NYC v. Baldeo

DECISION AND ORDER Motion Sequence Numbers 001, 002, 003, and 004 are hereby consolidated for disposition.In this action to abate a public nuisance, plaintiff the City of New York (“City”) seeks, inter alia, to enjoin defendants Dr. Philip Baldeo (“Baldeo”), Miguel Guzman (“Guzman”), and 156 West 15th Street Chelsea LLC (“156 West”) (collectively, “defendants”) from renting the building located at 156 West 15th Street, New York, New York (“Premises”), or any apartment therein, to tourists or other transient tenants in violation of several New York Administrative Code, Building Code, and Multiple Dwelling Law provisions.In Motion Sequence Number 001, the City moves, by order to show cause, pursuant to New York State Multiple Dwelling Law (“MDL”) Section 306, CPLR 6301 and 6311, and Sections 7-707, 20-703(d), 27-2122, and 28-205.1 of the Administrative Code of the City of New York (“Administrative Code” or “Admin. Code”) for a preliminary injunction enjoining defendants from (1) interfering with the City’s right to have immediate and unhindered access for its Fire Department of New York (“FDNY”) Fire Protection Inspectors and Department of Buildings (“DOB”) Inspectors, including but not limited to those personnel assigned to the Mayor’s Office of Special Enforcement (“OSE”), to lawfully enter the Premises, in their normal course of duty, for the purpose of inspecting the Premises and any parts thereof, and any signs or service equipment contained therein or attached thereto, at all reasonable times, pursuant to relevant and applicable regulations and unobstructed by defendants to determine the Premises’ compliance with the provisions of the New York City Building Code (“Building Code”), the New York City Fire Code, as well as all other relevant provisions of the Administrative Code, the MDL, and other applicable laws and rules; (2) using or occupying, or permitting the use or occupancy of any residential units in the Premises for transient use and occupancy and/or as transient hotel rooms, hostels, or apartment hotels, except those units currently so occupied, which must be vacated within twenty-four (24) hours of issuance of this Court’s order, unless otherwise directed by any subsequently issued DOB order to vacate the Premises sooner, and from further permitting the use or occupancy of such currently occupied units for transient use and/or as transient hotel rooms, hostels, or apartment hotels immediately after the current occupants leave; (3) permitting the use or occupancy of any additional residential units at the Premises or in any other Class “A” dwelling units in all other buildings in the City of New York for transient occupancy or use and/or as transient hotel rooms, hostels, or apartment hotels; (4) registering any new persons at the Premises or in any other Class “A” dwelling unit in all other buildings in the City of New York for transient short-term occupancy of less than a thirty (30) day stay; (5) booking or advertising any units at the Premises or in any other Class “A” dwelling unit in all other buildings in the City of New York for short-term transient use, either on their own internet sites or on other travel-related internet sites not directly operated by the defendants; and (6) disposing of, modifying, or in any other manner interfering with or altering the digital or paper documents, photographs, and records maintained and used in connection with the management, operation, use, and occupancy of the Premises.¹In Motion Sequence Numbers 002, 003 and 004, defendants Baldeo, 156 West, and the in rem Premises (collectively, “moving defendants”) move to dismiss the complaint as against them (however, moving defendants do not set forth the provision(s) of the CPLR upon which they rely for dismissal).²The complaint sets forth eight causes of action for the abatement of statutory and common law public nuisances premised upon violations of building codes related to the illegal conversion of the Premises from residential to transient use (Admin. Code §28-210.3), multiple causes of action for illegal occupancy (Admin. Code §28-118.3.1-4), unlawful change of use or occupancy and work without a permit (Admin. Code §28-105.1), failure to maintain the Premises in a safe condition in compliance with building codes (Admin. Code §28-301.1), criminal nuisance (New York State Penal Law §240.45(1)), violations of MDL §4.8(a) (prohibiting the use of a Class “A” multiple dwelling for any purpose other than that of a permanent residence), and a single cause of action for deceptive trade practices (New York City Consumer Protection Law (“NYCCPL”), located at Admin. Code §20-700).BACKGROUNDAccording to the unrefuted facts as alleged in the complaint, the Premises is a four-story walk-up Class “A” multiple dwelling containing nine Class “A” apartments and one Class “B” sleeping room.³ Defendant Baldeo, through 156 West, owns and manages the Premises, which he initially purchased in 2013. Defendant Guzman is a tenant of the Premises. Guzman has advertised apartments within the Premises for use on the website Airbnb (www.airbnb.com).⁴The City asserts that the use of a Class “A” apartment for transient stays of less than thirty (30) days is prohibited by the MDL and by the Administrative Code as an illegal conversion, an illegal occupancy, and an unsafe condition due to increased fire safety risks and other public health issues. These risks arise because, inter alia, transient occupants of Class “A” apartments are not provided with sufficient fire safety protections-including fire suppression devices, alarms, and emergency lighting-which would be required in transient dwellings (e.g., hotels). According to the City, the lack of adequate fire safety, combined with the transient tenants’ unfamiliarity with the Premises, significantly increases the risk of injury to individuals in the event of a fire.The complaint also alleges that apartments in the Premises are regularly and deceptively advertised on Airbnb for short term stays-as short as one day-in violation of the MDL and the NYCCPL. The City provides several of these advertisements, which state, for example, that the “entire apartment” is available for “$243 per night,” that there is a “1 night minimum stay,” and that “[c]heck in is anytime after 3PM [and] check out by 12PM.” Pugach Aff., Ex. 17.The City contends that since at least August 2014, multiple units in the Premises have been rented on a regular basis to tourists and other transient visitors for short-term stays of less than thirty (30) days. Specifically, in 2014, the City received complaints of transient use, loud noise and drug use at the Premises. In response, OSE, an investigation unit that observes, inter alia, health, safety and fire code compliance in buildings throughout New York City, inspected the Premises on four separate occasions between 2014 and 2017.⁵ These investigations determined that several units in the Premises were repeatedly occupied by transient tenants and that the Premises did not contain sufficient fire safety protection for such use.⁶ Specifically, at the time of one investigation, six units in the Premises (Apartments 1A, 1D, 2B, 2C, 3A, and 4A) were found to house transient occupants-namely, tourists. Pugash Aff.,

32-36. Based upon its investigations, OSE issued twelve (12) New York City Environmental Control Board (“ECB”) notices of violations (“NOVs”), including several NOVs for illegal transient occupancy (i.e., the illegal renting of units on a day-to-day basis) and for the illegal conversion of a residential property to, effectively, a commercial property. Id., Ex. 7-10, 12, 14-15. In addition to the twelve (12) NOVs, one summons was issued to Guzman for advertising transient occupancies on Airbnb. Id., Ex. 19. Finally, it is noted that this alleged illegal conduct is taking place in apartments that, within the past decade, were designated as rent stabilized residencies. Now, rather than providing affordable housing, the entire building was emptied of permanent residents and instead used for short-term rentals via websites such as Airbnb.DISCUSSIONThe Preliminary Injunction (Mot. Seq. No. 001)The City essentially requests two primary injunctions: (1) to enjoin defendants from the illegal use or occupancy of the Premises and (2) to enjoin defendants from advertising what would be an illegal use or occupancy of the Premises. Typically, “[a] party seeking a preliminary injunction must demonstrate, by clear and convincing evidence (1) a likelihood of success on the merits, (2) irreparable injury absent the granting of the preliminary injunction and (3) a balancing of the equities in the movant’s favor.” Gilliland v. Acquafredda Enters., LLC, 92 A.D. 3d 19, 24 (1st Dep’t 2011). However, recognizing the public’s compelling interest in ensuring that building and fire safety codes are followed, where a municipality seeks injunctive relief in nuisance abatement proceedings, such as in this action, “[t]he three-pronged test for injunctive relief does not apply; no special damage or injury to the public need be alleged; and commission of the prohibited act is sufficient to sustain the injunction.” City of New York v. Bilynn Realty Corp., 118 A.D.2d 511, 512 (1st Dep’t 1986). Here, under either the three-prong test discussed in Acquafredda Enterprises, LLC (92 A.D.3d at 24), or the single prong test set forth in Bilynn (118 A.D.2d at 512), the City has met its prima facie entitlement to a preliminary injunction.Pursuant to MDL Section 4.8(a), the units within the Premises, which is a Class “A” multiple dwelling, “shall only be used for permanent residence purposes,” which is defined as “occupancy of a dwelling unit by the same natural person or family for thirty consecutive days or more.”⁷ Pursuant to MDL Section 306, the City may seek to enjoin any violation of the MDL, including the improper use of a Class “A” multiple dwelling. Further, MDL Section 304 establishes that both the violator and “every person who shall… assist in the violation of any provision of [the MDL]” are punishable under the statute.MDL Section 4.8(a) is incorporated into both the Administrative Code and the Building Code.⁸ Pursuant to Administrative Code Section 7-703(d), which contains the “Nuisance Abatement Law,” a building such as the Premises shall be a public nuisance if it is in violation of, inter alia, Administrative Code Sections 28-210.3, 28-118.3.2, 28-105.1, and 28.301.1. Administrative Code Section 28-210.3 governs illegal conversion of buildings from residential use to transient use, such as the Premises. It sets forth, in pertinent part, the following:It shall be unlawful for any person or entity who owns or occupies a multiple dwelling or dwelling unit classified for permanent residence purposes to offer or permit the use or occupancy or to convert for use or occupancy such [dwelling or unit] for purposes other than permanent residence purposes. For the purposes of this section a conversion in use… may occur irrespective of whether any physical changes have been made to such dwelling unit.Admin. Code §28-210.3. Administrative Code Section 28-118.3.2 provides that “[n]o change shall be made to a building… inconsistent with the last issued certificate of occupancy.” Administrative Code Section 28-105.1 provides that “[i]t shall be unlawful to… change the use or occupancy of any building… unless and until a written permit therefore shall have been issued by the commissioner in accordance with the requirements of this code.” Administrative Code Section 28-301.1 provides, in pertinent part, that a building’s owner “shall be responsible at all times to maintain the building and its facilities and all other structures regulated by this code in a safe and code-complaint manner.” Pursuant to Administrative Code Section 7-704, the City may seek an injunction enjoining acts, including the foregoing acts, that constitute a public nuisance.The City alleges that defendants violated and continue to violate MDL Section 4.8(a) and the aforementioned Administrative Code provisions by permitting the use or occupancy of the Premises, or by converting the same for the purpose of use or occupancy, as short-term transient tenancies of less than thirty (30) days. The City argues that these violations create an unsafe condition in the Premises because Class “A” multiple dwellings are not equipped with fire safety devices and other protections that are statutorily required of buildings registered for the purpose of transient occupancy, such as hotels, which, in turn, leads to an increased potential for injury to transient tenants who are unfamiliar with the layout of the building. Hendrix Aff., Ex. 2; Spadafora Aff.,