November Insights

By Eileen O’Toole, Esq., Contributing Editor

A number of novel court and DHCR decisions are detailed in this month’s issue. In Melendez v. City of New York (LVT #31715), a federal appeals court upheld a lower court ruling that the May 2020 amendment of NYC’s harassment laws, to prohibit “threatening” tenants based on their status as persons affected by COVID-19, did not violate the Free Speech or Due Process Clauses of the U.S. or NY State Constitutions.

The court found no impermissible restriction of commercial speech in the ordinary collection of rents. But the Second Circuit sent the case back to the Southern District Court to re-examine a Guaranty Law, also added by the city in May 2020 to prevent landlords from enforcing personal guarantees in commercial leases. The appeals court found that the Guaranty Law significantly impaired personal guaranty agreements and may violate the Constitution’s Contracts Clause.

Separately, in an HP proceeding, Pang v. Roosevelt Holding (LVT #31674), a housing court ruled that a landlord who forged and posted a marshal’s eviction notice on a tenant’s apartment door during the pandemic period had harassed the tenant. The court imposed over $10,000 in penalties.

Following the August 2021 revision of NY State’s CEEFPA protections under L. 2021, Ch. 417 (eff. Sept. 2, 2021), courts have begun to review landlord challenges to tenant Hardship Declarations and, in several cases, have ordered hearings to rule on landlords’ asserted “good faith belief” that the tenants in question are not entitled to eviction moratorium-based delay due to filed Hardship Declarations.

In Sanchez-Tiben v. Washington (LVT #31673), the landlord lived in the same building and observed the tenant going to work regularly throughout the pandemic months, much as he had previously. The court directed a hearing to address the landlord’s claim that the tenant didn’t qualify for a stay of the eviction proceeding.

In Bitzarkis v. Evans (LVT #31682), the Housing Court also granted landlord a hearing. While not contesting that the tenant had a COVID-related medical condition, the landlord argued that the pandemic couldn’t have affected the tenant's income because HRA public assistance rent payments supported the tenant both before and during the pandemic.

However, in another case, where the issue was whether a so-called “unauthorized occupant” qualified for eviction moratorium protection under CEEFPA as amended by L. 2021, Ch. 417, the Housing Court in Ocean Bay Rad LLC v. Tolliver (LVT #31687) ruled that the amended CEEFPA provision defines a “tenant” to include “any other person responsible for paying rent, use and occupancy, or any other financial obligation under a residential lease or tenancy agreement." And, since the respondent in this case had a responsibility to pay use and occupancy (even if unpaid), he fell within the scope of Hardship Declaration protection.

Unique rent stabilization issues also were addressed in some recent decisions. In 200 Haven Owner LLC v. Drachman (LVT #31675) a court found that, since there was no actual vacancy when a vacancy lease was issued for a remaining rent-stabilized tenant and a new co-tenant, the new lease couldn’t have resulted in vacancy deregulation.

In Morrissey v. 400 West 59th Street Partners LLC (LVT #31686), a court denied the challenge of a formerly rent-stabilized tenant in a 421-a building who sought to extend her expired 421-a status when the building added affordable units under RPTL Section 421-a(17). But, as held by the court, only the existing affordable housing units and the new affordable housing units remained subject to rent stabilization after the 421-a benefits otherwise expired.

In Matter of Slater/SP 41 Park LLC (LVT #31706), the DHCR “deemed” a renewal lease to be in effect on the date that a high-rent/high-income deregulation order was issued in March 2019, apparently to afford the tenant applicability of the Explanatory Addenda that notified the landlord post-HSTPA that if a renewal lease in effect on the deregulation order date expired after June 13, 2019, no luxury deregulation could take effect because high-rent deregulation was by then abolished. The landlord had notified the tenant before the deregulation order was issued that her lease wouldn’t be renewed on the grounds of nonprimary residence. But, once that case was discontinued, the DHCR found grounds to deem a renewal lease.