178 Broadway Realty Corp. v. Charles

75 Misc.3d 937

172 N.Y.S.3d 323

178 BROADWAY REALTY CORP., Petitioner(s),

v.Nathan CHARLES, Respondent-Tenant, John Doe, Jane Doe, Respondents-Undertenants

L & T Index No. 309793-21/KI

Civil Court, City of New York, Kings County.

Decided on May 23, 2022

Petitioner Attorney: Novick Edelstein & Pomerantz PC

Respondent Attorney: The Legal Aid Society

Kimberley Slade, J.

Petitioner moves to vacate an ERAP stay imposed by Section 8 of the current ERAP law (Chapter 417, Laws of 2021 Part A) in this holdover proceeding where petitioner seeks possession of the subject unregulated premises following service of a 60 Day Notice terminating respondent's tenancy effective August 31, 2021. Respondent retained The Legal Aid Society in December 2021 and shortly thereafter the proceeding was stayed as the Court became aware of a pending ERAP Application (Application Number 0N1YV) and the case was then placed on the ERAP Administrative Calendar pending a determination of Respondent's application. Petitioner then filed the instant motion by order to show cause (OSC) seeking to vacate the stay.

Petitioner challenges the stay provision of Part BB of Chapter 56 of the Laws of 2021, as amended by Part A of Chapter 417 of the Laws of 2021, arguing that it mirrors the previously invalidated automatic stays triggered by the filing of hardship declarations decided in Chrysafis v. Marks, ––– U.S. ––––, 141 S.Ct. 2482, 210 L.Ed.2d 1006 (2021), and that CPLR 2201 grants courts in a civil action inherent power to control their own proceedings and stay or suspend cases in its discretion. The motion is supported by an affidavit from the managing agent of the petitioner-landlord. In the affidavit, the agent swears that even if ERAP is approved, no monies will be accepted and that "no amount of money will make petitioner whole." (See , Affidavit Doc. No. 10 on NYSCEF paragraphs 5 through 7). In general, if a petitioner accepts an ERAP payment it must agree to a twelve month tenancy/occupancy or forego the payment of arrears that ERAP would otherwise have paid in order to continue a proceeding.

In response, respondent argues that petitioner's constitutional challenge to the ERAP stay is not properly before the court because petitioner's OSC did not provide for service on the New York Attorney General's Office. Instead, it appears that petitioner served the AG's Office with a copy of the OSC on a later date and once more after this Court issued an interim order on a similar case presently before this Court presenting the same issue and being litigated by the same attorneys. That order directed an additional form of service without determining that it was either necessary or required. As the Court does not see any prejudice to when and how a copy of the OSC was served on the AG's Office and no one from the AG's Office has appeared in any event, the matter will be decided on its merits. As discussed below, the matter is decided upon other grounds, so the constitutional questions raised by Petitioner are not addressed.

Respondent argues that nothing in CPLR 2201 grants this court the authority to vacate the statutory stay that is triggered with the filing of an ERAP application and that the ERAP statute itself does not provide for the vacatur of its stay. However, respondent does partially concede that under "certain circumstances" the court has power to modify or vacate its own orders. In addition to arguing that the Court may not vacate the ERAP stay for this reason respondent further argues that ERAP helps landlords by enabling them to receive funds which in turn helps tenants avoid eviction and thus the stay must remain intact. While this position is unarguably true in most if not all instances where the parties are already in privity and arrears are the source of the claim, it is less true and fails to account for the variety of situations that arise in the context of holdover proceedings where not every petitioner and respondent desires a tenancy, where rent is neither owed nor claimed (as distinct from use and occupancy) and where that the payment of ERAP funds will not further the goal of preserving tenancies.

This argument further fails to provide a rationale for continuing a stay where the goal of protecting or creating tenancies cannot or will not be accomplished, as occurs in many instances. Noteworthily, again, the stay applies to occupants and respondents, not only to tenants, where there may be an approved application for ERAP funds but where the petitioner or landlord may elect not to participate in the ERAP program and thus, the goal of preserving tenancies will not be accomplished and the case will idly languish stayed for no beneficial purpose. Consequently, the ERAP stay is only fairly or rationally continued or maintained where a tenancy is the desired outcome of both sides or where the law may or will impose a tenancy on a landlord such as where a prima facie showing of succession by a licensee has been articulated.

Where a landlord or owner of a non-regulated tenancy elects not to participate, agrees to forego the ERAP monies where required, articulates this in an appropriate context and moves to vacate the stay its blanket continuance will overly prejudice a landlord or owner while providing a tenant, occupant or applicant with a stay that does not further the legislative or policy goals of ERAP, has no individual merit and serves no end other than to prolong a...