Recitation, as required by C.P.L.R. §2219(a), of the papers considered in the review of these motions.Papers NumberedRespondent’s Notice of Motion & Affidavits Annexed 1Petitioner’s Answering Affidavits 2Respondent’s Replying Affidavits 3DECISION/ORDERUpon the foregoing cited papers, the decision and order on this motion are as follows: This is a holdover summary eviction proceeding wherein Petitioner alleges that the apartment is exempt from rent stabilization by virtue of high rent vacancy deregulation in 2009. After the completion of discovery, Respondent has moved for an order dismissing the petition because the apartment is rent-stabilized and Petitioner has failed to plead a ground for eviction under the Rent Stabilization Code.1 The issue before the court is whether an owner may treat an apartment as exempt from rent stabilization if the apartment would have otherwise been exempt — due to high rent vacancy decontrol — had the owner complied with the requirements of the Rent Stabilization Code, even though it did not.Petitioner has owned the building since 2005. It alleges that soon after it purchased the building it undertook renovations in the apartment totaling $31,923.17, entitling it to an individual apartment increase of $707.40. Between this increase, a longevity increase, and various vacancy increases that it was entitled to, Petitioner claims that by the time Respondent moved into the apartment in 2012 the rent it could have charged exceeded the threshold for high rent vacancy decontrol and therefore the apartment was no longer subject to rent stabilization. While that claim might be straightforward enough, it is complicated by a convoluted history of missing rent registrations, retroactive or late registrations, inaccurate registrations, and lease agreements that do not comport with the registrations.Respondents moved to the apartment in August 2012, pursuant to a one-year lease agreement with a monthly rent of $1,800.00 per month. In July 2013, Petitioner registered the apartment with the Division of Housing and Community Renewal as rent-stabilized, listing the legal regulated rent as $1,800.00. But as of May 2015, as indicated on a DHCR registration history printout from that month, since 1996 the apartment had been registered with DHCR only one other time: in 2005, listing the legal regulated rent as $1,269.00 (for tenant Sara Winslow). For 1997 through 2004, for 2006 through 2012, and for 2014, the apartment was not registered with DHCR.Then, in May 2015, late registrations for the years 2006 through 2012 were filed. For 2006, the apartment was registered as exempt from rent-stabilization due to “high rent vacancy.” For the following seven years, until the 2013 registration in the name of Respondents, the apartment was registered as exempt from rent stabilization.But in October 2016 (after commencement of this proceeding), Petitioner filed another set of registrations for some of the same years for which late registrations were filed in 2015. For 2007 it registered the apartment as rent-stabilized with a legal regulated rent of $1,563.18, listing the tenant as Alexis Bergens. For 2008 it registered the apartment as rent-stabilized with a legal regulated rent of $1,828.92, listing the tenant as Andriy Korsun. For 2009 it registered the apartment as rent-stabilized with a legal regulated rent of $1,883.79, listing the tenant as Elana Korsun (despite the different tenant name, the registration gives the reason for the rent change as a renewal lease, not a vacancy lease). And for 2010 it registered the apartment as exempt from rent stabilization due to “high rent vacancy.”But the leases provided by Petitioner in discovery and annexed to the motion papers do not jibe with the registrations. No lease is provided for the 2007 registration (Alexis Bergens). The Andriy Korsun lease commences May 2007 as set forth in the 2008 registration, but it contains a rent of $1,575.00, not $1828.92 as stated in the registration. The Elana Korsun lease commences May 2008 as set forth in the 2009 registration, but it contains a rent of $1,575.00, not $1,883.79 as stated in the registration. And a lease commencing July 2009, for another group of tenants and with a rent of $1,575.00, is not registered at all.Additionally, despite the rent registrations, each of the leases has a rider stating that the rental amount in the lease is “preferential” and the legal rent for the apartment is $2,000.00The material facts are not in dispute.2 The thrust of Respondents’ argument is that, between the repeated and conflicting retroactive/late registrations with DHCR and registrations that are inconsistent with the leases they are supposedly registering, the apartment was never properly deregulated and remains subject to rent stabilization.3 Petitioner argues, in effect, that the court should largely ignore the registration history and the conflicts between the leases and registrations. Petitioner focuses instead on the raw numbers, purporting to demonstrate that, whatever may have transpired with the leases and registrations, it did not charge the tenants prior to Respondent any more than it would have been legally entitled to charge, and that between the IAI increase, longevity increase, and various vacancy increases it would have been entitled to, by the time it entered into the May 2008 lease with Elana Korsun it was entitled to charge more than $2,000.00. Therefore, Petitioner’s argument goes, since Elana Korsun’s tenancy was unregulated (the registration stating otherwise notwithstanding), Respondent’s tenancy was similar unregulated.Implicit in Petitioner’s argument is its acknowledgment that the apartment was not exempt from rent stabilization in 2006, notwithstanding the 2015 late registration to that effect. It offers scant details, but Petitioner attempts to blame that registration on a receiver that was in place while the building was the subject of a foreclosure action. It does not explain why, since Petitioner acknowledges that the apartment did not become exempt from rent stabilization until 2008 (the registration for that year to the contrary notwithstanding) the 2006 registration has not been amended. Nor does Petitioner explain why, although it is now arguing that the 2008-2009 tenancy of Elana Korsun was not rent-stabilized due to high rent vacancy decontrol, it amended that registration days before commencing this proceeding to state that her tenancy was rent-stabilized (which Petitioner cannot blame on a receiver as the foreclosure action had been terminated about two years earlier, not to mention that Petitioner was represented by counsel in this proceeding at the time).In any event, the court is not persuaded by Petitioner’s argument that compliance with the Rent Stabilization Code, including agreement between the registrations with DHCR and the terms of the leases memorialized in those registrations, is merely ancillary to whether an apartment has properly been deregulated. “Without complying with the proper regulation procedures, petitioner cannot prove that the apartments have been properly deregulated by [the tenants] paying a ‘legally regulated rent’ over $2000.00″ (Tribeca M. Corp. v. Haller, 2003 NY Slip Op 51271[U] [Civ Ct New York County 2011], aff’d 11 Misc 3d 133[A], 2006 NY Slip Op 50444[U] [App Term, 1st Dept 2006]); cf. Matter of 215 W 88th St Holdings LLC v. New York State Div. of Hous. & Community Renewal, 143 AD3d 652 [1st Dept 2016] [DHCR wrong to allow owner to collect rent increases that it could have charged had it only offered proper renewal leases])As the record on summary judgment establishes that the rental history for the apartment is replete with errors, inconsistencies, and gaps, the court finds that the apartment has not been properly deregulated (notwithstanding that it hypothetically could have been) (cf. Stahl York Avenue Co., LLC v. Yang, 59 Misc 3d 131 [A], 2018 NY Slip Op 50431 [U] [App Term, 1st Dept 2018] [record on summary judgment established that rent had not reached deregulation threshold where, among other things, "the DHCR registration rent roll report that was submitted was insufficient, since it indicated that the apartment was 'TE' or temporarily exempt during the relevant period, a classification landlord now claims was erroneous, contained unexplained time gaps, and indicated neither tenant or occupant of the subject apartment, the legal rent, or the amount of rent collected"]).[INTENTIONALLY BLANK]Respondent’s motion is granted insofar as he is awarded summary judgment on his claim that Petitioner failed to plead a ground for eviction under the Rent Stabilization Code as required. The petition is dismissed. Respondent’s counterclaims are severed for a plenary proceeding.Dated: May 30, 2018
