Down East Properties, Inc. v. DiMase
(Civ. Ct. N.Y. Cty. 8/15/05)
We represented: Petitioner/Landlord
Hon. Laurie Lau, J.H.C.
DECISION and ORDER Upon the foregoing cited papers the Decision/Order in this Motion is as follows:
Petitioner Down East Properties, Inc. ("Down East") commenced this holdover proceeding against respondents Sonia DiMase ("Sonia") and Giovanni DiMase ("Giovanni") to recover possession of apartment 24A ("Apartment") in the condominium known as the Galleria located at 117 East 5th Street. Down East is a British Virgin Island Corporation. Maria DiMase ("Maria") is its sole officer and director and is in exclusive possession of its bearer stock certificate. Prior to her father's death, the stock jointly was owned by Sonia and Giacomo DiMase. Maria and Giovanni are siblings; Sonia and Giovanni are married but enmeshed in a matrimonial action in Supreme Court (350426/03) (the "Divorce Proceeding"). Sonia currently occupies the Apartment; Giovanni has consented to Down East obtaining possession of the Apartment as against him.
Down East previously had commenced a summary proceeding against Sonia and Giovanni (L&T 105169/97) (the "Prior Holdover Proceeding"). The Prior Holdover Proceeding was consolidated with an action for declaratory and other relief in the Supreme Court case. Giacomo DiMase, et el. v. Giovanni DiMase and Sonia DiMase (112331/97). The cases consolidated in the Supreme Court and settled, with all parties represented, pursuant to a stipulation dated August 11, 1998 (the "Stipulation"). Under the Stipulation's terms, Sonia and Giovanni agreed to vacate the Apartment by September 30, 1998, and they consented to a final judgment of possession with forthwith issuance of the warrant of eviction. In consideration, Sonia and Giovanni were to be paid $854,825.00. According to Maria, payments were made to Giovanni in 1998 totaling this amount, with an additional $5,000.00 also paid. In the event payments were not made, Sonia and Giovanni were to send written notice to Down East's attorneys. As it turns out, Down East did not have the warrant issued or executed. Sonia and Giovanni continued to reside in the Apartment.
Family matters again apparently deteriorated and Down East moved in the Supreme Court to enforce the Stipulation and for issue and execution of the warrant of eviction. Justice Lebedeff stated in her March 1, 2004 order:
Consistent with the interim decision and the remarks placed on the record today, the portion of the underlying settlement relating to the rights of possession in relation to Apartment 214A is determined to be abandoned and, given that no party wishes to continue with that claim in the context of this action, any party who has a present right to assert such claim is granted leave to commence such new proceeding as is determined to be advisable by such party.
The court rules upon no other branch of the settlement.
In her referenced remarks, Justice Lebedeff said:
THE COURT: Now on this matter, which the Court has addressed a number of times, on January 29, 2004, I issued an interim decision.
And the purpose of the interim decision, just to recap, is that I was addressing a stipulation of settlement which was entered into in 1998.
Now, all of the motions – and I had several motions that were directed to me – were directed to the specific question of whether the owner of the apartment could still pursue an eviction of Mrs. DiMase who apparently has an exclusive occupancy of the apartment at this time.
For those purposes, it was my determination that the right relief was belated. I've gone through this in a number of decisions. But by the same token, in the interim decision, what I pointed out to everyone, was that for some reason that issue could not be considered settled.
Then the owner of the unit had a right to pursue the possessory question, and I made the observation that one firing that could happen is that the owner might simply wish to proceed in Housing Court.
And some of the reasons that I included were that the husband and the wife were the defendants in this case and now they are in a divorce action and they would be represented by the same attorney, representing both of them.
There were a number of complicating factors, but the one thing I didn't want to do was to leave the landlord whipsawed by not being able to proceed with the possessory claim in a proper forum, whether here or in a new action in Housing Court.
And when I had a telephone conference with both sides, it appeared that there was some question as to whether my decision touched on any other aspect of the settlement that I had not been briefed on. I cannot tell you, and I would not tell you that any decision that I made about pursuing the right to eviction would have the same logic applicable to it in relation to any other portion of the settlement.
And I regarded the right to eviction as entirely distinct from any other claim that was settled.
If there was an argument about any of the claims, they would have to be subsequently briefed, and there are a host of reasons well beyond the scope of my decision, why I would say that.
During her remarks, Justice Lebedeff referred to motions submitted to her. One of the motions, involving the Divorce Proceeding, was referred to Justice Gische for determination. She held in her November 26, 2003 decision:
Although this commercial case is assigned to Hon. Diane B. Lebedeff, she has referred this particular motion only to this Court. The movant is husband's sister, Maria DiMase ("sister"). Briefly, Down East Properties, Inc., a British Virgin Island Corporation, started a holdover proceeding against the tenant-spouses in 1997, seeking to recover the apartment.
The tenants asserted various defenses. The holdover proceeding was consolidated with the declaratory judgment action. The parties resolved these disputes in a written stipulation, so-ordered by Judge Lebedeff on August 7, 1998. The sister now seeks to reargue Judge Lebedeff's recent decision (August 7, 2003), holding that the parties had abandoned the stipulation because it contained a "time of the essence" clause and they waited five years before seeking to recover possession of the apartment now occupied only by the wife.
Judge Lebedeff has, by order dated October 14, 2003, referred the issue of whether the August 7, 2003 decision denying plaintiff's motion, or the present reargument motion by her, has any bearing on this divorce action, or (vice versa) whether the matrimonial action has any bearing on the claims asserted by the plaintiffs.
This Court only considers the remaining and referred issue of whether it should consolidate this case with the matrimonial case. The Court finds that each case has discrete issues and there is no reason to do so.
Though in her underlying motion wife claimed that husband was the motivating force behind his family's renewed interest in this real estate action, that argument has little relevance to the divorce action. Nor would it he a defense to the enforcement of a contract made years before the institution of this divorce action. The family has an independent right to pursue their claims against the tenant-spouses, apart from what may occur in this divorce action. Compare: Wildenstein v. Nineteen East Sixty-Fourth Street Corporation, 177 Misc2d 517 (Sup Ct NY Co. [Diamond] 1998). Wife cannot use the matrimonial action to make her claims in the real estate action any stronger than they already are.
For the foregoing reasons, the Court denies reargument by plaintiff and further denies the renewed application by wife to have these cases consolidated. This real estate action shall remain with Judge Lebedeff and any further motions pertaining to this action are to be properly directed to her.
Down East commenced this holdover summary proceeding after the expiration of a 30-day notice terminating the tenancy-at-will of Sonia and Giovanni.
Sonia answered the petition alleging that Maria is Giovanni's stalking horse and is circumventing the Divorce Proceeding in Supreme Court and the Apartment is at issue there. She further alleges prior actions, and proceedings are pending warranting dismissal of his proceeding. Sonia, further, counterclaims for a declaratory judgment for exclusive title to the Apartment based upon her allegation that Giacomo failed to pay the $849,000.00 agreed upon by the stipulation. Finally, Sonia cross-claims against Giovanni for payment of Apartment expenses as ordered in the Divorce Proceeding.
Sonia now moves by order to show cause to dismiss this proceeding because prior actions are pending (CPLR §3211 [a][4]). Down East cross-moves to strike Sonia's affirmative defenses and counterclaims and for summary judgment. The parties' counsel argued the motions on May 17, 2005 (Tapes N71286/2417-end; N71287/0-1640).
Sonia's motion to dismiss this holdover proceeding is doomed. Justice Gische in the Divorce Proceeding and Justice Lebedeff in the Supreme Court case and Prior Holdover Proceeding clearly determined, respectively, that the Apartment was not part of the Divorce Proceeding and that the Prior Holdover Proceeding had been abandoned. There are, therefore, no prior actions or proceedings pending warranting dismissal of this holdover proceeding pursuant to CPLR §3211(a)(4).
The Court now addresses Down East's cross-motion to strike Sonia's affirmative defenses and counterclaims and for summary judgment. Initially, the Court notes that the Housing Part of the Civil court has no power to exercise injunctive relief (Lozano v. Grunberg, 195 AD2d 308 [1st Dept 1993]) and questions of the and of ownership are not litigable in summary proceedings (Norman Ferber v. Salone Moderne, Inc., I74 Misc 2d 945 [App. Tem 1st Dep't]). Thus, Sonia's counterclaim for declaratory relief, e.g. providing to her exclusive title to the Apartment, must be and is stricken. Sonia's first affirmative defense also warrants being stricken, and it is, for the same reason. The Court notes that Justice Gische specifically held that the family independently could pursue claims against the spouses, separate from the Divorce Proceeding and found "little relevance" to any motivations of Maria [as the stalking horse] or Giovanni. Sonia's affirmative defense alleging no capacity to sue and that there is no cause of action also is dismissed for the same reasons.
Having granted in its entirety Down East's motion to strike Sonia's affirmative defenses and counterclaim, the Court now considers Down East's motion for summary judgment. In considering a motion for summary judgment, the Court is confined to determining whether an issue of fact exists as a matter of law (State of New York v. Metz, 241 AD2d 192 [1st Dep't 1998]). Thus, a party opposing a motion for summary judgment must produce evidentiary proof in admissible form sufficient to establish the existence of material issues of fact which would require a trial (Zuckerman v. City of New York, 49 NY2d 557 [1980]), and the credibility of the parties is not a proper consideration for the Court (Garay v. Blankroth, 156 AD2d 170 [1st Dept1989]).
Applying those principles here, the initial question is whether Down East can establish its interest to the Apartment (RPAPL §74111]) and can maintain this proceeding (RPAPL §721). The answer is in the affirmative: Maria is the sole officer and director of Down East and is the holder of the bearer stock certificate for Down East. Further, there is competent evidence that Down East is the owner of the Apartment and is entitled to possession of the Apartment.
The next question is whether Down East can maintain this proceeding against Sonia and Giovanni. The answer is in the affirmative as there exists no stays from any of the Supreme Court eases and no bars to Down East seeking to recover possession of the Apartment from Sonia and Giovanni. There is not any question of any stays: neither Justices Lebedeff nor Gische stayed Down East from proceeding in Housing Court in a new proceeding. What Justice Lebedeff did bar was Down East's attempt to enforce the Stipulation's possessory terms regarding the Apartment as she considered that aspect of the Stipulation abandoned. The remarks upon which she built her order clarify that point: "'The only thing I didn't want to do was to leave the landlord whipsawed." Petitioner therefore properly commenced this proceeding against Sonia and Giovanni.
The next question is whether Sonia and Giovanni are "tenants-at-will" as alleged in the 30-day notice. The answer is in the affirmative: The Stipulation settled the substantive disputes between Sonia and Giovanni, on the one side, and Giovanni's father and siblings on the other side. The Stipulation was made years before Sonia commenced the Divorce Proceeding. The Stipulation gave Sonia and Giovanni cash consideration for their relinquishment of claims to various of the DiMase family holdings, including the Apartment. That substance cannot be either ignored or vitiated: although Down East forbore the eviction of Sonia and Giovanni from the Apartment, the Stipulation clearly enunciated that Sonia and Giovanni had the ownership right to the Apartment and specifically had relinquished any right that they thought they might have to the Apartment. Under such circumstances, "an owner's acquiescence in a continued occupancy (where the occupancy is subordinate to the title of the owner) may, where the facts so warrant, justify an inference that a tendency at will has been created," (City of New York v. Utsey, 185 Misc.2d 715 [App. Term 1st Dep't 2000]). Here, the parties entered into exactly the sort of agreement contemplated by the court. They were tenants-at-wilI and the 30-day notice properly terminated that tenancy.
The motion for summary judgment is granted as Down East sustained its burden in establishing the prima facie elements of the petition. The Court notes that Sonia does not dispute the certified documentation from the state and City agencies which further comprise the elements of the prima facie showing.
Accordingly, Down East is awarded a final judgment of possession against Sonia and Giovanni with issuance of the warrant of eviction stayed ten (10) days.
This is the decision and order of the Court.
Dated: New York, New York
August 15, 2005