DECISION/ORDER This is a summary licensee holdover proceeding. Petitioner seeks to recover possession of Apartment 3R at 1115 40th Street, Brooklyn, New York 11218 (“premises”) on the ground that Respondent Cheryl Santos’ license to occupy the premises granted to her by Chesky Braun has been revoked. Respondent interposed a pro-se answer containing a general denial and affirmative defenses that Petitioner is not the rightful owner, that Respondent did not enter into any agreements with Petitioner, that there is fraud between Petitioner and Chesky Braun, and allegations of harassment. Petitioner subsequently obtained counsel but the pro-se answer was not amended. This court held a trial on August 29, 2022 and makes the following findings of fact and conclusions of law. Stipulated/Undisputed Facts: The following facts are not in dispute and were stipulated by the parties. Barbara Schwimmer owned the subject property pursuant to a registered deed, dated June 30, 1999. On April 19, 2005, Barbara Schwimmer executed a power of attorney giving Chesky Braun certain powers “specific to the heloc of the premises located at 1115 40th Street Brooklyn, N.Y. 11218 and obtaining financing in a 2nd lien position from Citi Mortgage Bank” to handle real estate transactions, banking transactions, and insurance transactions for the property. (R. Ex E). On February 7, 2012, Chesky Braun transferred the property to Capital Five LLC, and on June 18, 2012, Chesky Braun further transferred the property to 1115 40th Street Realty LLC (Pet. Ex. 3). Both transfers by Chesky Braun were challenged in Kings County Supreme Court, Index No. 512967/2015, entitled “Barbara Schwimmer and Capital Five LLC v. 1115 40th Street Realty LLC, Martin Brody and Chesky Braun.” By Decision/Order of the Honorable Leon Ruchelsman, dated October 3, 2018, the court found the February 7, 2012 and June 18, 2012 deeds to be null and void, and reinstated Barbara Schwimmer’s June 30, 1999 deed. The court concluded that Barbra Schwimmer was the sole owner of the property and that defendants had no ownership interest in the property. (Pet. Ex. 2). It is also undisputed that Cheryl Santos rented the premises pursuant to a lease agreement, dated January 14, 2013, between Chesky Braun and Cheryl Santos for a period of one year, from January 15, 2013 through January 31, 2014, and that Cheryl Santos paid monthly rent to Chesky Braun. (R. Ex. H). In 2018, Barbara Schwimmer deeded the property to Petitioner Barbara Schwimmer 40th Street LLC. Lastly, it is also undisputed that prior to commencing this licensee holdover proceeding, Barbara Schwimmer 40th Street LLC commenced a summary non-payment proceeding against Cheryl Santos on March 13, 2019, under L&T Index No. 59439/19, which sought $14,600.00 in rent for the premises. The non-payment proceeding was discontinued without prejudice on May 11, 2022 by Decision/Order of the Hon. Jack Stoller. Testimony: Barbara Schwimmer testified on her own behalf. Ms. Schwimmer credibly testified that she is the owner of the subject building, and that in 2005 she executed a power of attorney allowing her then son-in-law, Chesky Braun, to conduct transaction at the property and collect rents. Ms. Schwimmer testified that she allowed Mr. Braun to collect rents only for one year, and only because he was having financial difficulties and she wanted to help his family. Ms. Schwimmer let Mr. Braun collect rent and keep some of the rental proceeds for his expenses and the rest he was supposed to give to her. In 2012 she learned that Mr. Braun transferred the deed to the premises to himself. She only learned about the transfer because she received a notice from ACRIS that another deed was recorded for the property. She then told her husband, and after investigation, she found out that Chesky Braun transferred the property to himself without her permission. Immediately thereafter they tried to straighten it out in a family way, but when that did not work, she went to Rabbinical Court. The Rabbinical Court took over two years to decide the issue, and when the decision was rendered in her favor, Chesky Braun was supposed to transfer the property back to her. When Mr. Braun failed to abide by the Rabbinical Court decision, she hired an attorney who filed a Supreme Court action in 2015. That also took three years, and in 2018 she was finally able to get her building back when the deeds transferred by Mr. Braun were nullified. Petitioner credibly testified that between February 7, 2012 and October 3, 2018, she had no access to the building and did not know what Chesky Braun was doing. Furthermore, from February 7, 2012 through October 3, 2018, she did not participate in any lease negotiations, collect rent, or participate in day-to-day business affairs concerning the property. Ms. Schwimmer testified that she did not give Chesky Braun permission to transfer the building to himself, and she did not allow him to do any business at the building on her behalf during that time. As soon as she was able to regain ownership, she went to the building with her son and husband, introduced herself to Ms. Santos, tried to show her the deed to the premises and explain that she is the rightful owner of the property and all rental payments should go to her, but Ms. Santos told her “you are not my landlord,” did not want to speak to her, and closed the door. Petitioner testified that she never used a real estate agency to lease apartments, that up to 2018 she does not know how tenants learned about vacancies at the premises, that she has no personal knowledge who was living there prior to 2018, that between 2012-2018 she was denied access into the building and that she applied for and received LRAP for the subject premises. Next, Joel Schwimmer testified on behalf of Petitioner. Mr. Schwimmer testified that he is Petitioner’s son and presently he is a managing agent at the property. Since 2018, he has been present at the property monthly. Mr. Schwimmer testified that in 2005 there was a power of attorney with Chesky Braun, who was his brother-in-law at the time, and that Chesky Braun used that power of attorney to take over the building by transferring the deed to himself. In 2018, pursuant to a decision in Supreme Court, the deed transfer to Chesky Braun was nullified and the property was transferred back to Petitioner. Mr. Schwimmer credibly testified that on January 6, 2019, he went with his mother and father to speak to Respondent Ms. Santos, and Ms. Santos told him she is paying $1,250/month in rent, that Chesky Braun rented the premises to her, and that she will only deal with him. Mr. Schwimmer testified that prior to this holdover, they commenced a non-payment to try to bring Ms. Santos to the table to discuss her tenancy, but she refused, and the case was discontinued. Mr. Schwimmer testified that Petitioner accepted LRAP in the amount of 1,400.00/month for 12 months. On cross-examination, Mr. Schwimmer testified that since 2018 he has collected rents and entered into leases with tenants at the property, and that three separate tenants entered into leases with him. Mr. Schwimmer testified that he never used a broker to rent apartments, that there is no apartment in the basement, and that prior to meeting Ms. Santos he did not know who she was. Mr. Schwimmer testified that Ms. Santos gave him her name on the spot, that he was hoping she would cooperate with him, but she did not. Mr. Schwimmer testified that he recently found out from Chesky Braun that her rent was $1,250.00/month and that Chesky Braun told him that she has not paid for nine months. Respondent Cheryl Santos testified on her own behalf. Ms. Santos credibly testified that in 2013 she went to a real estate agent and filled out a rental application (R. Ex. G, Rental Application), and that Chesky Braun took her to see the apartment. Thereafter, she saw the apartment and entered into a lease agreement between herself and Chesky Braun for a period of one-year and moved into the apartment in January of 2013. (R. Ex. H, Lease Agreement). She paid her monthly rent of $1,150.00 to Chesky Braun in cash. Chesky Braun came to her apartment monthly to pick up the rent. After a year, she started paying $1,250.00/month to Chesky Braun. Ms. Santos introduced book receipts that she kept showing monthly payments (Collectively, R. Ex. J). Ms. Santos testified that she was not aware of a Supreme Court action and did not know that ownership changed until Barbara Schwimmer and her family knocked on her door. Discussion: There are two central issues at dispute in this proceeding. The first is whether Chesky Braun acted as an agent of Petitioner Barbara Schwimmer at the time Respondent entered into the lease agreement with Chesky Braun and took possession of the premises, rendering the licensee notice of termination defective. The second is whether Respondent, sued herein as a licensee and served with a 10-day notice, is a tenant at will or by sufferance, which tenancy may only be terminated by written notice of not less than 30 days. The court will address the agency analysis first. “Agency is a legal relationship between a principal and an agent. It is a fiduciary relationship which results from the manifestation of consent of one person to allow another to act on his or her behalf and subject to his or her control, and consent by the other so to act (citations omitted). The agent is a party who acts on behalf of the principal with the latter’s express, implied, or apparent authority.” (See, Maurillo v. Park Slope U-Haul, 194 AD2d 142,146 [2nd Dep't 1993]). Furthermore, the party seeking to establish the agency, in this case Ms. Santos, must prove that the principal, Ms. Schwimmer, consented to the agent, Mr. Braun, acting on her behalf and subject to her control, and that the agent agreed to so act. (See, 5015 Art Finance Partners, LLC v. Christie’s, Inc, 58 AD3d 469 [1st Dep't 2009], quoting Fils-Aime v. Ryder TRS, Inc, 40 AD3d 917 [2nd Dep't 2007]; see also, New York Times Co v. Glynn — Palmer Associates, Inc, 138 Misc. 2d 862, 864 [Civ Ct, New York County 1988] ["Customs and usage in the industry, the circumstances of the transaction and the form of the actual agreement may be examined to determine the scope of the agreement between the agent and the third party (citations omitted)."]). “It is undisputed that an agency may be established by conduct, as well as by a written or oral contract (citation omitted). Further, an agency relationship established by conduct may create an agency of apparent authority, established by words or conduct of a principal communicated to a third party, if it gives rise to an apparent and reasonable basis by the third party that an agency has been created and the agent possesses the authority to enter into a transaction (citations omitted). Such apparent authority may exist even if the principal did not actually subjectively intend to create an agency relationship, as long as the third party’s reliance upon the principal’s statement or conduct is reasonable (citation omitted).” (See, Standard Builders Supplies v. Gush, 206 AD2d 720 [3rd Dep't 1994]). Apparent authority must be case on “words or conduct of the principal, communicated to a third party, that give rise to the appearance and behalf that the agent possess authority to enter into a transaction. The agent cannot by his own acts imbue himself with apparent authority.” (Hallock v. State, 64 NY2d 224, 231 [1984]). “Rather, the existence of ‘apparent authority’ depends upon a factual showing that the third party relied upon the misrepresentation of the agent because of some misleading conduct on the part of the principal — not agent.” (Id., citing Ford v. Unity Hosp., 32 NY2d 464, 473 [1973]). After the testimony and evidence presented by the parties, the Court finds that in light of all of the surrounding circumstances, from February 7, 2012 to October 3, 2018, Chesky Braun did not have actual or apparent authority from Barbara Schwimmer to continue management of the property, to enter into leases or collect rents at the property located at 1115 40th Street, Brooklyn, New York 11218. Although the 2005 Power of Attorney was not affirmatively revoked, the two fraudulent transfers of the deed to the property perpetrated by Chesky Braun revoked any authority previously granted to him by Barbara Schwimmer to act on her behalf. Respondent failed to prove that the fiduciary relationship which Chesky Braun had with Barbara Shimmer in 2005 was extended past February 7, 2012 when Chesky Braun extinguished any control Barbara Schwimmer had in the property without her consent. Barbara Schwimmer credibly testified that she did not permit Chesky Braun to transfer the deed to himself, and that immediately after she learned of the transfer she commenced proceedings to nullify his actions. From February 2012 to October 3, 2018, Ms. Schwimmer did not have access to the building and did not participate in any management or control of the property. During Mr. Braun’s fraudulent ownership, Ms. Schwimmer did not give permission to enter into lease agreements and she did not collect or receive rent from any of the occupants. Additionally, by her own admission, Ms. Santos acknowledged that Chesky Braun did not have apparent authority to act on behalf of Barbara Schwimmer at the time he rented the premises to Ms. Santos. In fact, she admitted that she only delt with and recognized Chesky Braun as her landlord. She entered into a rental agreement with him, a lease agreement with his name as the landlord and paid rent solely to him. It is clear from Ms. Santos testimony that she did not know who Barbara Schwimmer was until the day she knocked on her door, and that throughout her entire tenancy she did not rely on any representation to form a believe that Chesky Braun rented the apartment to her at the behest of Barbara Schwimmer. Therefore, based upon the foregoing agency analysis, this licensee proceeding cannot be dismissed solely on the ground that Respondent had a lease because the lease from Chesky Braun was invalid. The absence of a valid lease, however, does not equate to Respondent automatically being classified a licensee. As such, the court now turns to the second prong of analysis to determine whether Respondent, sued herein as a licensee, is actually a tenant at will or by sufferance, which would have entitled Respondent to 30 days written notice as opposed to only 10 days. In this summary proceeding brought pursuant to RPAPL §713(7), Petitioner alleges that Respondent resides in the premises as a licensee and that her license has been terminated pursuant to a 10-day notice to quit. (See, NYSCEF Doc. No. 1). Pursuant to RPAPL 713(7), a special proceeding may be maintained after service of a ten-day notice to quit on Respondent if Respondent is a licensee of the person entitled to possession of the property at the time of the license and (a) Respondent’s license has expired, or (b) Respondent’s license has been revoked by the licensor, or (c) the licensor is no longer entitled to possession of the property. RPAPL §713 applies when no landlord-tenant relationship exists, whereas RPAPL §711 applies when there is a landlord-tenant relationship. “Tenant” includes an occupant who has been in possession for 30 consecutive days or longer, and no tenant or lawful occupant shall be removed from possession except in a special proceeding. (See, RPAPL §711(1)). A tenancy at will or by sufferance, however created, can only be terminated by 30 days’ written notice. (See, RPL §228). The basic distinction between a tenancy at will or by sufferance and that of a licensee is that the former recognizes a landlord-tenant relationship, and the occupant is granted exclusive possession of the premises, whereas in a licensee scenario a landlord-tenant relationship is absent, and the occupant receives only unexclusive use or occupancy of the premises. (See, Sherhan v. Numyal Food, Inc., 20 Misc. 3d 40 [App Term, 2nd Dep't 2008]; Fed’n of Orgs., Inc. v. Bauer, 6 Misc. 3d 10 [App Term, 2nd Dep't 2008] American Jewish Theatre v. Roundabout Theatre Co., 203 A.D.2d 155 [1st Dep't 1994]; see also, Potts v. Thomas, 58 Misc. 3d 311 [Nassau Dist Ct 2017]). A tenancy at will or by sufferance, and not a mere license, is created when Respondent is given the right to exclusively occupy the premises, irrespective of whether rent was paid. (See, Rodriguez v. Greco, 31 Misc. 3d 136(A) [App Term, 2nd Dep't 2011]; Carbonella v. Carbonella, 52 Misc. 3d 141(A) [App Term, 2nd Dep't 2016]). There are also circumstances where occupancy can ripen into a tenancy at will or by sufferance. For example, an owner’s acquiescence in a continued occupancy may justify an inference that a tenancy has been created. A tenancy at will or sufferance may also arise by implication, and an obligation to pay rent is not a necessary incident of such tenancy. (See, City of New York v. Utsey, 185 Misc. 2d 715 [App Term, 2nd Dep't 2000]). “Moreover, a tenant in possession under an invalid lease is a tenant at will and is entitled to the notice requirements by section 228 of the Real Property Law before he can be removed.” (Fischer v. Queens Park Realty Corp., 41 A.D.2d 547, 549 [2nd Dep't 1973]). The evidence at bar clearly establishes that Respondent is not a mere licensee. Petitioner failed to establish that Respondent was a licensee, as there was no proof at trial that Respondent did not have exclusive possession of the premises, and as such, Respondent was, at the very least, a tenant at will or by sufferance, and was entitled to a 30-day notice. (See, Hok Kwan Chu v. Lee, 39 Misc. 3d 147 [App Term, 2nd Dep's 2013). Respondent has occupied the premises from January 14, 2013 until the present. During that nearly 10-year time period, Respondent has had exclusive possession and control of the premises. Furthermore, Petitioner sued Respondent as a tenant in a non-payment proceeding and received rental payments for the premises via LRAP. As such, even if Respondent was not a tenant from the inception of her occupancy of the premises, the foregoing non-payment proceeding, LRAP payments, and the passage of an extended period of time resulted in her occupancy ripening into a tenancy at will or by sufferance. (See, City of New York v. Utsey, 185 Misc. 2d 715 [App Term, 2nd Dep't 2000]). Every petition in a summary proceeding must state Respondent’s interest in the premises and Respondent’s relationship to Petitioner. The foregoing is a jurisdictional requirement. (See, RPAPL §741[2]). On these facts, Respondent was entitled to a 30-day notice and the 10-day notice to quit is an inadequate predicate notice to this proceeding. (See, RPL §228). Accordingly, this proceeding is dismissed. This constitutes the Decision/Order of this court, which shall be uploaded to NYSCEF. The parties can retrieve their exhibits from the clerk in Part O, and the court reserves the right to dispose of any exhibits that are not retrieved within 30 days. Dated: December 20, 2022
