A very common tactic if for the landlord to seek an eviction of a Rent Stabilized tenant in New York based on an allegation that the landlord intends to use the apartment for his own use. This owner use holdover is the most unpredictable kind of holdover, because once all the facts are in, it is up to the judge to make a gut determination of whether the landlord honestly wishes to use the apartment for the reason he states.

In an owner use holdover, the landlord generally states that a relative wishes to move into the apartment. The landlord can also claim that he needs the apartment because his family is larger and needs more space, and the apartment is part of an overall renovation plan. Still others have gotten creative, and have alleged that they seek to evict the rent stabilized tenant because the space would make a nice library or den.

A savvy tenant has many tools available to defend an owner use holdover. First, the tenant’s attorney has the right to conduct discovery. This means that the landlord has to answer questions under oath in front of a court stenographer, and has to produce documentation of its plans. Second, it is likely that housing court judges are more skeptical of a landlord whose plans seem to be based on luxury more than necessity. The truth is, however, that it all boils down to whether the landlord has a good faith intent to carry out its plan, or whether this is just a sham to evict a rent stabilized tenant for financial reasons.

Some of the technical rules are set forth in the DHCR Fact Sheet, quoted below.

New York State Division of Housing and Community Renewal, Office of Rent Administration

Fact Sheet #10 – Eviction from an Apartment Based on Owner Occupancy
An owner may refuse to renew a rent stabilized tenant’s lease in NYC because the owner wants the apartment for personal use and occupancy as a primary residence for the owner or a member of the owner’s immediate family. Under the Rent Stabilization Law, an owner may begin an eviction proceeding when the current lease expires, but only after the tenant is given written notice that the lease will not be renewed. This notice must be served at least 90 and not more than 150 days before the current lease term expires.

According to the Rent Stabilization Law, only one of the individual owners of a building can take possession of one or more dwelling units for personal or immediate family use and occupancy, even if the building has joint or multiple ownership.

If after an owner recovers possession of the apartment, the owner does not use the apartment(s) as the owner’s or an immediate family member’s primary residence for three years, the owner may lose the right to any rent increases for other apartments in that building for three years.

For rent stabilized apartments outside NYC and for rent controlled apartments statewide, the owner must apply to DHCR for an order granting a certificate of eviction by filing an “Owner’s Application for Order Granting Approval to Refuse Renewal of Lease and/or to Proceed for Eviction for Owner Occupancy” (DHCR Form RA-54). An owner must establish an immediate and compelling need for the apartment. If DHCR grants this certificate, the owner may then proceed in court to evict the tenant.

Additional rules apply to senior citizens and disabled persons concerning evictions based on owner occupancy:

An owner cannot evict a tenant from a rent stabilized apartment in NYC if the tenant or the spouse of the tenant is a senior citizen, 62 years or older, or is a disabled person unless the owner provides an equivalent or superior apartment at the same or lower rent in a nearby area.
An owner cannot evict a tenant from a rent stabilized apartment outside of NYC or a rent controlled apartment statewide when a member of the household lawfully occupying the apartment is a senior citizen, 62 years or older; or, is a disabled person, or is any person who has been a tenant in the building for 20 years or more.
For more information or assistance, call the DHCR Rent InfoLine (718-739-6400) or visit your Borough or County Rent Office.

If a tenant is successful in getting the case dismissed, the consequences are great. After a holdover is dismissed, the Golub notice is likely stale. See South Shore Estates Inc. v. Olsen, NYU 3 /14/01, 20:3 (Civ. Ct. NY County). See also Malafis v. Evans, NYU 6/5/00, 34:2 (Civ. Ct. Kings County). The landlord cannot simply restart the proceeding, but must serve a new Golub notice. Thus, the landlord must renew the lease and await the next “window period,” which is usually two years later. Cacaj v. Levine, NYU 3/11/92, 22.5 (Civ. Ct. NY County); Wilshire Plaza LLC v. Kaye, NYU 1/23/02, 18:5 (Civ. Ct. NY County).

Quite obviously, a lot can happen in two years to make a holdover proceeding a moot point.

For example, the First Department in Berkeley Associates Co. v. Camlakides (NYU 2/15/90, 26:4 [App. Tm. 1st Dept.], aff’d, 173 A.D.2d 193, 569 N.Y.S.2d 629 [1st Dep't 1991], aff’d, 78 N.Y.2d 1098, 578 N.Y.S.2d 872, 586 N.E.2d 55 [1991]) held that a statement in a Golub notice that “you do not occupy the premises as your primary residence” is just a legal conclusion, not a fact. Thus, the bare accusation that you do not live in your premises as your primary residence – without more detail – warrants the dismissal of a nonprimary residence case.

Similarly, several housing courts have found that in situations where there is nothing in the landlord’s Golub notice other than “the bare, unsupported legal conclusion that the premises are not being used as a primary residence,” the notice fails to provide sufficient facts to support a nonprimary residence proceeding. Rose Associates v. Bernstein, 138 Misc. 2d 1044, 526 N.Y.S.2d 383 (City Civ. Ct. 1988); Ohayon v. Rosenberg, NYU 9/5/90, 19:2 (Civ. Ct. NY County); 85th St Properties v. Rollins, NYU 4/16/90, 27:4 (Sup. Ct. NY County). See also Sullivan Properties, LP v. Sanabria, NYU 8/8/90, 18:5 (Civ. Ct. NY County).

Landlords seeking to profit from a climbing housing market, however, often abuse this primary residence rule. While some landlords are “buying out” their tenants for 30 to 80 thousand dollars, others are spending that much on legal fees in frivolous nonprimary residence holdover proceedings, falsely claiming that their tenants don’t live in their apartments.

How strong is a landlord’s nonprimary residence case? First of all, documents count for a lot. According to the newly-revised RSC § 2526.6, a court will look favorably on a tenant whose apartment address appears on his/her

• tax return
• motor vehicle registration
• driver’s license
• voter registration.

Other, less strong, evidence, could be address information on any other government forms, bills, magazines, personal letters, and testimony from neighbors.

There is no specific rule regarding how much evidence is required to win the day. In fact, tenants often get into trouble when they look for bright line rules. For example, tenants often hear that they will lose their apartments if they sleep there for less than 183 days per year. While time away from the apartment is an important factor, the courts generally do not evict tenants who are out of their apartments for a 7-month hospital stay, or are away on business. (Military service and college attendance are almost always never counted. See RSC Section 2523.5(b)(2).)

If your landlord accepts your rent after sending a notice of termination, you can rejoice: a landlord’s court case will generally be dismissed if he accepts rent during the court case. The landlord, however, can ask the court if he can collect money while the case is pending, but he can’t call it rent. Instead of calling it rent, the landlord collects use and occupancy. The use and occupancy is usually the same amount as the rent.

Tenants have the right to oppose any landlord’s request for use and occupancy. Tenants often argue that if they have not done anything to obstruct or delay the court proceedings, they should not have to pay. Also, tenants often ask courts to reduce the rate of use and occupancy based on poor conditions in the apartment.

My advice to tenants, however, is that you should always agree to pay the full use and occupancy in a holdover proceeding. Every month, right on time. First of all, if you win your court case at trial, you will have to pay the use of occupancy anyway. Second, fighting use and occupancy is a foolish waste of time that is better spent trying to win your court case. Third and most important, paying it makes you look at good in front of the judge. Impressions count.

Paying the use and occupancy takes away one claim the landlord has against you. In court, as in sports, every point counts.

Roughly, a motion for discovery seeks two things: a tenant’s documents, and a deposition. In a deposition, a lawyer calls you to her office, asks you questions, and has a court stenographer record your answers.

Tenants frequently oppose discovery motions. If they cannot defeat the motions, they often succeed in limiting their scope. The landlord’s attorney may be requesting documents that are irrelevant, confidential or privileged, and a judge may disallow such demands.

Tenants often make the mistake of having a knee-jerk reaction against discovery. “My landlord wants it – it must be bad!” Other people view the demand for personal records as an invasion of privacy. Tenants can instead use the discovery process as an opportunity to attack the landlord’s case by producing pounds of documents in support of their defense.

If you fail to produce evidence in discovery, you may be prevented from using that evidence in your own defense at trial.

Article I of the New York State Constitution gives you the right to a jury of six persons in most civil trials. RPAPL § 745 gives you the same right in any housing court case. Most tenants prefer to present their cases to juries. One judge can make a mistake, but it is unlikely that six people are going to make the same mistake at once.

Most tenants, however, have unknowingly signed away this right. Look on your first lease; there is probably a clause that waives the jury trial. In some circumstances, this waiver will be disregarded, and the courts have allowed the tenant to go to a jury anyway.

Most subletters (in Manhattan, at least) still have the right to a jury, because they never signed the lease containing the jury waiver. Other court decisions have held that occupants claiming succession rights are not bound by the jury waiver clause.

In Harlington Realty v. Eager, NYLJ, December 13, 1991, p. 21, col.2 (1991), a panel of judges of the Appellate Term, First Department (Manhattan) unanimously held that a co-tenant who failed to sign a residential renewal lease is not bound by a valid jury waiver in the original lease.

In Halbor Realty Co. v. Torrecilla, NYLJ, March 26, 1992, p. 25, col. 2, the same (Manhattan) court held that a lease containing a jury waiver was inapplicable to a tenant who succeeded to a rent-controlled tenancy.

Manhattan Housing Court Judge Doris Ling-Cohan denied a motion to strike jury demand of an occupant claiming succession rights to a rent-stabilized apartment. “It is well settled,” wrote Judge Ling-Cohan “that a jury waiver clause is not enforceable against non-signatories to a lease.” ACP 301 East 69th Street Associates, L.P. v. Blake, NYLJ, October 29, 1997, p. 30, col. 1 (Civ. Ct. N.Y. County).

A lot of landlord’s attorneys ignore tenants’ jury demands, because they doubt that the tenants have paid their jury fees, or they mistakenly believe that the jury waiver in a lease is “self-executing.” These attorneys are often unpleasantly surprised to discover on the day of trial that they are going, not to the courtroom, but to the jury selection room.

If a rent stabilized apartment is occupied, the landlord must get the tenant’s written consent to the improvements in order to qualify for the increase. If the apartment is vacant, the owner does not have to get tenant consent.

In every overcharge case I have ever done, the landlord has claimed that the so-called improvements were done before the client moved in, while the apartment was vacant. This is ironic in situations where the tenant is complaining about lack of repairs. Apparently, the only time that the landlord is working on the apartment is when it is empty!

When the landlord alleges that improvements were made, the most common effective strategy is to compel the landlord to produce every invoice, cancelled check, contract and permit to justify and substantiate ever dollar of so-called improvments.

As Motel 6 learned in the federal Court of Appeals case of Mathias v. Accor, 347 Fed.3d 672, hotels and motels can be found in liable for large punitive damages when they knowingly subject their guests to rooms infested with bedbugs. The Mathias case was important because of the size of the money award; the court awarded $186,000 in punitive damages to each of the two siblings who stayed for one night at a Motel where the managers refused to pay $500.00 for a bedbug extermination. The U.S. Supreme Court had recently set boundaries to limit punitive damages awards in the case of State Farm Mutual v. Campbell. In the bedbugs case, the Seventh Circuit Court of Appeals is testing these boundaries to their limit.

Recently, Judge Cyril Bedford of the Housing Court granted a substantial abatement of 45% of the rent where the tenant’s apartment was so severely infested with bedbugs that he was forced to sleep on a metal cot for six months (bedbugs cannot climb on metal).

Also in New York, two Mexican businessmen who sued Leona Helmsley’s Park Lane Hotel claiming they were devoured by bedbugs there have settled their case for $150,000.

Of course, our firm has been the subject of much publicity regarding our obtaining redress for tenants in bedbug-infested apartments. Rest assured, this is not the last time the courts well have to address the failure to protest residents and guests in hotels and residential buildings.