Thursday December 30, 2004
Rule on Notice To Tenants Has Mixed Results, by Mark Fass

An Attempt by the Court of Appeals to clarify statutory ambiguity in New York’s landlord-tenant regulations has resulted in confusion in the state’s lower courts.

Six months after New York’s highest courts held in ATM One v. Landaverde, 3 NY3d 472, that building owners serving notices to cure by mail must add five days to the 10-day minimum cure period, lower courts have been unable to form a consensus as to whether the rule applies to other landlord-tenant notices.

Judge Jean Schneider applied Landaverde in Lynch v. Dirks, 54774/04.

But Judges Kevin C. McClanahan and Lydia C. Lai ruled against extending it in, respectively, K.S.L.M. Columbus Apartments Inc. v. Bonnemere, 88298/04, and Gnann v. Crawford, 75194/04.

In all three cases, the landlord mailed a Golub notice to a tenant between 90 and 95 days before the lease for the tenant’s rent-stabilized apartment expired, informing the tenant that the lease would not be renewed.

Such notices must provide at least 90 days’ and no more than 150 days’ notice before the expiration of the tenant’s lease. On the face of the law, all three landlords satisfied the condition.

The three tenants, however, filed suits, contending that the Landaverde five-day rule applied. They argued that, under Landaverde, a Golub notice must be mailed between 95 and 155 days before the expiration of a tenant’s lease.

In Landaverde, a landlord mailed a “Notice of Default; 10 Days’ Notice To Cure; 30 Days’ Notice of Cancellation” on Sept. 8, 2000, exactly 10 days before the expiration of the lease. (NYLJ, June 4)

The Landaverde Court said it was undisputed that the tenant received the notice on Sept. 9, 2000, “thus affording her only nine days to cure.” After the expiration of the 30-day period, the owner petitioned to cancel the lease; the tenant moved to dismiss the petition on the grounds that she received insufficient notice.

Dismissal Upheld

In upholding the district court’s dismissal of the landlord’s petition, Judge Victoria A. Graffeo wrote, “The regulation that purports to answer the question of when service of a notice is complete does not actually do so.”

Reading both the service provision and the notice to cure regulation, Judge Graffeo said, “we conclude that the District Court’s approach best effectuates the regulatory purpose to afford tenants a 10-day cure period before they may be subject to the 10-day cure minimum cure period.”

In extending the Landaverde decision in Lynch v. Dirks to a Golub notice, Judge Schneider looked at, among other things, the Court of Appeals’ discussion of the regulatory silence regarding completion of notice.

“The regulatory scheme in this case, like the one in Landaverde, does not say when service of a notice is complete, and petitioner has suggested no persuasive reason why I should not hold that service under a virtually identical regulation, where the legislative and regulatory purpose is the same, should not be deemed to be complete at the same time and in the same fashion,” wrote Judge Schneider.

Need for Action

In the cases that declined to extend the rule, the judges primarily looked at the tenant’s need, or lack of it, to take action upon receiving the notice.

“The notice to cure demands that the tenant take affirmative steps to cure the lease violation upon pain of the premature termination of the lease term,” wrote Judge McClanahan in K.S.L.M. Columbus Apartments Inc. v. Bonnemere. “Unlike both the notice to cure and notice of termination, the Golub Notice does not contemplate or require any affirmative steps by the tenant. Any action taken by the tenant immediate or otherwise will not negate the landlord’s intent not to renew the lease.”

Judges McClanahan and Lai also cited the differing minimum lengths of the notice periods required by notice to cure and Golub notices, 10 and 90 days respectively.

“Generally, cure periods are of short duration. Given the import of the notice to cure, it is not unreasonable that a landlord add the extra five days to ensure that the tenant enjoys the benefit of the full cure period,” wrote Judge McClanahan. “The same equitable considerations do not pertain to the Golub notice.”

Meanwhile, attorneys and judges are exploring whether the rule can or should be extended to other types of notices or other manners of service.

Contrary to the outcome in Gnann v. Crawford, Judge Lai did apply Landaverde to a seven-day termination notice in Kerrin Reality Corp. v. Cruz, 81894/03.

Judge Gerald Lebovits extended the five-day rule to a notice to cure served by a Mitchell-Lama housing cooperative, in Southbridge Towers, Inc. v. Frymer, 781 NYS 2d 207.

“The way I read Landaverde, I think, whether we like it or not, it would apply to any leasehold notice that is served by mail,” said Deborah Riegel, who along with Michael Pensabene, both of Rosenberg & Estis, represented the victorious landlord in K.S.L.M.

Wider Application?

Notices served via substituted or conspicuous place service, both of which also require mailed service, would therefore be subject to Landaverde as well.

“I would thing that somebody, if they haven’t already, will argue that you have to add five days” in those cases, said Ms. Riegel.

The decision in the Golub cases appear ripe for appeal, said Samuel J. Himmelstein, whose firm Himmelstein McConnell Gribben & Joseph LLP represented the tenant in both K.S.L.M. and Lynch.

“I think it’s more likely that a landlord’s going to take it up,” he said, “because they’ve got the resources.”

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