The case of A* J* Realty Co., L.P. v. P* revolves around a holdover summary proceeding in which the landlord sought possession of an apartment, arguing that it was no longer subject to rent stabilization. The tenant, SP, counterclaimed for rent overcharges and alleged that the deregulation of her apartment was fraudulent since no renovations had ever been made to the unit.
At trial, the landlord's property manager testified that the apartment was legally deregulated in 2005 due to the application of vacancy and longevity rent increases, which brought the rent above the $2,000 luxury deregulation threshold that was in effect at the time. The tenant, appearing pro se, argued that she was overpaying for rent, comparing her apartment to similarly sized renovated units with lower rents. She further claimed that the landlord had fraudulently deregulated her unit without making the required renovations.
The Civil Court ruled in the landlord's favor, awarding possession of the unit and implicitly dismissing the tenant's counterclaim. On appeal, the tenant raised additional arguments, including improper service of notice and petition and the failure to receive a 90-day non-renewal notice. However, the appellate court determined that these arguments had been waived, as the tenant had not raised them in her answer or through a pre-trial motion.
Regarding the core issue of deregulation, the appellate court emphasized that the burden was on the landlord to prove that the apartment was legally deregulated. Evidence presented at trial supported the landlord's position: vacancy and longevity rent increases had lawfully raised the rent above the threshold for deregulation, and there was no requirement that the rent increase be based on renovations. As a result, the appellate court affirmed the lower court's decision, concluding that the landlord had properly deregulated the apartment and dismissing the tenant’s claims of fraud and overcharges.
In summary, the ruling reinforces that legal deregulation can occur through rent increases alone, without the necessity of apartment improvements. The case also highlights the importance of tenants raising procedural objections at the appropriate time, as failure to do so may result in waiver on appeal.
(Think the landlord threw in some fresh paint?)
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DECISION