Laureano v. Koch

116 Misc. 2d 287, 454 N.Y.S.2d 956, 1982 N.Y. Misc. LEXIS 3873
CourtNew York Supreme Court
DecidedOctober 13, 1982
StatusPublished
Cited by3 cases

This text of 116 Misc. 2d 287 (Laureano v. Koch) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Laureano v. Koch, 116 Misc. 2d 287, 454 N.Y.S.2d 956, 1982 N.Y. Misc. LEXIS 3873 (N.Y. Super. Ct. 1982).

Opinion

OPINION OF THE COURT

Sheldon S. Levy, J.

Does the City of New York and its agencies, while acting as a landlord, have unlimited discretion to raise the rents of residential tenants in in rem housing? The subject matter has not been dealt with previously and is, accordingly, of first impression. Moreover, the present decision could potentially affect tens of thousands of tenants residing in such buildings.

By this article 78 proceeding, petitioners seek review and annulment of a determination of the Department of Housing Preservation and Development (HPD) by which [288]*288rentals in four tax foreclosed properties, located at 1171, 1175, 1179 and 1186 Clay Avenue in The Bronx, were increased by 50% to 108% per month.

The operative facts may be briefly set forth. Petitioners were tenants in subject apartment houses when their private landlords defaulted in property tax payments and the city took over (Administrative Code of City of New York, § D17-4.0). Thereafter, under HPD’s general management scheme, the properties in issue came under its division of alternative management programs (DAMP), which provides for daily building operation and management by third parties or by tenant associations under its private ownership and management program (POMP). In this case, the four buildings were leased to respondent Annal Management Company, Ltd., whose business is as its name implies, and were scheduled for transfer and sale to Annal in the summer of 1982. The rent increases here involved were in apparent contemplation of that sale.

The ultimate aim of the instant over-all program of HPD is to return abandoned residential buildings to nongovernmental proprietorship; to put them back on the tax rolls; and to recoup thereby some of the moneys expended by the city for repairs and renovations. However, when properties first become in rem, they are removed from all rent protections (Administrative Code, § Y51-3.0, subd e, par 2, cl [f]; § YY51-3.0, subd a, par [1], cl [a]). When transfer and sale back to private ownership finally occurs, properties, which had originally been sublet to either rent control or rent stabilization before gaining in rem status, become rent stabilized at whatever new rent levels have been then fixed by the city (Administrative Code, § YY51-3.3). As a practical matter, of course, the higher the rent roll of a building at the time of a city sale, the higher the sale price for the city.

The clear significance of this awesome city power to set current rents for in rem properties is that new private owners can secure thereby the benefits of rent augmentations far beyond what could have been obtained by prior landlords under rent control or stabilization. The city, however, should not be able so easily to subvert the clear intentions of legislative pronouncements, the plain indicia [289]*289of State-wide public policy and the obviously reasonable aspirations of its citizenry.

When the city becomes the landlord of such in rem buildings, or, alternatively, permits private management under its auspices, those who are lawful residential tenants upon the occasion of such conversion should not be left thereafter to the prevailing breezes of unbridled discretion. Whether or not these original residential tenants of in rem housing have a property right — by virtue of constitutional considerations, legitimate claims of entitlement, attornment or otherwise — they clearly have, at least, a property interest in their own apartment units sufficient to trigger in their favor even more important rights and protections afforded by both the State Constitution and the New York City Charter.

Accordingly, that intrusive institution of in rem land-lordship — although its ultimate objective is surely commendable and constitutional (see Sonmax, Inc. v City of New York, 43 NY2d 253) — must still be administered by the city with circumspection, with common sense and with due care and consideration for the basic constitutional, statutory and human rights of the tenants involved. This is particularly so, since such tenants, through no fault of their own, have frequently become victims of greedy and rapacious former landlords who have “milked” and then abandoned both buildings and tenants.

Unfortunately, it is the least affluent members of our society who are most often the residential occupants of in rem housing. In point of fact, the upshot of the subject rent raises (and which obviously will be sought hereafter in other similarly situated properties) will be effectively to force these low income and minority group tenants, some of whom have resided in subject buildings for over a decade, out of their homes; into a real estate rental market far beyond their means; and ultimately, perhaps, onto public assistance rolls. If the levying of these increases is without proper notice and a meaningful opportunity for the tenants to be heard or is without a decision-base premised on consistent, ascertainable and publicized standards, then the present determination of HPD is unauthorized and cannot be permitted to stand.

[290]*290In the instant case, petitioners were first officially alerted to expect unspecified monthly rent increases by a form letter dated October 30, 1981. One month later, another letter notified each tenant of the precise amount of the new rent set by HPD and announced the effective augmentation date as January 1, 1982. Thereafter, a single meeting between the tenants and officials of HPD was held on the evening of December 16,1981, at which several topics, including the necessity for and calculation of the increases, were discussed. Largely as a result of this meeting, at which no written memoranda, reports, exhibits or schedules were afforded to the tenants, the rent raises were postponed until February 1,1982, and Federal preliminary injunctive relief was sought by other tenants apparently not here involved. As a result of a Federal District Court determination that HPD’s procedures were not violative of the Federal Constitution, but that State constitutional standards specifically were not being considered (see Sidberry v Koch, 82 Civ 334 [SDNY, Pollak, J.]), the instant proceeding was brought.

Initially, it is clear that New York State constitutional safeguards and public policy may be interpreted and construed as being more protective of and responsive to the rights, liberties and needs of State citizens than Federal constitutional standards and national public considerations (see, e.g., People v Belton, 55 NY2d 49, 51; Sharrock v Dell Buick-Cadillac, 45 NY2d 152, 159; People v Isaacson, 44 NY2d 511, 519-520; People ex rel. Walsh v Vincent, 40 NY2d 1049, 1050; People v Hobson, 39 NY2d 479, 483-484; People v Donovan, 13 NY2d 148, 151; Ives v South Buffalo Ry. Co., 201 NY 271, 317). The “unique language of the due process clause” of section 6 of article I of the New York State Constitution (Sharrock v Dell Buick-Cadillac, 45 NY2d 152, 159-160, supra)-, the added provision relating to housing for low income persons (NYS Const, art XVIII, § 1); and this State’s long history of affording significantly enhanced due process protections to its own citizens, combine and buttress an independent construction for our State Constitution. This would seem particularly appropriate where the expectations of all tenants to decent, afforda[291]*291ble housing accommodations — the basic right of shelter for all human beings — is involved.

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Related

DiScala v. Facilities Development Corp.
180 Misc. 2d 355 (Civil Court of the City of New York, 1998)
Laureano v. Koch
100 A.D.2d 192 (Appellate Division of the Supreme Court of New York, 1984)
Eastwood Building Committee v. Berman
118 Misc. 2d 494 (New York Supreme Court, 1983)

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Bluebook (online)
116 Misc. 2d 287, 454 N.Y.S.2d 956, 1982 N.Y. Misc. LEXIS 3873, Counsel Stack Legal Research, https://law.counselstack.com/opinion/laureano-v-koch-nysupct-1982.