It cannot be debated that making or serving a proper rent demand under RPAPL § 711(2) is a necessary precondition to the commencement of a nonpayment proceeding. It is common practice, indeed I suspect it would not be an exaggeration to say it happens every day in every landlord/tenant court, for a landlord to make or serve a rent demand and then commence a nonpayment proceeding seeking to recover not only the rent and additional rent demanded, but also rent that accrued after the demand.
Judge Arlene P. Bluth in RCPI Landmark v. Chasm Lake Management Services, LLC, (56557/11 NYLJ 1202494916664, at *1 (Civ, NY, Decided May 9, 2011) found fault with this common practice and dismissed a nonpayment proceeding as fatally defective, because the petitioner sought to recover rent that was not demanded.
The facts in RCPI are straightforward: landlord served a rent demand on January 24, 2011, for rent due through January 2011; tenant failed to pay; landlord commenced a non-payment proceeding in February 2011, seeking the amount sought in the demand plus February 2011 rent. Respondent moved to dismiss “asserting that the petition is fatally defective because petitioner sued for February rent, which was never demanded.”
Despite recognizing that a “motion to amend the pleadings to conform to the proof should certainly be granted at the trial,” the Court nevertheless found the petition fatally defective because landlord “unilaterally sued for the February rent that was never demanded.” The Court continued: “A request to amend a petition to add rents that have accrued after service of the petition must be denied with the ability to renew upon service of the proper papers or at trial.” The Court concluded that “by unilaterally including the February rent in the petition, petitioner has attempted to circumvent the requirement of first demanding the rent. This shortcut, although common, is improper. Because the petition seeks rent that was never demanded, respondent’s motion is granted and the petition is dismissed.”
Thus, we have a clear example of elevating form over substance, especially because the initial return date of the petition is supposed to be the trial date (see, RPAPL § 745) — although that rarely occurs, in large part due to the overwhelming number of cases handled by the landlord/tenant courts. Nevertheless, it seems to be a waste of resources to dismiss a proceeding where the Court would have permitted the petition initially to include February rent if an additional demand was served and would have permitted an amendment to the petition at trial to include February 2011 rent and presumably all other subsequently accruing rent. Despite such, the Court determined that including February 2011 rent in the petition without service of an additional demand was fatally defective. There is no compelling reason for this ruling which will likely result in motion practice rendering nonpayment proceedings anything but “summary” and increased costs to the tenant if the lease requires the tenant to pay costs and fees associated with prosecuting the summary proceeding.
While additional courts will need to weigh in on this issue and hopefully there will be guidance from an appellate court, the simple lesson here is that if you represent a landlord, do not seek rent in a nonpayment proceeding if the rent has not been previously demanded.
Another recent proceeding in which a Court dismissed the petition based on a “defective” rent demand is JLNT Realty LLC v. McKenzie, 56518/2011, NYLJ 1202508287984, at *1 (Civ., KI, Decided, July 19, 2011). In JLNT , the Court dismissed the nonpayment petition where the amount sought in the rent demand was almost double the amount alleged due and sought in the petition.
In JLNT Realty, the landlord’s rent demand sought 2 month’s rent that had been previously paid by the tenant upon resolution of a previous non-payment proceeding. The stipulation of discontinuance of the previous proceeding specifically recited that tenant had paid rent through September 2010, but the landlord, in a new rent demand, sought rent for August 2010, and September 2010. The petitioner “corrected this error in the subsequent petition” but the Court nevertheless dismissed the petition because the rent sought in the rent demand was “not reasonably related to the actual amount owed and therefore the demand is defective.” The Court further found the rent demand was “not made in good faith and is defective as a matter of law. The importance to the tenant of receiving an accurate demand of rent due is of paramount importance, especially in view of the consequences of non-payment.”
It is interesting to note that the Court in RCPI did not discuss the requirement that a rent demand must seek an amount reasonably related to the actual amount owed. If the demand does not need to recite the exact amount owed, why is a petition defective if it seeks some rent not demanded? I suppose the Court in RCPI would say “because the statute requires it.” This seems to put us on a slippery slope requiring exact precision and agreement between the amount recited in a rent demand and a subsequent petition. I anticipate additional motions by tenants making these arguments, resulting in additional delays in disposing of proceedings.