Court Opinion

ID: 5707536
Source: CourtListenerOpinion
Date Created: 2022-01-12 15:49:18.348914+00
Date Added: 2024-06-11T08:40:27.084380
License: Public Domain

Y ALENTE, J.
(dissenting). By chapter 417 of .the Laws of 1952, subdivision (a) of section 2 of the Business Rent Law was amended to define as “ Business space ”, a building, in which, after March 1, 1952 “ at least sixty per centum of the total rentable area and sixty per centum of the total number of units formerly used as dwelling space, is lawfully occupied as business space on such date”. The owner of premises 200 West 57th Street, alleging that after March, 1952, at least 60% of the total rentable area and 60% of the total number of units formerly used as dwelling space had become, and was now, lawfully occupied as business space, brought this proceeding to fix an emergency rent pursuant to subdivision (c) of section 2 of the Business Rent Law. The petition was sustained as a pleading in Matter of Sipal Realty Corp. (Dankers) (5 A D 2d 84, affd. 4 N Y 2d 1026).
*359This court now reverses an order, after a trial fixing the emergency rent, on the ground that the petitioner failed to prove that 60% of the premises is “ lawfully ” occupied as business space, even though, as the Per Curiam opinion states, ‘1 There is no dispute that 60% of the units in the building are presently used as business space ”. The asserted lack of “ lawful ” occupancy is predicated on the failure of the owner to obtain an order of exemption from the Bent Administrator, pursuant to section 13 of the State Bent and Eviction Begulations, for 15 units which were converted to business use after May 1, 1955, (the effective date of section 13).
I must dissent. Since admittedly the character of the premises has been changed from residential to business, section 13 is wholly inapplicable. (See Matter of 114 East 40th Corp. v. Armstrong, 14 Misc 2d 984.)
Section 13 by its terms refers to ‘ ‘ any housing accommodation * * * which may be rented * * * for commercial or professional use ”. The State Besidential Bent Law (§ 2, subd. 2; L. 1946, ch. 274, as amd.) defines “ housing accommodations ” as 6 4 Any building or structure, permanent or temporary, or any part thereof, occupied or intended to be occupied by one or more individuals as a residence, home, sleeping place, boarding house, lodging house or hotel”. The same definition appears in section 2 of the State Bent and Eviction Begulations. Clearly the 15 units in question — from which, before they were rented for business purposes, all kitchen equipment was removed, and which were physically altered pursuant to plans filed with the Building Department so as to adapt them for such business use —had lost their character as “housing accommodations”. Hence, there was no rental of them as “housing accommodations ” for commercial or professional use. These were units which were proven to have been converted to be used exclusively for business purposes and not in any sense for residential use.
The language of section 13 merely limits the amount of rent a landlord may collect, i.e., he may not collect any sum in excess of the maximum residential rent until the Administrator has issued an -order exempting housing accommodations from the regulations. There is nothing in the section which makes the occupancy by a business tenant unlawful. Moreover, in this proceeding it is not the tenants of the converted space nor the Bent Administrator who are invoking the sanctions of section 13, but tenants of residential space who are not encompassed within the letter or purpose of the regulation. Were section 13 in any way material, it would not lie within the power of appel*360lants to urge its applicability. Hence, the court is not only misapplying the section but doing so on behalf of persons obviously not intended as beneficiaries of its terms.
Any doubt as to the inapplicability of section 13 to the instant proceeding should be dispelled by an examination of the statement of the State Housing Bent Commission of the considerations for the adoption of that regulation. (The note of the commission appears as an annotation following section 13 of the regulation in McKinney’s Cons. Laws of N. Y.) The commission states that the amendment was “ directed against unscrupulous landlords who use two devices to evade rent ceilings. The first is the device of compelling a tenant to sign a lease for a commercial apartment when actually it is to be used only for residential purposes ”. This was to be “ controlled more effectively by requiring the written approval of the Commission prior to any renting of a residential apartment for allegedly professional or commercial usage ”. The second evasion, not pertinent here, deals with the rental of unfurnished apartments as furnished ones. The emphasis is obviously upon the protection of tenants of 1 ‘ residential ’ ’ apartments from overreaching by landlords who would resort to a purported commercial use as a subterfuge for charging a higher rent. Further, to emphasize the purely monetary aspects of the regulations, the commission adds: “ A landlord who fails to obtain this written approval will automatically become liable to a treble damage action by the tenant whom he attempts to overcharge through the device of a commercial or professional lease. ’ ’
The court, while asserting that on the undisputed proof in this record the landlords would probably be entitled to an order of “ exemption ” from the Administrator, nevertheless, states that “ such a showing must first be made to the Administrator, in his threshhold jurisdiction, before proof of conversion may be presented collaterally in another proceeding.” This equates the pleading of compliance with 'section 13 with a condition precedent to the maintenance of the instant proceeding. I cannot reconcile such a result with our sustaining of the petition in Matter of Sipal Realty Corp. [Dankers] (5 A D 2d 84, affd. 4 N Y 2d 1026). If what the court now holds is valid, the petition should have then been dismissed, rather than sustained, by this court. While I was one of the two dissenting Justices in the prior appeal, I think that in sustaining the validity of the petition, the court implicitly negatived the controlling effect now given to section 13, even though the point was not directly raised.
I would therefore affirm the order below.
*361Botein, P. J., Breitel, M. M. Frank and Stevens, JJ., concur in Per Curiam opinion; Valente, J., dissents and votes to affirm, in opinon.
Order granting petitioner’s application for a determination of rent reversed, on the law, and the petition dismissed, without costs to any party.
Settle order on notice.