Karaduman v Grover

[*1] Karaduman v Grover 2019 NY Slip Op 50560(U) Decided on April 16, 2019 City Court Of Ithaca, Tompkins County Miller, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 April 16, 2019
City Court of Ithaca, Tompkins County

Arzu Karaduman, Plaintiff,

against

William P. Grover, Defendant.



SC47691-18
Scott A. Miller, J.

Plaintiff commenced this small claim on September 12, 2018, claiming $1,800.00 for return of a security deposit and first month's rent deposit for an apartment located at 411 Hillview Place in Ithaca, New York. At the hearing held on March 7, 2019, both Plaintiff and Defendant, William P. Grover, appeared and testified. Plaintiff's Exhibits 1-8 were marked and received into evidence as were Defendant's Exhibit A and B. This Court is required to 'determine the defendant's true name" (Uniform City Court Act Section 1814[c]). The Court had the Tompkins County Clerk search its business databases, and no entity known as Dell Management, LLC, is currently listed. The deed for the Hillview Place property indicates it is owned by William P. Grover, 242 Comfort Road, Ithaca, New York. Therefore, the true name of the Defendant in this matter is William P. Grover..

Arzu Karaduman testified that she responded to Mr. Grover's Craiglist advertisement for an apartment located at 411 Hillview Place, Apartment 1, in Ithaca, New York. Ms. Karaduman, a graduate student at the time, lived in Atlanta, and could not afford to view the apartment before moving in. She testified that Mr. Grover emailed her a PDF of the lease, which both she and Mr. Grover signed on July 19, 2018. The lease provides that the term began on August 1, 2018, and ends on July 28, 2019. The rent was $900.00 per month, and a $900.00 security deposit was required at signing. Ms. Karaduman sent Mr. Grover a check for $1,800.00 for security and the first month's rent. Mr. Grover agreed to a delayed deposit (September 30) of the last month's rent (Defendant's Exhibit A). The lease does not require that any modifications be in writing and signed by the parties (id).

Ms. Karaduman testified that when she visited the apartment for the first time to take possession on August 4, 2018, she was "shocked". She testified that the presence of peeling paint, "swelling" of plaster walls and other evidence of past water damage must have meant that the apartment had a current water problem. She found no mold or dampness but testified that the apartment smelled musty.

The Court has thoroughly review the photographs and videos Plaintiff submitted and finds as follows:

Kitchen - the kitchen is spacious and was fully equipped, the only defect being outdated metal cabinets with rust on the interior of metal drawers. The kitchen appears to be fully functional, and any rust on the cabinet drawer interiors can be simply covered with shelf or contact paper.

Living room - the living room wall has a mark where the couch was originally placed. There are no other defects affecting the habitability of the living room.

Bath - the bath is clean, but needs updating. There was a small amount of rust on the showerhead and vent, but nothing remarkable or even remotely affecting habitability.

Walls/ceiling - throughout the apartment the walls and ceilings show evidence of past damage, possibly flooding from above. There are cracks and repairs, but absolutely no evidence of current water damage or seepage. In general, this apartment is roomy, well laid out and a good value for Ithaca. It is not new, but is one of the better apartments in the area, in this Court's experience.

Condition of the Apartment

Ms. Karaduman notified Mr. Grover that she was not taking possession of the apartment, and rented another apartment. She told Mr. Grover to keep the furniture she had purchased from the previous tenant for $325.00 and $300.00 of her $1,800.00 deposit. Mr. Grover testified that he re-rented the apartment to Mariela Nunez Santos on September 15 for $900.00 per month (Defendant's Exhibit B). Ms. Santos described the apartment as follows:

"This Hillview apartment is very spacious. Aside from a big room there is an office that is big enough to be used as a second bedroom. The apartment has ample storage space and is conveniently located close to both Ithaca College and Cornell. The place was big enough for me to host dinner gatherings with friends. I think this apartment would be ideal for a person that has a car, however it is still walking distance to downtown. There is a nice backyard area that you can enjoy when the weather is nice. Best, Mariela"

(Defendant's Exhibit B).

New York has a residential warranty of habitability which guarantees that apartments are safe and habitable:

Pursuant to Real Property Law § 235—b, every residential lease contains an implied warranty of habitability which is limited by its terms to three covenants: (1) that the premises are fit for human habitation, (2) that the premises are fit for the uses reasonably intended by the parties, and (3) that the occupants will not be subjected to conditions that are dangerous, hazardous or detrimental to their life, health or safety. Despite the expansive language of the statute, the Court of Appeals has "specifically rejected the contention that the warranty was intended to make the landlord a guarantor of every amenity customarily rendered in the landlord-tenant relationship and held that the implied warranty protects only against conditions that materially affect the health and safety of tenants or deficiencies that in the eyes of a reasonable person ... deprive the tenant of those essential functions which a residence is expected to provide" (Solow v. Wellner, 86 NY2d 582, 588, 635 N.Y.S.2d 132, 658 N.E.2d 1005 [1995].The existence of a code violation does not automatically translate into a breach of the warranty of habitability; rather, "once a code violation has been shown, the [tenant] must come forward with evidence concerning the extensiveness of the breach, the manner on which it impacted upon the health, safety or welfare of the tenants" (211 E 46th Owners LLC v. Mohabir, 33 Misc 3d 1232(A), 2011 WL 6141671 [Civ.Ct.2011]. Pena v. [*2]Lockenwitz, 53 Misc 3d 428, 433 (NYC Civ. Ct. 2016)

Based on the testimony, photographs and videos, the Court found no conditions detrimental to either life, health, or safety. The apartment was immediately re-rented and the new tenant reviewed it quite favorably. Ms. Karaduman never took possession of the apartment and therefore could not determine if there were any functional hazards, such as lack of heat, hot water or ventilation. Ms. Karaduman claims that the apartment smelled musty, but there was no evidence of current dampness or water leakage (see Ferguson Bros. & Forshay v Ward, 147 N.Y.S. 868 (App. Term 1914). Based on the foregoing, the Court finds the landlord did not breach the residential warranty of habitability.

Accord and Satisfaction

The next issue is whether the parties reached an agreement with respect to Ms. Karaduman's lease. Because the landlord was able to re-rent the premises, his damages, at most, would be August rent ($900.00) and half of September ($450.00). The lease was signed by both parties on July 19, 2018 (Defendant's Exhibit A). The lease is a binding contract which creates mutual obligations by both the landlord and tenant (1 New York Landlord & Tenant Including Summary Proceeding Section 1:2 [5th Ed]). After signing the lease, the landlord delivered physical possession of the apartment to Ms. Karaduman, but she did not take possession. While Mr. Grover delivered physical possession, the apartment had lacked a certificate of compliance for 7 years, the result of which is set forth more fully later in this Decision.

The Court has reviewed the parties' emails and text messages to determine if there was an accord and satisfaction settling the rights of the parties to the lease. An accord and satisfaction has two components: (1) an accord is an agreement that a stipulated performance will be accepted in the future in lieu of an existing claim, and (2) satisfaction, which is an execution of the accord (19 NY Jur Compromise, Accord and Release § 1). An accord is considered a contract, not merely a revocable offer, between parties for the settlement of a claim (id.).

On August 4, when Ms. Karaduman came to move into the apartment, she notified Mr. Grover that she would not be taking possession due to the condition of the apartment. She did not take possession. She asked for a cancellation of the lease and the return of her $1,800.00, and in return, offered Mr. Grover the $325.00 in furniture she had purchased (Plaintiff's Exhibit 2, email dated August 4, 2018). On August 6, Ms. Karaduman emailed Mr. Grover again asking for "confirmation as you agreed that we cancel [the] contract and you pay me back $1,500.00 (I had initially paid you $1,800.00). I told you to keep the $300.00 from the $1,800.00 and the furniture I bought from Karla for $325.00". (id., email dated August 6, 2018). Between August 6 and August 24, the parties continued with texts.

During early August, the parties text messaged extensively (Plaintiff's Exhibit 3). In those texts, Ms. Karaduman made it known that she thought the apartment needed updating and that it had a water problem creating a health hazard. Mr. Grover agreed to do "everything that makes [you] comfortable and happy" (Plaintiff's Exhibit 3, text dated August 4, 2018). Ms. Karaduman demanded her deposit back to which Mr. Grover responded, "I don't understand- never had mold problem. "[Y]our first person to say. [W]e will one way other whatever you. I'm sorry you're not happy" (id., text dated August 4, 2018). Mr. Grover also texted, "Ok I agree I've never had anyone say anything like this I'm good and fair person. I don't want you unhappy we will do what you want to. [S]orry you don't like. [I]t's not like new complex rental" (id., text dated August 4, 2018). Ms. Karaduman then stated "Thank you for being understanding. I know you kept it for me until now. How about you keep $300 (1/3 month rent) and all the furniture [*3]and return the rest of $1800 I paid, which is $1500. You can rent it furnished to someone who needs furniture and I will try to find a place tomorrow. Venmo is fine." (id., text dated August 4, 2018).

On August 5, Mr. Grover responded "I will deal with all this Monday afternoon. [T]here is no health hazzard. [Y]ou are just not happy. [W]e will do what you ask but I. Dealing with till tomorrow sorry. No one has been sick. Karla is an educated person she would not have lived there. [T]ry to relax we will help you find something else. [I] totally don't understand but you can leave and we will settle up. [S]orry, Billy" (Plaintiff's Exhibit 3, text dated August 5, 2018). Ms. Karaduman then texted Mr. Grover that she was leaving town the next day, to which Mr. Grover responded, "I thought you said leaving Wednesday? Ok well I'm away, back tomorrow so just have to get you out and money so I will reach out to you tomorrow very sorry" (id., text dated August 5, 2018). Ms. Karaduman responded that she had made a Venmo request to Mr. Grover for $1,500 (id.). Mr. Grover responded that he was traveling and wouldn't be back until later in the day and that, "[W]e will figure it out" (id.).

Ms. Karaduman continued to demand payment of the Venmo request, and Mr. Grover responded later that evening: "Sorry I have to work through this situation. There is nothing wrong with that unit. You just don't like it. I have never had this happen in 20 years there since I've been running it for the family, so I don't want to say you're wrong. I don't want to say I'm right I'm just telling you when you're renting it doesn't work like the way you think it does. I've got to figure it all out and you know and now we are damaged because we may lose our seasonal rental window. [W]e have to rent it before can get approval from office. I called my brother who oversees all my parents' assests and that was what he said. So I would try to borrow the money till we work through this. I'm sorry but not going to go back and forth with you like this" (id.).

On August 24, Mr. Grover emailed Ms. Karaduman "as soon as its rented we will do a refund to you hopefully soon." (Plaintiff's Exhibit 2, email dated August 24, 2018). Ms. Karaduman immediately responded demanding the $1,500.00 so she could pay rent for her new apartment (id., email dated August 24, 2018). Mr. Grover responded, "[D]on't start threats. [W]e had a lease you broke it. [T]here's nothing wrong with that apartment! I understand your situation we will do the right thing" (id., email dated August 24, 2018).

Until August 5, Ms. Karaduman had no notice that other members of Mr. Grover's family were involved in making decisions regarding the property. The Court finds sufficient proof by a preponderance of the evidence that William Grover, the landlord, made an agreement with Ms. Karaduman to return $1,500.00 as set forth in the text messages above. Text messages are recognized by courts as having the import of letters and emails (People v. Limage, 19 Misc 3d 395[Kings Co Crim Ct, 2008]). At no time before making the accord did Mr. Grover inform Ms. Karaduman that he had to consult with his brother, and there is no proof, whatsoever, that Mr. Grover did not have full authority to both enter into the lease and reach an accord with Ms. Karaduman. While Mr. Grover may have had second thoughts about his promise to refund $1500.00 and keep $300 and the furniture, Ms. Karaduman has the right to rely on the accord the parties reached. Mr. Grover did not satisfy the accord reached by the parties. Thus, under an accord theory the Defendant would owe Plaintiff $1,500.00. However, as more fully set forth below, the Plaintiff had the right to cancel, or void, the lease and is entitled to a full refund.

Expired Certificate of Compliance

The Plaintiff testified that she reported the apartment to City Hall in September, and found that the landlord's 5-year certificate of compliance had expired in July 2011 (Plaintiff's [*4]Exhibit 1). The City agreed to look into code compliance and life safety, but it appears the City did not follow through, and it was not until December 2018, that Housing Inspector Jim Yarborough promised to follow-up (Plaintiff's Exhibit 4). Ms. Karaduman testified that the actual inspection was not set up until the day after this March 8 Small Claims Court hearing. More importantly, the City had contacted Mr. Grover in August of 2012 to schedule an inspection to renew the expired certificate of compliance. The expired certificate covered both zoning and housing code issues through July 2011. The response from Mr. Grover to the Building Department in October of 2012 specifically directed the City to take 411 Hillview off the rental property inspection schedule because he stated he was residing there for the foreseeable future. (Plaintiff's Exhibit 7) Several ordinances govern residential rental units in Ithaca, requiring current certificates of occupancy.

Ithaca City Code § 210-42 [A] provides:

§ 210-42 InspectionsAt least once every five years, all buildings containing rental dwelling units that are either a single-family unit or are two-family units shall be inspected by the Building Department for compliance with the New York State Uniform Fire Prevention and Building Code, City of Ithaca Municipal Code Chapter 210, Housing Standards, and all applicable housing standards.***

Ithaca City Code § 146-8[A] provides:

§146-8 Certificates of occupancy and certificates of completion.

Certificate of occupancy. A certificate of occupancy shall be required for all structures, buildings, or portions thereof, which are newly constructed or are converted from one use or occupancy classification or subclassification to another use or occupancy or subclassification. Permission to use or occupy a newly constructed or converted building or structure or portion thereof shall be granted only by the issuance of a certificate of occupancy.

The Code further provides that it is "unlawful for any person...to occupy any building...in violation of any provision of...[the] ordinance" Ithaca City Coder §146-50[A]. Illegal occupancy can render the owner guilty of an offense for every day of illegal occupancy, with penalties of up to $250.00 per day. ICC§146-50[B]. A Court may declare a lease void to prevent an illegal occupancy. ICC§146-51; Turmon v. Fantasia Auto, Inc., 147 Misc 2d 450[Nassau Co Dist Ct, 1990]; Harstin Constr. Corp v Millhauser, 136 Misc 646 [1st Dept, App Term, 1930]; cf. 56-70 58th St Holding Corp v Fedders-Quigan Corp, 5 NY2d 557 [1959], tenant who occupied premises with knowledge that alterations would need approval before a new certificate of occupancy would issue, and whose occupancy was undisturbed, was unjustified in vacating and asking the Court to void the lease).

New York State requires that all landlords provide tenants prior notice as to whether a certificate of occupancy, if required, is currently valid for an apartment. NY Real Property Law §235-bb. The statute provides:

1. Prior to executing a residential lease or rental agreement with a tenant, the owner of real property consisting of three or fewer rental units shall provide conspicuous notice in bold face type as to whether a certificate of occupancy, if such certificate is required by law, is currently valid for the dwelling unit subject to the lease or rental agreement. Owners who provide the tenant with an actual copy of the valid certificate of occupancy shall be deemed to have complied with the requirements of this subdivision.2. Any agreement by a lessee or tenant of premises for dwelling purposes waiving or modifying his or her rights as set forth in this section shall be void as contrary to public policy.

NY Real Prop. Law § 235-bb

Based on the 7-year expiration of the certificate of compliance, the Court finds compelling common law and statutory authority to void the lease due to illegal occupation. Ms. Karaduman was never informed the apartment lacked a certificate of occupancy. She never took possession of the premises, and made it very clear she wanted no issues with the apartment, legal or otherwise. She proved that there had not been a valid certificate of occupancy since 2011, and that Mr. Grover had stopped the apartment's reinspection in October 2012. Obtaining a valid certificate of occupancy prior to renting the apartment was solely Mr. Grover's responsibility. For all these reasons, the Court finds that the Plaintiff had the legal right to nullify the lease. Plaintiff is entitled to return of her full payment, $1800.00. Further, if Ms. Karaduman wishes to retrieve her furniture, she may make arrangements with Mr. Grover to do so.

JUDGMENT to Plaintiff, $1,800.00, plus costs.

This constitutes the Decision and Judgment of the Court entered upon notice to both parties. A notice of appeal, if applicable, must be filed within thirty (30) days of the date of this decision.

Dated: April, 2019

_________________________________

SCOTT A. MILLER

Ithaca City Court Judge