R&E’s Award-Winning Attorneys

Appellate Panel Finds Brooklyn Court Wrongly Dismissed Landlord’s Petition Relating To A Newly Created Duplex Apartment

Featuring Jeffrey Turkel November 9, 2021

Rosenberg & Estis, P.C. has prevailed before the Appellate Term, Second Department of New York State Supreme Court, arguing that Housing Court wrongly dismissed a landlord’s non-payment petition.

Jeffrey Turkel, a member of Rosenberg & Estis, argued the case, 222 Stanhope II, LLC v. Chris Bagamery, on behalf of the petitioner-appellant, which owns and rents out the three-story, six-unit apartment building at 222 Stanhope St. in Bushwick, Brooklyn.

Justices David Elliot, Michelle Weston and DonnaMarie Golia unanimously reversed a King’s County Housing Court judge’s order and reinstated the landlord’s petition against Bagamery, the tenantrespondent. The justices remitted the case to Brooklyn Housing Court for a new trial.

The case centers on the trial court’s June 2019 amended order dismissing the property owner’s attempt to recoup $51,466 in back rent in a summary nonpayment proceeding initiated by the landlord in 2016. That ruling stemmed from a June 2018 decision by Judge Kevin McClanahan, who rejected the landlord’s argument that the duplex apartment in question was not rent stabilized. units into duplex apartments. The property owner finished the building’s cellar for recreational uses, divided it in half, added a half-bath to each side and connected each of the two first-floor apartments to the finished cellar space via individual private stairways.

The landlord contends that 1R became exempt from rent stabilization because the improvements created an apartment that did not previously exist. Because the duplex’s initial rent was $3,000 – higher than the thenderegulation threshold – the apartment was no longer stabilized.

For its part, the Appellate Court reversed the Housing Court for holding that, as a matter of law, the addition of a finished cellar space and a half-bath to a first-floor railroad flat could never create a new apartment under the state Division of Housing and Community Renewal policy. The landlord argued that its substantial altering of the apartment floor plan’s outer perimeter walls fit DHCR’s criteria to lift rent constraints.

The Appellate Term held that because the landlord established at trial its prima facie case that the duplex apartment had been newly created, and the tenant initially leased it at a rent above the deregulatory threshold, the landlord had accurately described the duplex as exempt from rent stabilization in its nonpayment petition.

“The Appellate Court found that the Housing Court demonstrably erred in failing to fairly consider the property owner’s case on its merits,” Turkel said. “Long-standing state policy permits, clear case law defines and ample evidence supports the landlord’s case to charge a new deregulated, market-rate rent for an apartment that is converted into a duplex by the addition of finished cellar space. Rosenberg & Estis is proud of its track record staunchly defending property owners’ rights.”

Second Circuit Court Guaranty Law Challenge – Rosenberg & Estis, P.C. Amicus Brief Arguments Embraced By Appeals Court Judges

Featuring Jeffrey Turkel November 9, 2021

Rosenberg & Estis, P.C. hailed a new decision by the Second U.S. Circuit Court of Appeals in Manhattan that ordered a district court judge to reconsider the constitutionality of a New York City law releasing commercial lease guarantors from rent obligations during the pandemic.

Jeffrey Turkel, a member of Rosenberg & Estis, crafted an amicus curiae brief supporting the landlords, who were the plaintiffs/appellants in the case, Melendez et al. v. City of New York et al.

Turkel wrote the brief on behalf of the Rent Stabilization Association of N.Y.C. Inc. and the Community Housing Improvement Program. In a split decision, Judges Reena Raggi and José Cabranes ruled the district court should reexamine the landlords’ contention that the City’s 2020 Guaranty Law violates constitutional protections against government interference with private contracts.

The Second Circuit remanded the case to U.S. District Judge Ronnie Abrams, who originally upheld the Guaranty Law’s constitutionality in November 2020. Judges Raggi and Cabranes found that the landlords had raised “serious concerns” that the City’s legislation is not “reasonable and appropriate.” Guaranty Law without investigating its necessity or how it functioned, including who it helped and harmed,” Turkel said. “The Second Circuit rightly found that the District Court gave very short shrift to the landlords’ valid arguments regarding the law’s many serious issues, including its devastating and permanent overreach.”

The underlying case dates to July 2020, when a group of landlords and their affiliates sued the City, Mayor Bill de Blasio and other city officials in U.S. District Court for the Southern District of New York.

Signed by Mayor de Blasio in May 2020, the Guaranty Law aimed to promote the public good by mitigating the financial challenges faced by commercial tenants and their guarantors due to the pandemic.

The legislation covered (1) tenants that were required to stop serving food or beverages on their premises; (2) retailers subject to closure and in-person restrictions; and (3) those forced to cease operations entirely, including gyms, movie theaters and personal care businesses like barbershops.

Turkel’s amicus brief argued the City’s law was a drastic overreach because it completely absolved commercial guarantors from rent payments for the period between March 7, 2020 and June 30, 2021,