As summer winds down, I thought the best way to ease into autumn would be to examine certain jurisdictional and proof issues that pop up over and over again in summary proceedings. Thankfully, the Courts have provided relevant decisions worthy of discussion. The first is from Nassau County District Court Judge Scott Fairgrieve which discusses whether a commercial landlord waived the right to commence a summary proceeding seeking to collect significant additional rent when the landlord accepted base rent payments 1. The second case is from the New York City Civil Court and involves an amendment of a petition to conform to trial proof and whether additional rent demands are needed before the motion will be granted 2. The last case is a brief decision from the Appellate Division, Second Department, which discusses the adequacy of proof adduced at the trial of an unlawful eviction claim 3.
In Ambrogio & Caterina Giannone Family Ltd. Partnership, petitioner commenced a commercial non-payment proceeding seeking $1,205.10, in base rent and $79,396.72, in additional rent for construction costs. Respondent moved to dismiss alleging that petitioner accepted thirteen base rent payments since the construction was completed, seven base rent payments since the additional rent was billed and three base rent payments since the rent demand was served. Petitioner alleged “[f]rom the time the construction work began through to when the costs were billed to the tenants in August 2011, when a formal rent demand was served in December 2011, and when a nonpayment proceeding commenced in March 2012, I have actively and continuous (sic) discussed, with respondent, its obligation to pay for these costs under the lease.”
After initially confirming that laches is not a viable defense in commercial cases, the Court framed the issue presented as whether “petitioner waived its right to commence this summary proceeding” by accepting base rent payments. The Court noted that respondent did not dispute that petitioner “continuously attempted to collect the additional rent owed . . . ” The Court noted that the lease at issue contained a “no waiver clause” providing that “no waiver of any provision of this lease shall be effective unless in writing, signed by the waiving party.” The Court denied the motion to dismiss holding that these facts combined with the “no waiver provision clause” led to the conclusion that “[t]here is no basis to find that petitioner waived its right to recover additional rent in a summary proceeding by its acceptance of basic rent. To hold otherwise would frustrate the reasonable expectations of the parties embodied in their lease.”
In JDM Washington Street, LLC, after the conclusion of petitioner’s case, petitioner moved to conform its pleading to the proof presented at trial and rested its case. Respondent opposed the motion arguing that “petitioner must make an updated demand for any rent and additional rent that has accrued since the predicate notice before it can seek to amend the petition at trial.” Respondent argued that “petitioner is limited to a claim for the rent sought in the predicate notice because petitioner never demanded any additional rent while this proceeding was pending.”
In granting the motion to amend the petition to conform to the proof adduced at trial, the Court relied on the specific language of RPAPL §711(2) and CPLR §103(b). The Court noted that “RPAPL §711(2) provides for ‘a demand of rent’ — not plural demands for rent. . . The RPAPL makes no provision for an updated demand for rent in a nonpayment proceeding.” In discussing the CPLR, the Court reminds us that “[u]nder the CPLR a motion to amend a pleading at trial must be freely granted absent surprise or prejudice resulting from the delay.” The Court thus found that a tenant could not be surprised that a landlord in a nonpayment proceeding would seek all rent owed up to trial. The Court refused to read into the RPAPL “a requirement that rent demands must be updated before a petitioner may seek to amend its petition to reflect rent allegedly accrued at the time of trial. Such a requirement would graft another element onto a petitioner’s prima facie case.”
Finally, in a case brought by a commercial tenant against its landlord for damages resulting from an unlawful eviction, the Appellate Division, Second Department, reversed a judgment after a nonjury trial in favor of the tenant. The Appellate Division found that the hearsay testimony offered by tenant to establish its damages was insufficient. In awarding judgment in favor of the tenant for $120,000 ($30,000 loss plus treble damages of $90,000) as compensation for equipment lost as the result of a wrongful eviction, the lower court relied on “the hearsay testimony of the plaintiff, as well as the hearsay testimony of another witness that a third party in Georgia offered to purchase the equipment for the sum of $30,000 after the witness described the equipment to that third party during a telephone conversation.” The Appellate Division noted that “Neither the plaintiff nor his witness testified from his own knowledge as to the actual value of the equipment.” In reversing the judgment of the lower court and dismissing the complaint, the Appellate Division found that the testimony regarding damages was “based completely on hearsay, and unsupported by competent proof . . .” This ruling is harsh, but it serves to remind us that care must be taken when preparing all aspects of our cases and that damages will not be awarded unless competent proof is presented, regardless of the culpable conduct of the opposition.