Ioannou v. 1 BK St. Corp.

2025 NY Slip Op 31426(U)
CourtNew York Supreme Court, New York County
DecidedApril 22, 2025
DocketIndex No. 160523/2019
StatusUnpublished

This text of 2025 NY Slip Op 31426(U) (Ioannou v. 1 BK St. Corp.) is published on Counsel Stack Legal Research, covering New York Supreme Court, New York County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ioannou v. 1 BK St. Corp., 2025 NY Slip Op 31426(U) (N.Y. Super. Ct. 2025).

Opinion

Ioannou v 1 BK St. Corp. 2025 NY Slip Op 31426(U) April 22, 2025 Supreme Court, New York County Docket Number: Index No. 160523/2019 Judge: Shlomo S. Hagler Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. INDEX NO. 160523/2019 NYSCEF DOC. NO. 127 RECEIVED NYSCEF: 04/22/2025

SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY PRESENT: HON. SHLOMO S. HAGLER PART 17 Justice -------------------X INDEX NO. 160523/2019 ATHAS IOANNOU MOTION DATE 02/02/2024 Plaintiff, MOTION SEQ. NO. 003 -v- 1 BK STREET CORP. DECISION + ORDER ON MOTION Defendant. --------·-----------X

The following e-filed documents, listed by NYSCEF document number (Motion 003) 69, 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 100, 101, 102, 103, 104, 105, 106, 107, 108, 109,110,111,112,113,114,115,116,117,118,119,120,121,125 were read on this motion to/for JUDGMENT-SUMMARY

In this action seeking a rent-stabilized lease and damages for rent overcharges, plaintiff

Athas Ioannou ("plaintiff') moves pursuant to CPLR 3212 for an order granting summary

judgment in his favor and dismissing defendant 1 BK Street Corp.'s ("defendant") counterclaim

for attorneys' fees. Defendant opposes. Upon the foregoing cited papers and after hearing oral

argument on May 22, 2024, plaintiffs motion is granted in part.

I. Procedural History and Factual Background

The following facts are drawn from the complaint and the affidavits. Plaintiff commenced

this action on October 29, 2019. Defendant is the owner of the building located at 1-7 Bank St,

a/k/a 87-95 Greenwich Ave, New York, New York (NY St Cts Elec Filing [NYSCEF] Doc No.

73, Complaint ,r,r 2, 4). Plaintiff is a tenant of apartment 2M ("apartment") (id. ,r,r 3, 5). The

building received J-51 benefits continuously from 1977 through June 30, 2011 (id. ,i 7).

Plaintiff initially became a tenant pursuant to a lease for a term commencing November

13, 2006 and ending November 30, 2007, at a rent of $3,200 per month ("Ioannou Affidavit")

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(NYSCEF Doc No. 71 ,i 5). The lease did not have a rent stabilization rider or a J-51 rider attached

(id ,r 6). Plaintiff was not offered an opportunity to sign a two-year vacancy lease, and defendant

did not notify him that the building was receiving J-51 benefits (id. ,i 7-8). Plaintiff was not offered

a renewal lease when the lease expired on November 30, 2007, and defendant continued to charge

plaintiff $3,200 per month through the date of this motion, which he paid (id. ,r,i 11-12). Plaintiff

continues to pay a rent of $3,200 per month. Plaintiff further alleges that he was served with a

Holdover Notice of Petition and Petition in 2012, which included a statement that "the apartment

is not subject to Rent Stabilization Law because the monthly rent exceeds $2,000 per month" (id.

,r I 0). Plaintiff claims that according to the rent registration records filed by defendant with the New York State Division of Housing and Community Renewal ("DHCR"), the rent for the

apartment was $543.56 per month, as of April 1998, when the apartment was registered as rent

controlled (Complaint ,i 28).

Isabel Negron ("Negron"), the property manager for defendant, claims that defendant

deregulated the apartment in 2000 based upon and in reliance on DHCR's guidance ("Negron

Affidavit") (NYSCEF Doc No. 100 ,r 4). Negron claims that defendant was not aware of the court

decisions and did not act in a fraudulent scheme when it deregulated the apartment in 2012 or in

2006 when it offered plaintiff a lease at $3,200 a month (id.). Negron disputes the last registered

rent for the apartment and claims that per the DHCR rent roll, the last registered rent is $2,000 and

not $543.56 (id. ,r 7).

Around 1999-2000, a rent-controlled tenant, Moran, vacated the apartment, and defendant

performed individual apartment improvements ("IAI"), by which defendant increased the rent to

$2,000 a month (id. ,i 8-9). Defendant stopped registering the rent for the apartment with the DHCR

(id. ,r 10). In 2000, defendant entered into a market free lease with a tenant named Mulloy, who

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was required to pay $2,000 per month as defendant believed in good faith the apartment was

deregulated (id ,r 13). From 2002-2003, the second and third lease with Mulloy required him to

pay $2,350 under the same belief (id ,r 14-15). From 2004-2005, defendant entered into a free

market lease with a tenant named Carella, which required him to pay $2,450 per month under the

same belief, and in 2006, the rent was increased to $2,550 per month (id ,r,r 17-19). In 2006,

relying on the past leases and good-faith belief that the apartment had been deregulated, defendant

entered into a lease with plaintiff requiring him to pay $3,200 per month (id ,r 21). Negron further

claims that defendant did not offer a renewal lease to plaintiff in good faith reliance on the then-

current law and DHCR guidance that the apartment was not subject to rent stabilization laws (id

,r 22). Only after this lawsuit and discovery, defendant became aware that the law had changed, and DHCR's 1996 guidance was held to be incorrect (id ,r 25). Once defendant became aware of

the change in the law, it took steps to ensure the apartment was properly registered as rent-

stabilized (id ,r 26). The apartment is listed as rent stabilized in the 2022 and 2023 registration

statements with DHCR (id ,r 27).

Plaintiff alleges three causes of action against defendant. The first is for rent overcharges.

The second is for a declaratory judgment for a rent stabilized lease and to award plaintiff a monthly

rent of $543.56 for a period of two years and an expiration date of two years and ninety days after

a final unappealable judgment is rendered in this action and served with a notice of entry. The third

is for an award of attorneys' fees (Complaint ,r,r 40-63). Defendant filed an answer with general

denials, affirmative defenses and a counterclaim for attorneys' fees (NYSCEF Doc No. 74,

Answer).

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II. Parties' Contentions

Plaintiff contends that either under the prior law or the new law pursuant to the 2023 NY

Senate Bill S2980-C and Matter of Regina Metro. Ca., LLC v New Yark State Div. of Hous. &

Community Renewal, 35 NY3d 332 [2020], defendant is liable for a fraudulent scheme to

deregulate the subject premises (NYSCEF Doc No. 84, Memorandum of Law in Support of Dov

A. Treiman, Esq. [memo] at 5). Plaintiff takes the position that defendant failed to register the

premises at the proper rent, failed to provide a rent stabilization rider to the lease, failed to provide

a J-51 rider, and denied the rent stabilization status in its answer (id. at 6). Plaintiff argues that

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2025 NY Slip Op 31426(U), Counsel Stack Legal Research, https://law.counselstack.com/opinion/ioannou-v-1-bk-st-corp-nysupctnewyork-2025.