Scott E. Mollen
Scott E. Mollen ()

Co-ops – Proprietary Lease Did Not, as a Matter of Law, Require That Shareholder Reside Contemporaneously With Member of Immediate Family—Second Department Held That the Lease Provision Was Ambiguous and Did Not Expressly Require the Consent for the Subject Type of Occupancy Arrangement—First Department Reviewing the Same Provision, Found a Contemporaneous Occupancy Requirement

A cooperative corporation (co-op) commenced a holdover proceeding to recover possession of an apartment, maintenance arrears, legal fees, costs and disbursements. The salient issue was whether the respondent shareholder violated the subject proprietary lease by “unlawfully subletting the apartment to her daughter.” The co-op alleged that the shareholder did not reside in the apartment and that the lease “requires her to occupy the premises contemporaneously with her daughter.”

The respondents contended that “the plain language of the…lease allows for immediate family members to reside with a named lessee.” The respondents had moved to dismiss the petition pursuant to CPLR 3211(a)(7), upon documentary evidence, or in the alternative, for dismissal pursuant to CPLR 3211(a)(7) and RPAPL §741, upon the grounds that the petition fails to state a cause of action.

The shareholder asserted that she “never illegally sublet her apartment to her daughter.” Rather, “her daughter resides with her and on occasion, her daughter’s boyfriend ‘stays at the apartment.’” The daughter claimed that she lived with her mother for the past 12 years. The daughter stated that

“the landlord has known I have resided in the apartment with my mother.… I have paid, and the landlord has accepted, payments in my name for my mother’s maintenance dues for years”.… She further claims that there is no “sublease” agreement with her mother and that she does not pay rent.

The court found that the petition stated a cause of action for a summary holdover proceeding and denied dismissal on that basis. The court also denied dismissal on the grounds of “documentary evidence,” because the affidavits of the shareholder and her daughter did “not constitute documentary evidence within the meaning of CPLR 3211(a)(7).” The respondents had also relied upon the language of the lease, arguing that “the plain language…therein clearly allows [shareholder] to reside in the apartment with her immediate family members and that as such her daughter,…, cannot be evicted as a sub-tenant.” Thus, the court had to interpret “Paragraph 14 of the…lease,” “entitled ‘use of premises,’” and “Paragraph 15, entitled ‘subletting.’” Paragraph 14 provided in pertinent part:

The lessee shall not, without the written consent of the lessor on such conditions as lessor may prescribe, occupy or use the apartment or permit the same or any part hereof to be occupied or used for any purpose other than as a private dwelling for the lessee and lessee’s spouse, their children, grandchildren, parents, grand-parents, brother and sisters and domestic employees, and in no event shall more than one married couple occupy the apartment without the written consent of the lessor. In addition…, the apartment may be occupied from time to time by guests of the lessee for a period of time not exceeding one month, unless a longer period is approved in writing by the lessor, but no guests may occupy the apartment unless one or more of the permitted adult residents are then in occupancy or unless consented to in writing by the lessor.

Paragraph 15 of the lease, with certain exceptions, provided that the shareholder may “not sublet the whole or any part of the apartment” without the consent of the co-op.

The court reviewed certain rules of contract construction, i.e., courts should avoid interpretations “that would render a provision ineffective…, the words must be accorded their fair and reasonable meaning” and language must be construed “so that there is a reasonable determination of the parties’ expectations….” Additionally, all contracts embody an implied “covenant of good faith and fair dealing,” and courts will not invalidate a contract “merely because, in hindsight, a party decides that the terms of the contract were improvident….”

The court acknowledged that two decisions, one from the Appellate Division, First Department and one from the Appellate Term, First Department, interpreted “identical provisions to the one at issue here” and found “a contemporaneous occupancy requirement.” One such decision held that:

Paragraph 14…provides that the apartment may not be used for any purpose “other than as a private dwelling for the lessee and lessee’s wife, their children, grandchildren, parents, grandparents, brothers and sisters and domestic employees.” The motion court correctly construed this as permitting occupancy by the listed persons other than the lessee only if the lessee maintains a concurrent occupancy. This meaning is manifested by a grammatical structure that does not differentiate between the lessee’s family and domestic employees. Thus, to hold that Paragraph 14 permits defendant’s mother-in-law to live in the apartment without defendant also living there at the same time would be to permit defendant’s domestic employee to live in the apartment without defendant also living there at the same time—a patently unintended if not absurd result….

A different result was reached by a Civil Court in Queens County (Civil Court). That court held:

The sole basis of petitioner’s interpretation is an appeal to the grammatical structure of the clause; it says, “The lessee and…,” not, “The lessee or….” According to petitioner, this implies that the lessee must reside in the apartment together with the permitted occupants. In terms of grammar, “and” is merely a coordinating conjunction (as is the word ‘or’). Alone it does not clearly impart any correlative meaning to the elements it joins and therefore does not inexorably mandate the reading that petitioner advances. …, the existence of a restrictive use of demised premises should not spring from an implication drawn from an attenuated grammatical analysis of a single conjunction. Restrictive use clauses in a lease, though legal and enforceable, are looked upon strictly by the courts, and an intention to restrict the manner of occupancy or use of the demised premises must be clearly and unequivocally expressed in the lease.… In the absence of a clear provision in the lease, a restriction in the use of the premises will not be implied….

The court further noted that “[a]ny ambiguity is to be strictly construed against the landlord who drafted the restrictive use clause and resolved in favor of the tenant….” The Civil Court case emphasized that “[n]owhere, is it specifically stated in Paragraph 14…that petitioner must occupy the subject apartment contemporaneously with the permitted residents, except that no guests may occupy the apartment unless one or more of the permitted adult residents are then in occupancy.” Given the absence of a lease provision or statutory requirement, the Civil Court held that “it may not be inferred that the parties’ intention was to mandate the residency of Respondent.”

The court further reasoned that “[i]n the absence of any relevant lease provision or any statutory requirement, it may not be inferred that the parties’ intention was to mandate the residency of Respondent.” The Civil Court then opined “the language of Paragraph 14 clearly implies that the residency of the lessee’s brother was not intended by the parties to be dependent on the lessee’s maintenance of the apartment as his primary residence.”

It further noted that, “under certain circumstances, a restriction on use and occupancy can be waived by a cooperative corporation.”

The subject court then cited Wilson v. Valley Park Estates Owners, 301 AD2d 589 (2d Dept 2003), wherein the Appellate Division, Second Department found that the subject lease provision was “ambiguous.” The Second Department held:

There are triable issues of fact as to whether the plaintiff…, breached his propriety lease by allowing his daughter and her fiancé to reside in the unit he purchased, while he resided elsewhere. The defendants claim that the propriety lease required that the subject unit be occupied by the shareholder and his family, and that according to the cooperative’s policy, use of the unit was considered a sublet unless the shareholder was in residence. Such a sublet required consent of the cooperative’s board of directors, which allegedly was not obtained. However, the relevant provision of the proprietary lease is ambiguous and does not expressly require that consent be obtained for the type of arrangement at issue in this case. Accordingly, judgment as a matter of law should not have been granted in the defendants’ favor on the basis of this alleged breach.

The court concluded that based on “the controlling Second Department authority, the [shareholders'] motion for a dismissal upon documentary evidence, i.e., the proprietary lease, must be denied.”

221 Middle Neck Owners Corp. v. Paris, LT-000845-17, NYLJ 1202789583496, at *1 (Dist., NA, Decided June 1, 2017), Fairgrieve, J.


Landlord-Tenant – Rent Stabilization – Court Has Authority to Restore Tenant to Possession Even After Execution of the Warrant of Eviction

This case involved a nonpayment summary eviction proceeding. The landlord had evicted the tenant after she had defaulted in paying rent arrears that was owed pursuant to a prior settlement agreement (settlement). The tenant thereafter moved to be restored to possession of the apartment. The tenant was “deaf” and had lived in the apartment for more than 20 years. “Her tenancy was rent-stabilized and subsidized by a federal Section 8 Housing Choice Voucher subsidy.”

The parties’ settlement provided that the landlord was “awarded a judgment of possession and issuance of the warrant forthwith. Execution of the warrant was stayed on the condition that [tenant] pay…rent arrears by April 10, as well as April rent.”

Although the tenant paid the April rent and the May rent, she had not paid the rent arrears by April 10 or at any time prior to being evicted on May 12. On May 13, the day following the eviction, the Department of Social Services (DSS) issued a check to the tenant. Although the amount of the check was less than the arrears, it was a “few dollars more than the rent that [landlord] alleges is due as of the date of its May 23 opposition papers.” The warrant of eviction was issued on April 12.

A week earlier, the tenant had gone to the courthouse and attempted to seek a stay of eviction on the grounds that the “DSS had not yet paid her rent arrears. There were no sign language interpretation services available on that day. Even though [tenant] could communicate using pen and paper, she somehow left the courthouse confused and frustrated, without having been provided with and given the opportunity to fill out and file the pro se motion form requesting a stay.”

The tenant thereafter followed up with DSS and “received what she believed were assurances that her application for rent arrears assistance was being processed and would be approved.” The tenant thereafter returned to the courthouse and attempted to move for a stay of eviction. However, no interpreter was then available and she was unable to move for a stay. The tenant was “instructed to return to the courthouse with a friend or family member so that she could move for a stay.” The tenant failed to do so.

The tenant was evicted on May 12. The landlord had hired an architect and an expeditor to file and obtain a permit for a gut renovation of the apartment. However, no work had been commenced and the landlord had not made any payments for those services.

A recent Appellate Division, First Department decision held that “[t]he Civil Court may, in appropriate circumstances, vacate the warrant of eviction and restore the tenant to possession even after the warrant has been executed.” In considering motions to restore to possession after execution of the warrant of eviction, courts are to consider “the length of the tenancy, the tenant’s disability, and the tenant’s ‘appreciable payments towards his rental arrears and…good faith efforts to secure emergency rental assistance to cover the arrears’….” The Appellate Term for the Second, Eleventh & Thirteenth Districts reached a similar conclusion.

Based on the subject circumstances, the court exercised its discretion to grant the tenant’s motion. The court directed that upon payment of the arrears, including legal and marshal fees, the tenant should be restored to possession and the warrant of eviction vacated. The court stayed re-letting of the apartment through that date.

Lana v. Monroe, 56138/2017, NYLJ 1202790760049, at *1 (Civ., KI, Decided June 6, 2017), Weisberg, J.