter this Court will reference Mr. Fara as "respondent Fara".The Court further held that Fara had asserted a traverse defense in his answer and that Fara's attorney had not waived this by stipulating to set the matter down for a trial. The court dismissed the proceeding without prejudice as against Fara holding: .... this Court finds that service of process herein was improper. It is undisputed that petitioner served the Notice of Termination, Notice of Petition and Petition to "Issac Deli & Grocery Corp c/o Wail M. Alshabbi, XYZ Corp, John Doe and Jane Doe." Although CPLR §1024 permits the use of a fictitious name (to wit: John Doe) to commence an action, same is only proper "where the adversary is ignorant of the name and identity of proper parties ... Thus ... utilizing "John Doe" was improper as petitioner had knowledge of the undertenant's identity and name (to wit: respondent Fara) prior to the commencement of this action. Accordingly dismissal without prejudice is warranted as against respondent Fara.
The court neither awarded Petitioner a judgment of possession as against Respondent, nor set the matter down for any further trial date.
On November 16, 2017, Petitioner's motion for an order restoring the proceeding for trial was granted without opposition, and a trial date was set for January 3, 2018. Two further applications for adjournments were granted, and on February 7, 2018, all parties appeared for trial, including Respondent Fara and WAM. The court held a bench trial and reserved decision.
FINDINGS OF FACT
Petitioner is the owner of the subject building, pursuant to a deed dated April 6, 2016 (Ex 1). Respondent is the tenant of record of the Subject Premises, pursuant to a lease dated April 24, 2012, between Respondent and Petitioner's predecessor in interest. The lease was for a term through and including June 30, 2016 (Ex 3A). WAM is the CEO of Respondent (Ex 5). Respondent became the tenant of record at the request of Fara, who was the principal of the prior tenant of record of the Subject Premises, Abdo Ali Fara Grocery. On April 23, 2012, Fara sent Petitioner a written request to a new lease issued for the Subject Premises in the name of Respondent by WMA (Ex 3B).
Fara and WAM are half brothers. Fara and WAM testified at trial that the change was necessary because WAM was able to obtain a liquor license and Fara was not. WAM testified [*5]that Fara is a co-owner of the business with him, and that he and his brother have run a business at the Subject Premises since 1991. No documentation was submitted to show that Fara has any official ownership in the business, but this seems to be the understanding as between Fara and WAM.
USE & OCCUAPNCY
Petitioner seeks a money judgment against Respondent for $55,424.02 for use and occupancy through June 2017, based on the tenant ledger submitted at trial (Ex 4). Petitioner testified the last month that rent was paid prior to the termination was July 2016. However, the ledger has an opening balance of over $11,180.11 that is unaccounted for and the amount sought improperly includes charges for legal fees totaling $950.00.[FN6]
The court finds Petitioner has established a right to a money judgment against Respondent in the amount of $43,293.93 through February 2018.
DISCUSSION
Petitioner clearly established a prima facie case for possession as against Respondent. It is undisputed that Respondent's lease expired on June 30, 2016. Respondent remained on as a month to month tenant, and its right to occupancy was terminated by service of a thirty day notice. Respondent appeared herein by counsel, but served no answer, so a general denial is deemed asserted on Respondent's behalf. Respondent presented no viable defense at trial either to Petitioner's claim for possession or to Petitioner's claim for use and occupancy.
The real issue is as Fara. Fara was not named and served in this proceeding, but voluntarily appeared and sought to defend in this proceeding as an intervener pursuant to RPAPL § 743.
In trying to ascertain the law of the case as to Fara in this proceeding, the actions of the parties, and the pre-trial orders are somewhat confusing. The April 2017 decision confirms that Fara had voluntarily appeared in this proceeding, without being named and served, as an intervener. Counsel appear to have stipulated to substitute Fara for " John Doe", based on motion papers, the June 27, 2017 stipulation, and the statements made on the record during the traverse hearing. After the traverse hearing the court, sua sponte substituted Fara for "John Doe", but then dismissed as to Fara, holding Petitioner was not entitled to have named and served Fara as "John Doe". Yet even after dismissal, Fara appeared and defended at trial.
Notwithstanding the prior history, and Fara's subsequent appearance at trial, this Court feels constrained to hold that the prior dismissal as against Fara remains the law of the case.
Fara, is at most a subtenant in occupancy through Respondent. In fact the testimony of WAM and Fara really relegate him more to an employee of Respondent, based on his informal understanding with WAM. Whether Fara is subtenant, employee, occupant or licencee, Fara is not a necessary party to a proceeding (Teachers College v Wolterding 77 Misc 2d 81).
Nor was Petitioner required to have served Fara with the thirty day notice of termination, as Fara has no independent right to possession.
Absent a surrender of possession by the tenant (see, Matter of Eight Cooper Equities v Abrams, 143 Misc 2d 52, 54-55 [surrender is accomplished by vacating the premises and [*6]returning the keys to landlord]), which is not established by the record before us, the lessor must obtain a judgment of possession against the lessee pursuant to RPAPL 711 and may not proceed directly against the undertenant, whether licensee, subtenant or occupant, pursuant to RPAPL 713 (100 W. 72nd St. Assocs. v Murphy, 144 Misc 2d 1036, 1039). Therefore, the 10-day notice provision of RPAPL 713 is inapposite, and the 30-day notice provision of Real Property Law § 232-a is applicable only to respondent Cruz as the immediate tenant of the lessor.The rights of a person whose claim to possession derives from the lessee are subordinate and are extinguished by a judgment of possession in favor of the lessor. Due process requires only that, for the warrant to be effective against a subtenant, licensee or occupant, he be made a party to the proceeding, either by naming him in and serving him with the petition and notice of petition or by joining him as a party during the pendency of the proceeding (CPLR 401; CCA 110 [d]). Mosquera was served with a copy of the petition and notice of petition, naming him as "Freddy Doe (Undertenant)", which was legally sufficient to give him notice of the proceeding.[170 W. 85th St. Tenants Ass'n v. Cruz, 173 AD2d 338, 339—40; see also 539 W 156, L.L.C. v. Jose Hernandez, 55 Misc 3d 144(A)).
Notwithstanding said dismissal, Petitioner, if so advised, still has the right to move for a judgment against Fara. As held by the Appellate Term, in a case directly on point:
In this commercial holdover proceeding, Civil Court granted summary judgment dismissing the petition on the ground that subtenants whose names and identities were known to landlord prior to its commencement were improperly designated as "John Doe" and "Jane Doe", and that the subtenants were necessary parties without whom complete relief could not be accorded. We agree that CPLR 1024 permits use of a fictitious name only where the adversary is ignorant of the name and identity of proper parties, and that dismissal is warranted against such parties—in this case subtenants—where, as here, their names and identities were concededly known to landlord prior to commencement of the underlying holdover proceeding. Such dismissal is not fatal to the proceeding as it relates to the tenants, however. The subtenants, while "proper" parties to the instant holdover proceeding, are not "necessary" parties whose presence is indispensable to the according of complete relief as between landlord and tenant. Consequently, the petition should not have been dismissed against the tenants and is reinstated with leave to landlord to renew its motion for summary judgment of possession in Civil Court. Landlord, if so advised, may apply for joinder of the subtenants as additional named parties, so that any warrant obtained in this proceeding will be effective against them .[Triborough Bridge & Tunnel Auth. v. Wimpfheimer, 165 Misc 2d 584, 585—86 (App. Term 1995)(citations omitted)].
CONCLUSION
Based on the foregoing, the court finds that Petitioner is entitled to a final judgment of possession as against Issac Deli & Grocery Corp and Wail M. Alshabbi. The petition remains dismissed as against all other Respondents. The caption is deemed amended to reflect these changes. The warrant of eviction shall issue forthwith, and may execute upon Marshall's notice. Petitioner is also awarded a money judgment against Issac Deli & Grocery Corp, in the amount [*7]of $43,293.93.
This constitutes the decision and order of this court.
Dated: February 13, 2018
Bronx, New York
_________________________
Hon. Sabrina B. Kraus
JCC Footnotes
Footnote 1:The Court noted that only Fara had submitted opposition to Petitioner's motion.
Footnote 2:The motion papers, including Fara's opposition, and the stipulation contained a caption amended from the original caption of the petition in that it substituted Fara as a Respondent in place of John Doe, but this was not otherwise addressed in the body of the stipulation. Fara stated in his affidavit in opposition that he was appearing as a respondent and that he was in possession of the Subject Premises.
Footnote 3:No such decision is found in the court file. Judge Rivera's decision specifically denied such relief without prejudice, but found Fara had appeared as an Intervener in this proceeding. The transcript from the August 16, 2017 is in the court file.
Footnote 4:While labeled a traverse hearing, there was never any allegation by Petitioner that Fara had been named and served, and no denial by Fara that the process servers did what was alleged in their affidavit.
Footnote 5:Transcript from August 23, 2017, p. 28.
Footnote 6:At trial, Petitioner reserved its right to seek legal fees, until after the trial decision.
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