Couri v. Pavia
(Sup. Ct. N.Y. Cty. 8/12/05)
We represented: Plaintiff/Landlord
Hon. Joan A. Madden, J.S.C.
DECISION and ORDER Plaintiffs moves, by order to show cause, seeking an order, pursuant to 5210, adjudging defendant James Couri ("Couri") in contempt based on his failure to obey this court's February 9, 2005 decision and order directing Couri to deposit with the Court, by March 11, 2005, (1) past use and occupancy for the period from November 2002 to present at the legally regulated rate of $1,820 per month, less the $3,716.62 owed to Couri for overcharges together with the excess security amount found by the Rent Administrator, and (2) future use and occupancy in the amount of $1,820 per month. Couri opposes the motion and cross moves for various relief.
Background
Plaintiffs George Pavia and Antonia Pavia (hereinafter "the Pavias") are the owners of 18 East 73rd Street in Manhattan (hereinafter "the Building"), and reside on its top floor. Defendants reside in Apartment 3-B. Defendants entered into a two-year lease with the Pavias for the period between October 15, 1996 through October 14, 1998, at an initial rent of $1,750.00 per month. The lease was subsequently renewed for another two-year term at a rent of $1,855.00 per month.
In July, 2000, Couri filed a challenge to the initial rent with the New York State Division of Housing and Community Renewal ("DHCR") alleging that the rent "exceeded the fair market rent." The Pavias countered that the Building was not subject to rent stabilization as it went through a substantial rehabilitation in 1989-1990 within the meaning of Section 2520.1 l(e) of the Rent Stabilization Code.
By decision dated November 13, 2002, the Rent Administrator determined that the Building was subject to the rent stabilization code. and found that the Pavias charged $35.00 per month more than the legal regulated rent for period between October 15, 1998 and November 14, 20021 for a total overcharge of $1,715.00, and that the Pavias collected excess security from Couri in the amount of $1,680.00. Thus, the total amount due to Couri was $3.716.62. The Rent Administrator found that the overcharge was not willful, and did not award treble damages. The Rent Administrator directed that the owner of the Building refund or credit Couri for any rent in excess of the legally regulated rent and to offer Couri "a renewal lease, along with a Rent Stabilization rider, for one or two year's, at the tenant's option, based on the legally regulated rent of $1,820.00."
This action was commenced on November 15, 2002, by Order to Show Cause in which the Pavias sought to compel access to defendants' apartment in order to fix a water leak. The first cause of action seeks damages in the amount of $25,000, allegedly caused as a result of the water leak; the second cause of action seeks an order directing defendants to provide the Pavias with a set of keys to defendants' apartment; and the third cause of action seeks an order requiting defendants to give them access to the apartment to fix the leak.2 Defendants subsequently answered the complaint and asserted five counterclaims).3
In the meantime, the Pavias filed a petition for administrative review ("PAR") of the Rent Administrator's determination. The DHCR upheld the Rent Administrator's determination and directed the Pavias "to register the subject building under rent stabilization." The Pavias then brought an Article 78 proceeding challenging the DHCR's determination, which was pending at the time that plaintiffs made a motion seeking use and occupancy. On April 23, 2004. Justice Diane A. Lebedeff denied and dismissed the petition for Article 78 relief. Nonetheless, the Pavias have not complied with DHCR's orders requiting them to provide Couri with a rent stabilized lease and to register the Building under the rent stabilization laws.
During the time that the Pavias were appealing the Rent Administrator's determination Couri continued to tender rent to the Pavias in the amount of $1,855.00. The Pavias forwarded the checks to counsel, who rejected the checks and returned them to Couri, with an explanation that his creation of a nuisance in violation of the lease prevented the acceptance of the checks.4
In or about July 16, 2003, Couri was served with a notice of termination of his tenancy pursuant to Rent Stabilization Code ? 2524(b), the notice alleged that Couri was committing a nuisance in the Building by, inter alias, (i) sending harassing letters to Mr. Pavia containing insults, racial slurs, and threats directed at Mr. Pavia; (ii) making harassing telephone calls involving threats and abusive language; (iii) engaging in a letter writing campaign of unfounded complaints directed against Mr. Pavia and sent to various individuals and entities, including, the New York Bar Association, New York Times, other tenants in the Building, and the New York City Police Department; and (iv) harassing tenants in the Building, including one tenant who eventually abandoned his apartment as the result of such harassment. The notice purported to terminate Couri's tenancy on August 7, 2003. The Pavias then moved to amend their complaint to add a cause of action for ejectment based on the allegations in the termination notice. By decision and order dated January 30, 2004, this court granted the motion to amend.
The Pavias moved for an order directing that Couri pay use and occupancy in the amount of the legally regulated tent set by the DHCR for the period from November 2002 to the present and until the underlying action is resolved. The Pavias asserted that they refused to accept rent from Couri to preserve their rights to evict defendants based on Couri's conduct creating an alleged nuisance.
Couri opposed the motion and cross moved for various relief, including an order directing that the Pavias immediately comply with the DHCR order to register the Building under the rent stabilization laws.
By decision and order dated July 12, 2004, this court found that the Pavias' failure to follow the registration requirements did not prevent them from collecting rent, but rather barred them from "applying for or collecting any rent in excess of: the base date rent, plus any lawful adjustments allowable prior to the failure to register." See Rent Stabilization Code ? 2528.4 (a). The court noted that the DHCR found that the base date rent (i.e. as of July 10, 1996 or four years prior to Couri's filing a proceeding) was $1,600 per month and that with allowable increases, the legally regulated rent for the apartment was $1,820 per month from October 15, 1998 to date.
Nonetheless, the court held that the equities of the case did not warrant requiring Couri to pay the Pavias use and occupancy since such payment was predicated on "a theory of quantum meriut, and is imposed for by law for the purpose of bringing about justice…." Eighteen Assoc. LLC v. Nanjim Leasing Corp., 257 AD2d 559, 560 (2nd Dept 1999); Haberman v. Singer, 3 AD3d 188 (1st Dept 2004). On the other hand, the court recognized that the defendants continue to occupy their Apartment, that plaintiffs had a potentially meritorious claim for ejectment against defendants, and that the record did not indicate that the defendants had suffered from a decrease in services which would warrant denying use and occupancy or reducing the amount of the legally regulated rent.
Taking all these factors into account, the court found that the Parkas were not entitled to use and occupancy until they provided proof of compliance with the DHCR" s order requiring there to give Coati a rent stabilized lease, and to register the Building in accordance with the rent stabilization laws, or upon further order of this court. However, the court also found that as Couri continued to occupy the Apartment, and that the dispute between the parties had not yet been resolved, that Couri should be required to deposit with the Clerk of the Court (1) past use and occupancy for the period from November 2002 to present at the legally regulated rate of $1,820 per month, less the $3,716.62 owed to Couri for overcharges together with the excess security amount found by the Rent Administrator, and (2) future use and occupancy in the amount of $1,820 per mouth. The court permitted Couri to suggest an alternative to the court, such as a lawyer's escrow account, far the deposit of use and occupancy. However, as the parties could not agree on an appropriate alternative for the placement of the funds Couri was required to deposit the money with the court.
Couri moved, by order to show cause, for relief from the court's decision and for a reduction of rents, based on the Pavias' failure to register the Building and the issuance of certain additional notices of violation by the Department of Buildings regarding a greenhouse at the Building.
By decision and order dated February 9, 2005, the court denied Couri's application for relief. The court found that although Couri had provided the court with evidence of notices of violation issued by the Department of the Buildings, that such notices alone were insufficient to relieve Couri from his obligation to payment of use and occupancy at the legal rate as set by the DHCR, particularly as defendants continue m reside at the Apartment, and that Couri provided no evidence of that the DHCR has reduced the legal rent based on any violations. In addition, the court wrote that it was unclear that the issue regarding the reduction of rent was properly before the court, and that there was insufficient evidence that a reduction of rent was warranted based on the alleged violations concerning the greenhouse. The court then directed Court to deposit with the court by March 11, 2005, (1) past use and occupancy for the period from November 2002 to present at the legally regulated rate of $1,820 per month, less the $3,716.62 owed to Couri for overcharges together with the excess security amount found by the Rent Administrator, and (23 future use and occupancy in the amount of $1,820 per month.
By decision and order dated February I6, 2005, this court declined to sign Couri's proposed order to show cause seeking to reduce the rent and staying the collection of use & occupancy, and staying the effect of the February 6, 2005 order. A subsequent order to show cause which sought similar relief was withdrawn by Couri.
The Contempt Motion
The Pavias now move, by order to show cause, to hold Couri in contempt for failing to comply with the February 9, 2005 order directing him to deposit past and future use and occupancy with the court.
Couri opposes the motion, asserting in his affidavit that his "financial circumstances and other conditions have changed, in view of my serious medical emergency and operations, expenses and surgery and other overhead expenses that I encountered, and I am not able to work…All I need is time, as I always pay my bills and my credit is impeccable." In support of his position, Couri submits evidence that he underwent surgery in April 2005, and a copy of a bill from the hospital where the surgery was performed indicating a balance of $15,540.18, on which there is a handwritten notation that it is a "partial bill."
Judicial, Law ? 7535 provides, in relevant part:
- A. A court of record has power to punish, by fine and imprisonment, or either, a neglect or violation of duty, or other misconduct, by which a right or remedy of a party to a civil action…pending in the court may be defeated, impaired, impeded, or prejudiced, in any of the following cases: 1. [A] person …for disobedience to a lawful mandate of the court ….
A finding of civil contempt requires a finding that (1) a lawful order of the court which expresses a clear mandate was in effect, (2) the order has been disobeyed, (2) the party to be held in contempt had knowledge of the order, (4) a right of a party has been prejudiced. McCormickv. Axelrod, 59 NY2d 574, 583 (1983). "Although a proceeding to punish for civil contempt is a civil proceeding, it is quasi criminal in character. Therefore [the party seeking all order of contempt] must be requited to establish an affirmative case by more than a fair preponderance of the evidence." Hynes v. Hartman, 63 AD2d 1, 3 (1st Dept), appeal dismissed 45 NY2d 838 (1978).
Here, the Pavias have Established these four requirements by a preponderance of the evidence. The court order of February 9, 2005, which remains in effect, expresses a clear direction that Couri pay use and occupancy into the court by March I 1, 2005, and there is no dispute that Couri failed to comply with this order, or that he had knowledge of the order. Moreover, Couri's failure to comply with the order prejudiced the Pavias as it deprives them of the ability to obtain moneys for payment of use and occupancy in the event they prevail in the action.
The issue that remains, then, is whether Couri has provided a sufficient excuse to explain his failure to comply with the order "[W]here a party alleges an excuse for disobedience to a judgment or order of a court or alleges matters in mitigation, the burden of proof is on him to establish the same. Such burden must be made by a factual showing. Vague and conclusory allegations of sickness or inability to perform are insufficient." Hildreth v, United Trust Co. Of New York, 28 AD2d'290, 294 (1st Dept 1967); see also, Loewenstein v. Loewenstein, 201 AD2d 286 (1st Dept 1994) (husband's bare claim of inability to pay child support order insufficient to justify hearing on wife's contempt motion).
The court notes that throughout the action, Couri has maintained that he was able to pay use and occupancy and objected to the payment on various other grounds, including that the Pavias failed m comply with DHCR's direction to register the Building or to provide him with a rent stabilized lease, and that the certain violations should reduced the amount of use and occupancy to be paid. Moreover, Couri's affidavit does not delineate the nature of his financial problems except to assert that his recent illness has made it difficult to work. For example, he does not provide any proof that he does not have any savings from which he would be able to pay the use and occupancy, or indicate his income or the nature of his employment. In fact, as he has not paid any rent since November 2002, he presumably should have additional funds. Moreover, the sole evidence he submits which tends to show the impact of his illness on his ability to pay use and occupancy is a medical bill for about $15,500. In addition, Couri does not indicate whether or not insurance will cover dome or all. of his medical expenses.
That being said, however, Couri has submitted to the court proof supporting his claim that he underwent surgery and was hospitalized in April, 2005. Thus, there is some substantiation for Couri's position, which were warrant a hearing to determine whether he is unable to comply with the court older. In re Hildreth, 28 at 294-295 (when on an application for contempt "it appears that there is a bona fide dispute in material and relevant facts, the court may set the matter down for a hearing"); see also, Richardson y. Gray, 284 AD2d 198 (1st Dept 2001).
Accordingly, a hearing wilt be held regarding Couri's financial ability to comply with the court's order, at which Couri will have the burden of demonstrating through admissible evidence (including bank statements, medical bills, insurance information) that due to financial circumstances arising from his recent illness, that he is unable to comply with the court's directive that he deposit the amount of use and occupancy in accordance with the court's February 9, 2005 order.
Couri's Cross Motion
Couri cross moves for, interalia, an order (1) directing the Pavias to make certain repairs, (2) directing the Pavias to provide a rent notice for arrears pursuant to certain provisions of the Real Property Actions and Proceedings Law ("RPAPL'), (3) directing that all payments of use and occupancy be made to a special escrow account at the law firm representing defendant Marlene Couri, (4) dismissing Pavias' cause of action relating m the leak and preclude all evidence relating the leak, (5) precluding all evidence relating to Pavias' nuisance claim, (6) allowing a reduced amount of use and occupancy to be paid into escrow, (7) directing Pavias to establish their ownership of the building, and (8) enjoining the Pavias from harassing Couri and interfering with the use of his apartment. Couri also seeks, based on his purported changed financial circumstances, an order permitting him to pay use and occupancy into escrow on an ongoing basis and that any documented arrears be paid over 30 months in equal installments On the return date, counsel for the Pavias waived their fight to respond to the cross motion.6
At the outset the court notes that many of Couri's requests for relief in the cross motion have been made repeatedly throughout this litigation and have been repeatedly denied by this court. On this ground Couri's requests for an order directing the Pavias to make certain repairs, dismissing Pavias' cause of action relating _c the leak, allowing a reduced amount of use and occupancy to be paid into escrow, and enjoining the Pavias from harassing Couri and interfering with the use of his apartment must be denied.
Couri's request that payments for use and occupancy be paid into an escrow account has also previously been denied since the parties could not agree on the terms of such escrow agreement or where the funds should be deposited. Couri's request that the Pavias provide a "notice for rent arrears" in accordance with RPAPL 711 and 735 is denied, as these statutory requirements are apply to summary proceedings, and not to this plenary action. Furthermore, there is no basis for requiring the Pavias to establish the ownership of the building or to preclude any evidence to support their claim concerning the leak or their nuisance claim.
Finally, Couri's request that he be permitted to pay use and occupancy on a current basis and pay arrears over thirty months is denied in the absence of sufficient evidence to support his asserted claim that a change in Couri's financial circumstances warrant such an order.7
Conclusion
In view of the above, it is
ORDERED that Pavias' motion seeking to adjudge Couri in contempt for failing to obey by March this court's February 9, 2005 order directing Couri to deposit with the Court by March 11, 2005, (1) past use and occupancy for the period from November 2002 to present at the legally regulated rate of $1,820 per month, less the $3,716.62 owed to Couri for overcharges together with the excess security amount found by the Rent Administrator, and (2) future use and occupancy in the amount of $1,820 per month, is granted to the extent of setting the matter down for a hearing on the sole issue of whether Couri can demonstrate that his recent illness and hospitalization caused him financial harm which prevented him from complying with the February 9, 2005 order; and it is further
ORDERED that the contempt hearing shall be held on August 15, 2005 at 9:30 am in Part 11, room 351, 60 Centre Street, New York, NY; and it is further
ORDERED that Couri's cross motion denied.
DATED: August 12, 2005 J.S.C.
1 Since Court was not offered another lease after the second lease for a two-year term expired on October 14, 2000, the DHCR considered Couri's occupancy to be on a month to month basis.
2 The cause of action regarding access to the defendants' apartment to fix the water leak ismoot as such access has already been provided.
3 In 2003, Couri brought an action under Index No. I01709/03 ("the 2003 action") containing five claims virtually identical to the counterclaims in this action, except that in addition to the Pavias, it names the Pavias' attorneys as defendants. In 2004, Couri commenced another action under Index No. 106226/04 ("the 2004 action"). The first two causes of action in the 2004 action are similar to the first two causes of action in the 2003 action. The third cause of action, apparently for malicious prosecution, abuse of process, and false arrest is similar to the third cause of action in the 2003 action, except it focused on subsequently occurring facts. By decision and order dated October 12, 2004, the court denied defendants' motion to dismiss the 2004 action on the grounds that Couri's claims in the most recent action were virtually identical to the claims in the 2003 action instead, the court consolidated the 2003 and 2004 action. However, the court dismissed the counterclaims in this action since they were identical to the claims in the 2003. In its decision and order dated February 8, 2005, the court dismissed the third, fourth and fifth causes of action (respectively for abuse of process, libel and slander, and tortious conduct) once contained in the 2003 action.
4 There is a dispute between the parties as to whether Couri enclosed a check with each of the letters sent to the Pavias in which he purported to pay the rent. As of June 2003, Couri began to tender the checks to his own counsel.
5 Pavias incorrectly seek contempt pursuant to CPLR 5210, which applies to contempt in connection with enforcement proceedings. As there has no been no judgment against Couri, this section is inapplicable. At the same time, however, this court has jurisdiction based on Couri's failure to comply with this court's order directing that he deposit money for the payment of use and occupancy with the court pending resolution of this action, as this order does not "merely award an ordinary money judgment that could have been collected by execution." Dilorio v.Gibson & Cushman of New York, Inc., 198 AD2d 34 (1st Dept 1993), lv dismissed, 83 NY2d 796 (1994).
6 Counsel for the Pavias asserted that they did not receive Couri's papers; however, Couri provided a Federal Express receipt indicating that his papers were to delivered to Pavia's counsel.
7 This denial is without prejudice to Couri's ability to oppose the contempt motion based on evidence regarding his financial circumstances.