Court Opinion

ID: 5924723
Source: CourtListenerOpinion
Date Created: 2022-01-13 04:43:38.954133+00
Date Added: 2024-06-11T08:46:32.974734
License: Public Domain

Smith, J.,
dissents in a memorandum as follows: I believe *164that a hearing should be held on the petition to annul respondent’s determination terminating petitioner’s participation in the Tenant Interim Lease (TIL) Program. I would, therefore, remand the matter back to the IAS court for a hearing.
In a letter dated May 4, 1988 from Susan Redes, Director of the Tenant Interim Lease Program, to Ms. Ola Williams, a tenant in the building, petitioner was terminated from the TIL Program because of "problems” in the building. The letter states that the "majority of these problems involve discrepancies in the fiscal management of the building”. However, neither the record nor oral argument revealed any evidence of missing or unaccounted-for funds or other specific improprieties by petitioner supporting its termination from the program.
The members of petitioner 151 West 140th Street Tenant Association (the Association) are occupants of the subject apartment building which is owned by the City of New York and administered by respondent Department of Housing Preservation and Development (HPD). Respondents established the TIL Program to afford tenants living in city-owned buildings an opportunity to manage the buildings in which they live and to eventually purchase and operate such buildings as not-for-profit residential cooperatives. As an initial step in the program, tenant associations, under an 11-month interim lease from the city, maintain and operate the building and gain management experience.
The record before us consists entirely of affidavits of the parties’ representatives and of their counsel, and of correspondence between the Association and HPD.
This record indicates that petitioner executed its first lease with HPD in August 1979 and successive leases were renewed through October 31, 1987. By a form letter dated September 16, 1987, HPD advised petitioner’s president, Ms. Charlie Mae Jones, of the upcoming renewal, requested certain documents, and scheduled an appointment with an HPD employee. Respondents allege, and petitioner does not dispute, that the appointment was not kept.
Respondents allege that an audit of petitioner’s practices, conducted by HPD in December 1987, revealed, inter alia, that petitioner’s bank account was overdrawn by $9,792.29, that "large management fees were being taken by the sub-manager” without documentation to HPD, that "rent arrears were being written-off as uncollectable without prior written approval” from HPD, that there were "unaccounted for *165changes in the rent arrears” and that petitioner was "chronically late” in its submission of reports.
Respondents further allege that on January 15, 1988 the Director of the TIL Program met with representatives of the Association to discuss the audit results. A letter to Ms. Jones dated January 21, 1988 purports to summarize that discussion. Respondents further allege that on January 21, 1988 HPD representatives met with the tenants and imposed the following two conditions under which the Association could remain in the TIL Program: (1) the Association was to be responsible for total management of the building within TIL guidelines and (2) Ms. Williams was no longer to be involved in such management. The tenants, by letter of January 25, 1988, expressed their desire to maintain Ms. Williams as manager but without authority to draw checks, and by letter of February 2, 1988, HPD agreed.
Thereafter, in a letter dated March 7, 1988, HPD again complained to the Association of untimely monthly reports and that bank deposit slips and court stipulations for repairs had not been submitted to HPD. Moreover, respondents in their answer assert that after March 28, 1988 no rent moneys were deposited into the Association account for which respondents then held a checkbook and that petitioner was thereby withholding city funds.
On April 14, 1988 another meeting was held at the petitioner’s request. Respondents maintain that at this meeting deadlines were set for the submission of certain documents and that these deadlines were confirmed by its letter of April 19, 1988 to petitioner. Respondents allege that in response to its April 14 request, the Association submitted the same documents which had been provided to HPD on January 15, 1988, with six requested documents again omitted. Thereafter, by letter of May 4, 1988, HPD advised the tenants that the Association had been terminated from the program.
Respondents contend that despite nine years in the program, the Association never developed sufficient cohesion or competence to proceed to cooperative formation, and that it was the Association’s recalcitrance which caused HPD to conclude that valuable resources were being wasted by its continued participation in the program.
Petitioner, on the other hand, claims that since 1979, it has always made good-faith efforts to comply with HPD requirements, and that its recent failings, if any, were the result of HPD’s failure to provide the Association with requested assis*166tance and support. Petitioner alleges that at the April 14, 1988 meeting, HPD representatives agreed to provide the Association with a letter outlining deadlines for remedy of perceived noncompliance, but that the April 19 letter, which was mailed on April 22 and received by petitioner on April 28, 1988, included deadlines which had already passed. The Association alleges that it had previously complied with directive number 1 of the letter regarding assumption by the Association of management responsibilities. It alleges that as to directive number 4, it delivered the lease renewal documents to respondents on April 29, 1988. As to numbers 2 and 3, which required that the Association define management tasks and turn over bank deposit slips, rent receipts and other financial records to HPD, it asserts that upon receipt of the request, the imposed deadline had passed.
Petitioner subsequently requested an extension of time to comply with HPD’s demands. The Association protested the HPD action in a letter dated May 23, 1988. In this letter Ms. Jones, on behalf of the Association, states that HPD failed to advise them of the alleged discrepancies in their fiscal management of the building. She acknowledges overdrawing the bank account but states that the bank extended overdraft privileges to the Association in order to allow it to pay for emergency repairs, including repairing the elevator. This, according to Ms. Jones, had been explained to HPD representatives at every meeting. She states that HPD’s refusal to provide legal assistance, as well as necessary documents, has prevented the Association from commencing holdover proceedings against tenants with rent arrears and that, as a result, the rents collected were inadequate to maintain the building.
The law is well settled that a court may not interfere with the exercise of discretion by an administrative tribunal unless there is no rational basis for the determination or the action complained of is arbitrary and capricious. (Matter of Pell v Board of Educ., 34 NY2d 222, 230-231 [1974].)
Here, HPD’s refusal to grant petitioner an extension of time in order to produce documents and information requested in its April 19, 1988 letter appears to be arbitrary and capricious. This is especially so in view of the absence of any evidence in the record, short of bald assertions, of misappropriation of funds or other improprieties in the conduct of petitioner or its submanager.