Dep't of Housing Preservation
Dep’t of Housing Preservation
and Development v. Bryant
OATH Index No. 149/07 (Jan. 5, 2007), aff’d, Sup Ct. N.Y. Co. Index No. 102249/07 (Oct. 10, 2007, Bransten, J.), appended
Petitioner demonstrated that previous owner engaged in harassment of lawful SRO tenants within the meaning of section 27-2093 of the Administrative Code. Thus, respondent’s application for a certificate of no harassment should be denied.
______________________________________________________
NEW YORK CITY OFFICE OF
ADMINISTRATIVE TRIALS AND HEARINGS
In the Matter of
DEPARTMENT OF HOUSING PRESERVATION
AND DEVELOPMENT
Petitioner
- against -
DAVID BRYANT
Respondent
______________________________________________________
REPORT AND RECOMMENDATION
ALESSANDRA F. ZORGNIOTTI, Administrative Law Judge
Petitioner, the Department of Housing Preservation and Development, commenced this proceeding pursuant to section 27-2093 of the Administrative Code. Respondent, David Bryant is the owner of a building at 213 West 131st Street, New York County. Petitioner alleges that respondent and/or the previous owners of the building committed acts of harassment against the building’s single room occupancy (“SRO”) tenants during the three year inquiry period and that respondent’s application for a certificate of no harassment should be denied pursuant to section 27-198 of the Administrative Code.
A hearing was held on November 28, 2006, and the record kept open until December 15, 2006, for the filing of post-hearing briefs. At the hearing, petitioner relied upon documentary evidence and the testimony of Joseph Courtien, the Department’s then-Director of Special Enforcement, Peter DiMucci, a Supervisor Inspector, and Arbara Graves, a former tenant in the building. Respondent testified and relied upon documentary evidence, including a stipulation from lawful tenants averring that they had not been harassed. I find the evidence demonstrated that lawful tenants were harassed by the previous owners. Therefore, I recommend that respondent’s application for a certificate of no harassment be denied.
ANALYSIS
The building at 213 West 131st Street is a three-story structure with six SRO units and one other apartment (Pet. Exs. 1 & 7). Since 2002, the building has changed hands several times. On July 31, 2002, the building was purchased by Elaine M. Keller from a referee. On June 3, 2004, Radian Services, LLC purchased the building. Radian subsequently commenced two proceedings against the building’s tenants in Housing Part, Civil Court of the City of New York (Pet. Ex. 9). On December 30, 2004, Radian sold the building to Jo 213 West 131 Street, LLC who owned it until it was purchased by respondent on April 14, 2005 (Pet. Ex. 3).
On September 14, 2005, the Department received respondent’s application for a certificate of no harassment (Petition ¶ 1; Pet. Ex. 10). Before issuing such a certificate, the commissioner must certify that there has been no harassment of the lawful occupants of the premises within the 36 months preceding respondent’s application. Admin. Code § 27-2093(c) (Lexis 2006). Based on a preliminary finding, petitioner alleged that respondent and/or the previous owners: failed to comply with a vacate order issued on December 22, 2004; failed to provide essential services such as heat, hot water, and gas; failed to repair such things as defective plaster, holes in the ceiling, electrical fixtures, a leaking roof, the wooden floor, the pipes in the basement, and broken stairs; repeatedly told tenants they had to move and brought frivolous holdover proceedings against tenants; forced tenants to brings actions to get repairs done; and omitted material information from the application for certification of no harassment (Petition at ¶ 9).
At the hearing, petitioner established that prior to vacating the building in January 2005, Arbara Graves, Charles Strother, Larry Wise, Robert Gillyard, Reginald Hill, and Gerald Chance were lawful SRO occupants (Pet. Exs. 5 & 8 at ¶¶ 1 & 15; Tr. 18-20, 26-28). Petitioner also introduced a summary report of open and closed violations going back to 1966. There are currently 146 open violations on the building: 21 class A violations, 86 class B violations, 38 class C violations, and 1 class I violation (Pet. Exs. 6 & 7). During the inquiry period, the open class B violations concerned accumulation of refuse, leaks, broken plaster, defective locks and windows, a missing carbon monoxide detector, and in adequate electrical fixtures. The class C violations pertained to inadequate supply of hot and cold water, gas and electricity, broken floors, and a structurally defective staircase. The open violations affect both public areas and specific SRO units in the building (Pet. Exs. 6 & 7).
On December 21, 2004, petitioner issued a vacate order because the stairs to the building, the primary means of egress, were collapsing, essential services such as cold and hot water, heat, and gas were not being supplied, and the building was in total disrepair (Pet. Ex. 1).[1] Mr. Courtien testified that a vacate order is issued after inspectors and their supervisors determine that there are serious health and safety risks which necessitate the tenants vacate the building (Tr. 43-47, 52-53). According to Mr. DiMucci, the vacate order was based on Inspector Jose Morales’ inspections of the building and his own follow-up inspection to certify that these conditions existed (Tr. 72, 74, 76-77).
After the vacate order was issued, Mr. Courtien was in contact with the tenants regarding enforcement of the order and their departure from the building (Tr. 48-49; Pet. Ex. 4). Ms. Graves testified that on January 6, 2005, she and some of the other tenants were arrested for trespassing. When they returned to the building, it was gutted, the locks had been changed, and their personal possessions had been thrown into a dump truck outside the building (Tr. 24, 28-29, 37-38).
On January 10, 2005, Jo 213 West 131 Street, LLC was substituted for Radian Services, LLC, as the landlord-petitioner in the Housing Part proceeding (Pet. Ex. 9). On January 19, 2005, the parties entered into a so-ordered stipulation of settlement in the Housing Part (Pet. Ex.8). In the stipulation, the tenants agreed to vacate the premises by February 11, 2005, and the landlord agreed to pay each tenant $5,500, to waive back rent owed, and to provide specific payments to three tenants for personal items which were lost or damaged. Ms. Graves testified that she was paid $300 for a microwave oven and a cell phone which were thrown away while she was in police custody (Tr. 39). The agreement also disposed of all claims that the parties had or may have had against each other and included a representation that each tenant “has in no way been harassed by petitioner” (Pet. Ex. 8).
Respondent testified that he and his brother in-law Frank Johnston, a contractor and developer, were looking for properties in Harlem, “a hot area to redevelop” (Tr. 86). They were shown 213 West 131st Street by a broker. Neither respondent nor Mr. Johnston knew the previous owners or the tenants in the building. When they saw the building, it was vacant and needed to be gutted and completely renovated (Tr. 84, 86-87, 98-100; Resp. Ex. A).
Under section 27-2093(a) of the Administrative Code, harassment is defined as:
(1) the use or threatened use of force which causes or is intended to cause [a lawful occupant] to vacate his or her unit or surrender or waive any rights therein; (2) the interruption or discontinuance of essential services which (i) interferes with or disturbs or is intended to interfere with or disturb the comfort, repose, peace or quiet of a [lawful occupant] in the use or occupancy of such dwelling unit and (ii) causes or is intended to cause [a lawful occupant] to vacate such unit or to surrender or waive any rights in relation to such occupancy; (3) the failure to comply with the provisions of [a vacate order] which causes or is intended to cause [a lawful occupant] to vacate such unit or waive any rights in relation to such occupancy; or (4) any other conduct which prevents or is intended to prevent any person from the lawful occupancy of such dwelling unit or causes or is intended to cause [a lawful occupant] to vacate such unit or to surrender or waive any rights in relation to such occupancy . . . .
Any acts of harassment during the 36-month inquiry period are attributed to the current owner, even those acts committed by prior owners, without regard to the current owner’s fault. See Dep’t of Housing Preservation & Development v. Freid, OATH Index No. 1567/04 (Feb. 3, 2005); Dep’t of Housing Preservation & Development v. Fenelon, OATH Index No. 1525/04 (Oct. 6, 2004); Dep’t of Housing Preservation & Development v. Serradilla, OATH Index No. 1802/01 (July 18, 2001). Moreover, section 27-2093(b) creates a rebuttable presumption that, if an act of harassment is proven, “such acts or omissions were committed with the intent to cause a [lawful occupant] to vacate such unit or to surrender or waive a right” to lawful occupancy.
There is no dispute that 213 West 131st Street has a history of housing maintenance code violations. Indeed, conditions were so hazardous that petitioner issued an emergency order to vacate the building in December 2004 due to a complete lack of services and unsafe conditions. Within four months of issuing the vacate order, Jo 213 West 131 Street, LLC delivered the building, without tenants, to respondent. This tribunal has stated that numerous violations and a vacate order are sufficient to establish a prima facie case of harassment and create a presumption that there was an intent to cause lawful occupants to surrender their occupancy rights. See Dep’t of Housing Preservation & Development v. Havriliak, OATH Index No. 1135/05, at 6 (Jan. 13, 2006); Dep’t of Housing Preservation & Development v. Blanchard, OATH Index No. 553/06, at 7 (Aug. 9, 2006); Dep’t of Housing Preservation & Development v. Serradilla, OATH Index No. 1802/01 (July 18, 2001). Accordingly, I find that petitioner has demonstrated harassment as defined in section 27-2093(a).
Respondent did not dispute the hazardous conditions in the building and testified that when he took title, it was uninhabitable and in need of a complete gut and renovation. Instead, respondent seeks to defeat the petition on two grounds. First, respondent claimed that petitioner is collaterally estopped from alleging harassment based on the tenants’ stipulation of settlement in the Housing Court proceeding. Second, respondent argued that during a settlement conference at OATH, the tenants engaged in criminal behavior by soliciting a second monetary settlement when petitioner had no intention of settling this case. Both arguments are misplaced.
The doctrine of collateral estoppel precludes a party from re-litigating, in a subsequent action, an issue clearly raised in a prior proceeding and decided against that party or those in privity. Gramatan Home Investors Corp. v. Lopez, 46 N.Y.2d 481, 414 N.Y.S.2d 308 (1979); Ryan v. New York Telephone Co., 62 N.Y.2d 494, 500-01, 478 N.Y.S.2d 823, 826-27 (1984). The party seeking the benefit of collateral estoppel, bears the burden to demonstrate the identicality and decisiveness of the issue, while the burden rests upon the opponent to establish the absence of a full and fair opportunity to litigate the issue in the prior proceeding. Ryan, 62 N.Y.2d at 500-01, 478 N.Y.S.2d at 826-27; Kaufman v. Eli Lilly and Co., 65 N.Y. 2d 449, 455, 492 N.Y.S.2d 584, 588 (1985). Here, respondent has failed to demonstrate that the issue of tenant harassment was litigated in the Housing Court proceeding, and petitioner has demonstrated that it did not have a full and fair opportunity to litigate this question prior to this proceeding.
Petitioner provided unrebutted statements that the Housing Court proceeding was commenced pursuant to Real Property Actions and Proceedings Law section 713 by respondent’s predecessor in interest in an effort to evict several tenants from the building. According to petitioner, there was no mention of harassment in the pleadings or the motion papers filed in the prior proceeding. The only time harassment was mentioned, was in the one-line of the so-ordered stipulation of settlement. See Petitioner’s Memorandum of Law at 3, n. 1. Respondent produced no evidence to meet its burden to demonstrate the identicality of issue and relied solely on the stipulation signed by the tenants stating that they had not been harassed to preclude re-litigation of petitioner’s harassment claim. The Court of Appeals has stated that “[a]n issue is not actually litigated if, for example, there has been a default, a confession of liability, a failure to place a matter in issue by proper pleading or even because of a stipulation” Id. citing Restatement [Second] of Judgments § 27 comments d, e, at 255-257. Accordingly, I find that the tenants’ stipulation, standing alone, is insufficient to establish that the issue of tenant harassment was actually litigated in the prior proceeding.[2]
In order to establish privity, “the connection between the parties must be such that the interests of the nonparty can be said to have been represented in the prior proceeding.” Green v. Santa Fe Industries, Inc., 70 N.Y.2d 244, 253, 519 N.Y.S.2d 793, 796 (1987). Here, petitioner was not a party to the Housing Court proceeding and there is no evidence that it had any control over the litigation. Matter of Rebo, OATH Index Nos. 924/03 & 926/03, at 5 (Dec. 18, 2003) aff’d, Loft Bd. Order No. 2840 (Jan. 15, 2003) (where tenants were not parties in prior action, and were not in privity with Loft Board, tenants allowed to re-litigate whether landlord withheld legally required elevator service); Matter of Moran, OATH Index Nos. 2016/00, at 45 (Feb. 7, 2002), aff’d, Loft Bd. Order No. 2726 (Apr. 18, 2002) (tenant not prohibited from maintaining hardship application, since he was not a party to or in privity with a party to other tenant’s prior hardship proceeding).
Unlike the prior eviction proceeding, the instant case was commenced by petitioner pursuant to the SRO Anti-Harassment ordinance in response to a request for a certificate of no harassment. See New York City Local Law 19, Act of May 31, 1983, no. 19, 1983 N.Y. City Local Laws. Under this law, petitioner has a statutory obligation to make a determination whether harassment of SRO tenants has occurred within three years of receiving such a request. See Administrative Code § 27-2093. Courts have recognized that the general thrust of the statute “is to set up a scheme under which the presence of tenant harassment will be investigated before plan approval or permits will issue for the renovation or demolition of any SRO, and under which harassment will be penalized where it is found to have occurred.” Sadowsky v. City of New York, 732 F.2d 312, 315 (2d Cir. 1984); see also Serradilla, OATH Index No. 1802/01, at 16 (statute provides protection for SRO tenants from owners who would unlawfully cause them to vacate and then develop the property for profit, thereby diminishing an already dwindling SRO housing stock). Since petitioner has not had a full and fair opportunity to have an evidentiary hearing on whether lawful SRO tenants at 213 West 131st Street were harassed during the three-year inquiry period, respondent’s application to preclude litigation on this issue is denied.
Finally, respondent’s application to dismiss the petition based on the tenants’ conduct at the settlement conference is also without merit. On September 6, 2006, a pre-trail settlement conference was held pursuant to OATH’s rules of practice section 1-29. Petitioner was represented by Ms. Phyllis Simpson, respondent appeared pro se, and the tenants appeared and were represented by Molly Dougherty, an attorney for the West Side SRO Law Project. During the conference, the tenants allegedly made a monetary demand to respondent. Petitioner, however, took the position that settlement of this matter would be inappropriate. Accordingly, the case was referred for a hearing. At trial respondent attempted to introduce testimony concerning the demand made by the tenants. Because OATH rules protect the confidentiality of discussions which occur at a settlement conference and provide that settlement offers “shall be inadmissible at trial of any case,” see 48 RCNY § 1-31(b), petitioner’s objection to this testimony was sustained (Tr. 11-12, 88-98). Moreover, any claims of prejudice to respondent or challenges to Ms. Graves’ credibility were irrelevant at the hearing because petitioner relied solely on the vacate order and the history of violations to establish its prima facie case of harassment.[3] Finally, there was no evidence that the tenants were engaging in criminal behavior, and, in any event, this tribunal lacks jurisdiction to hear such claims.
Even though respondent is an innocent owner with no prior connection to those responsible for the acts of harassment, and appears willing and able to renovate the uninhabitable building, the statute makes no provision for a remedy other than the non-issuance of a certificate of no harassment. Serradilla, OATH Index No. 1802/01, at 17.
FINDINGS AND CONCLUSIONS
1. There was an interruption and/or discontinuance of essential services which interfered with the comfort, repose or quiet of the lawful tenants residing at 213 West 131st Street during the 36-month inquiry period.
2. The interruption and/or discontinuance of essential services was intended to cause the lawful SRO tenants at 213 West 131st Street to vacate or to surrender or waive any rights in relation to their units.
3. The acts of harassment during the 36-month inquiry period are presumed to be by or on behalf of the owner.
RECOMMENDATION
I recommend that respondent’s application for a certificate of no harassment be denied.
Alessandra F. Zorgniotti Administrative Law Judge
January 5, 2007
SUBMITTED TO:
SHAUN DONOVAN
Commissioner
APPEARANCES:
MICHELLE MERSHON, ESQ.
Attorney for Petitioner
MICHAEL STEPPER, ESQ.
Attorney for Respondent
MOLLY DOUGHERTY, ESQ.
Attorney for West Side SRO Law Project
Supreme Court New York County, Index No. 102249/07, October 10, 2007
_______________________________________________________
In the Matter of the Application of
DAVID A. BRYANT
Petitioner
- Against -
NYC DEPARTMENT OF HOUSING
PRESERVATION AND DEVELOPMENT
Respondent
For an Order under C.P.L.R. Article 78
_______________________________________________________
EILEEN BRANSTEN, Supreme Court Judge, New York County
OPINION
In this Article 78 proceeding, petitioner David A. Bryant ("Mr. Bryant") seeks a Judgment setting aside the final determination of the New York City Department of Housing Preservation and Development ("HPD"), which denied his application for a Certificate of No Harassment. HPD vigorously opposes the petition.
BACKGROUND
This proceeding relates to a seven-unit building and property located at 213 West 131st Street in Manhattan ("the Property").
In July 2004, Radian Services LLC--the owner of the property--commenced an eviction proceeding against six tenants in Housing Court. Verified Answer ("Answer"), at ¶ 75.
On December 21, 2004, the Special Enforcement Unit of HPD issued an Order to Repair/Vacate Order for the Property ("Vacate Order"). Answer, at ¶ 77. The Vacate Order set forth that an inspector certified that the dwelling was "dangerous to life and detrimental to the health and safety of the occupants" based on, among other things, "sagging/collapsing stairs, * * * no heat * * * no gas supply * * * no hot water * * * no water supply * * * Bldg in total disrepair." Answer, at ¶ 77. It was ordered that the owner repair the building by the following day. Id.
The conditions at the Property were not timely cured. Answer, at ¶ 78. HPD continued to monitor the situation on a regular basis. Id.
On December 30, 2004, the Property was transferred to Jo West 131st Street, LLC ("Jo West"), of which Jeff Ozeri ("Mr. Ozeri") was a member. Answer, at ¶ 76. Jo West was substituted as a petitioner in the Housing Court eviction proceeding. Id., at ¶ 80.
On January 19, 2005, the parties to the eviction proceeding entered into a Stipulation of Settlement that was so-ordered by the court. The Stipulation indicated that the respondent tenants were A. Kym Graves, Charles Strother, Larry Wise, Robert Gillyard, Reginald Hill and Gerald Chance. Verified Petition ("Petition"), Ex. G, at ¶ 1. Under the terms of the parties’ agreement, the tenants agreed to vacate the Property. They received, among other things, $5,500, moving costs and their use and occupancy payments were waived. Id., at ¶ 7.
The stipulation stated:
"Both parties withdraw each of their claims and/or counterclaims as set forth in the petitions and answer(s) * * *. Both parties also release each other, their officers, partners, members, employees, agents, heirs and assigns from any and all claims arising out of the [tenants] residency in the subject property to date. Each of the respondents [tenants] further represents that he/she has in no way been harassed by petitioner [owner]."
Petition, Ex. G., at ¶ 12 (emphasis added). If the owner failed to fulfill any of the stipulation's obligations the tenants reserved their rights to restore the cases. Id., at ¶13.
On January 20, 2005, pursuant to HPD's December 21, 2004 Vacate Order, HPD vacated the Property. Verified Answer ("Answer"), at ¶ 82.
On April 14, 2005, Mr. Bryant, an innocent arms-length purchaser, acquired the Property from Jo West. Petition, at ¶ 12; Answer, at ¶ 83.
Because he wanted to renovate the Property, in August 2005, Mr. Bryant applied to HPD for a Certificate of No Harassment. Petition, at ¶ 13, Ex. B. In his application, Mr. Bryant indicated that the relevant inquiry period was August 16, 2002 through August 16, 2005. Petition, Ex. B. Item 18 of the application required him to list "all former occupants who have surrendered the units they occupied at the subject premises, or otherwise vacated, from the opening date of the Inquiry Period to the present." The application set forth that if "you have not owned the premises during the entire inquiry period, please contact former owners for this information." Id. In response, Mr. Bryant indicated "None," omitting occupants' names, the units they occupied, the dates they vacated, their reasons for vacating and their current contact information. Id.
Item 19 required Mr. Bryant to list "all lawsuits relating to the subject premises commenced, pending or resolved during the inquiry period." Petition, Ex. B. Again, Mr. Bryant indicated "None." Id.
By petition dated July 10, 2006, pursuant to Administrative Code § 27-2093, HPD sought to prohibit renovation of the Property for three years on the ground that "harassment occurred at the premises 213 West 131st Street, Borough of Manhattan, during the inquiry period." Petition, Ex. C, at 7. Specifically, the petition set forth that between September 14, 2002 to the present, the "alleged acts of harassment [that] were done or caused by the applicant, applicant's agents, present owners or prior owners or their agents" included:
• Failure to comply with a vacate order placed against the property effective December 22, 2004;
• Failure to provide adequate heat and hot water;
• Failure to provide gas to the building;
• Failure to repair defective plaster;
• Failure to repair holes in the ceiling;
• Failure to repair electrical problems;
• Failure to repair leaking roof;
• Failure to repair wooden floor;
• Failure [to repair] bathtub, pipes and flooding in basement;
• Failure to repair broken steps;
• Repeatedly telling tenants they had to move;
• Bringing frivolous holdover proceedings against tenants;
• Forcing tenants to bring HP actions in order to get repairs done;
• Omitting material information from the application for a certification of no harassment, including but not limited to, the HP actions brought by the tenants, the list of former tenants, etc.;
• Failure to repair hazardous violations timely which caused the Emergency Repair Program at HPD to repair said violations, which include, but are not limited to, supplying electricity to the building, concealing water leaks; and
• Generally interrupting and/or discontinuing and decreasing essential services and repairs."
Petition, Ex. C, at 5-6.
In his answer to the petition, Mr. Bryant maintained that when he purchased the Property it was vacant and he "had no knowledge of tenants or any alleged harassment prior to the instant proceeding." Petition, Ex. D, at ¶ 4. He asserted that "all allegations of harassment of former tenants * * * pertain to [his] predecessors in interest." Id., at 15. He further contended that the January 19, 2005 so-ordered stipulation "constitutes a prior judicial determination that the alleged tenants of the subject premises had in ‘no way been harassed’ by the prior owner" and that HPD "is estopped from herein seeking to prove harassment of alleged tenants in derogation of the Civil Court Order issued January 19, 2005." Id., at ¶¶ 8-9.
An administrative hearing was scheduled. HPD's potential witnesses included former tenants Arbara Kym Graves (who actually testified), Charles Strother, Robert Gillyard, Larry Wise and Reginald Hill, who were parties to the earlier Housing Court proceedings. Petition, Ex. E.
On January 19, 2007, HPD issued a final determination denying Mr. Bryant's application for a certification of no harassment based on the Report and Recommendation of the Administrative Law Judge ("ALJ"). Petition, Ex. F; Answer, Ex. T.
The ALJ found that there were "currently 146 open violations on the building" and explained that any "acts of harassment during the 36-month inquiry period are attributed to the current owner, even those acts committed by prior owners, without regard to the current owner's fault." Petition, Ex. F, at 4.
The ALJ concluded:
"There is no dispute that [the Property] has a history of housing maintenance code violations. Indeed conditions were so hazardous that [HPD] issued an emergency order to vacate the building in December 2004 due to a complete lack of services and unsafe conditions. Within four months of issuing the vacate order [Jo West] delivered the building, without tenants, to [Mr. Bryant]. This tribunal has stated that numerous violations and a vacate order are sufficient to establish a prima facie case of harassment and create a presumption that there was an intent to cause lawful occupants to surrender their occupancy rights. * * * Accordingly, I find that [HPD] has demonstrated harassment as defined in section 27-2093(a). "
Petition, Ex. F, at 5.
The ALJ rejected Mr. Bryant's arguments that HPD was collaterally estopped from alleging harassment based on the Housing Court stipulation and that alleged "criminal behavior" by the tenants in soliciting a monetary settlement precluded a harassment finding. Petition, Ex. F, at 5.
Specifically, with respect to collateral estoppel, the ALJ found that Mr. Bryant "failed to demonstrate that the issue of tenant harassment was litigated in the Housing Court proceeding, [and] HPD * * * demonstrated that it did not have a full and fair opportunity to litigate this question prior to this proceeding." Petition, Ex. F, at 5-6. The ALJ set forth that the one-line in the stipulation that mentioned harassment was not enough to implicate preclusion, stating that "the tenants' stipulation, standing alone, is insufficient to establish that the issue of tenant harassment was actually litigated in the prior proceeding." HPD was not in privity with the tenants for purposes of applying collateral estoppel, the ALJ found, because it "was not a party to the Housing Court proceeding and there is no evidence that it had any control over the litigation." Id. The ALJ explained that unlike the eviction proceeding, the present case was commenced "pursuant to the SRO Anti-Harassment ordinance in response to a request for a certificate of no-harassment" and that HPD "has a statutory obligation to make a determination whether harassment of SRO tenants has occurred within three years of receiving such a request." Id., at 7.
The ALJ further found that the tenants "monetary demand" to Mr. Bryant, which HPD considered "inappropriate," and the sustained objection to admitting evidence of the settlement offer at the hearing, did not alter the conclusion that there had been harassment at the Property. Petition, Ex. F, at 7.
The ALJ stated that even though Mr. Bryant "is an innocent owner with no prior connection to those responsible for the acts of harassment, and appears willing and able to renovate the uninhabitable building, the statute makes no provision for a remedy other than the non-issuance of a certificate of no harassment." Petition, Ex. F., at 8.
Mr. Bryant commenced this Article 78 proceeding seeking a Judgment setting aside HPD's final determination. He argues that the ALJ improperly failed to apply collateral estoppel to prevent relitigation of a decided issue. Petitioner's Memorandum of Law ("Bryant Mem. "), at 20. Mr. Bryant contends that HPD and the tenants in the Housing Court proceedings have a "mutually beneficial posture" and therefore that they meet the "broad definition of being in privity for collateral estoppel purposes." Bryant Mem., at 22. He asserts that HPD "is acting herein on behalf of the same tenants" that were subject to the consent order "and is in privity with its five tenant witnesses who previously were the litigants." Id., at 24.
Mr. Bryant states that "neither [HPD) nor the administrative court below have appellate jurisdiction necessary to review the civil court consent order," Petitioner's Reply Memorandum of Law ("Reply Mem."), at 2-3.
Mr. Bryant also maintains that the tenant witnesses attempted to bribe him by asking for $20,000 in exchange for refusing to testify on HPD's behalf. Petition, at ¶¶ 51, 53. He urges that it was error for the ALJ to allow one of the tenants to testify but deny him the opportunity to cross-examine her related to the $20,000 solicitation on the ground that settlement negotiations are inadmissible. Id., at ¶¶ 54-55.
HPD counters that collateral estoppel is inapplicable because the Housing Court stipulation does not establish that the issue of harassment was actually litigated or decided by the court. Answer, at ¶ 106. HPD further contends that Mr. Bryant has not demonstrated privity between HPD and the tenants since its interests were not represented in the Housing Court proceeding. Id., at ¶ 107. HPD emphasizes that the "tenants and the landlord cannot foreclose [it] from carrying out its duty by one line in a stipulation in a proceeding in which HPD did not even participate." Id., at ¶ 107. HPD also maintains that the ALJ properly precluded discussion of the parties' settlement negotiations at the hearing. Answer, at ¶ 114.
HPD defends its determination, explaining that it "followed all applicable procedures" and that "denial of the application for a Certificate of No Harassment was within [its] authority, and was reasonable and proper in all respects." Answer, at ¶ 108.
Because collateral estoppel does not preclude HPD's denial of Mr. Bryant's application for a Certificate of No Harassment and because the final determination was rational, the petition is denied and the proceeding is dismissed.
ANALYSIS
"Collateral estoppel precludes a party from relitigating in a subsequent action or proceeding an issue raised in a prior action * * * and decided against that party or those in privity." Buechel v. Bain, 97 N.Y.2d 295, 303 (2001). "Two requirements must be met before collateral estoppel can be invoked. There must be an identity of issue which has necessarily been decided in the prior action and is decisive of the present action, and there must have been a full and fair opportunity to contest the decision now said to be controlling." Id., at 303-304.
Additionally, in addressing whether a non-party should be deemed in privity with one who already litigated an issue, "courts must carefully analyze whether the party sought to be bound and the party against whom the litigated issue was decided have a relationship that would justify preclusion, and whether preclusion, with its severe consequences would be fair under the particular circumstances. Doubts should be resolved against imposing preclusion to ensure that the party to be bound can be considered to have had a full and fair opportunity to litigate." Buechel v. Bain, 97 N.Y.2d, at 305 (emphasis added).
Here, there is no doubt that collateral estoppel is inapplicable.
At the outset, there is no privity between HPD and the tenants in the Housing Court matter. Indeed, they do not remotely have a "relationship that would justify preclusion." The interests of HPD, are materially different from those of the tenants. The tenants simply cared about resolution of their pending Housing Court case. Their concern was limited to receiving sufficient compensation, nothing more.
HPD--the only party with standing to initiate a harassment proceeding pursuant to Administrative Code § 27-2093--has wholly different responsibilities, objectives and concerns. It is duty bound to ensure that there has been no harassment of lawful occupants of a multiple dwelling during the thirty-six month period before an application for a certification of no harassment. It had no opportunity or obligation to litigate "harassment" in the Housing Court proceeding. That HPD called on the Housing Court tenants to testify at its administrative proceedings, which took place long after the stipulation's execution, is of no consequence. It does not demonstrate that HPD was in privity with these individuals then or over a year earlier when the stipulation was signed.
Mr. Bryant's reliance on Buechel v. Bain is misplaced. There, parties to be bound by an earlier judicial determination were named parties in that earlier action and were partners with the party against whom the issue was decided. They had notice of what was being litigated in the earlier action and the evidence established that they understood they could be bound by a judicial determination adverse to their partner.
HPD, in stark contrast, was not a party to the Housing Court matter, and with its own independent objectives and responsibilities, does not have a relationship with the former tenants "that would justify preclusion."
Additionally, the issue of harassment covered by Administrative Code § 27-1093 was not actually litigated or decided by the Housing Court. The Housing Court proceedings did not address whether there had been any harassment pursuant to Administrative Code § 27-2093. Indeed, there had not been any application for a certificate of no harassment and HPD had no occasion to investigate the matter. The issue of harassment under Administrative Code § 27-1093 was not actually litigated and certainly not decided by virtue of the one-line mention of "harassment" in a stipulation to which HPD was not a party. See, Kaufman v. Eli Lilly & Co., 65 N.Y.2d 449, 457 (1985) (no collateral estoppel based on stipulation); Angel v. Bank of Tokyo-Mitsubishi, Ltd., 39 A.D.3d 368, 371 (1st Dept. 2007) (no issue preclusion based on a "consent order" because "collateral estoppel is inapplicable if an issue has not been fully litigated, e.g., if there has been a stipulation").
It is preposterous to even suggest that tenants, who have private interests entirely different from HPD's, could enter into a stipulation that would then bind the governmental agency and prevent it from furthering public interest. If preclusion were to apply under such circumstances private parties could entirely circumvent the Administrative Code.
In the end, HPD, which was not in privity with the Housing Court tenants, did not have any incentive or any opportunity--much less a full and fair one--to contest the issue of harassment in the Housing Court proceeding.
Finally, because there was a rational basis for denying Mr. Bryant's application for a Certificate of No Harassment, the determination must be upheld.
Accordingly, it is ORDERED and ADJUDGED that the petition is denied and the proceeding is dismissed.
This constitutes the Decision, Order and Judgment of the Court.
ENTER:
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EILEEN BRANSTEN, Supreme Court Judge, New York County
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK: PART 6
FILED: OCTOBER 10, 2007
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[1] The Housing Maintenance Code requires the owner of a multiple dwelling to register with the Department annually. See Administrative Code § 27-2097. According to petitioner’s records, the last registration was filed by Ms. Keller (Pet. Exs. 1 & 2; Tr. 57-58). While the vacate order was mailed to Ms. Keller, it appears that Jo 213 West 131 Street, LLC had notice of the order (Pets. Exs. 4 & 9).
[2] This tribunal has considered such stipulations as a factor to be considered when evaluating a harassment claim. In Dep’t of Housing Preservation & Development v. Schwartz, OATH Index No. 788/06, at 5 (July 16, 2006), Judge Spooner stated that a disclaimer of harassment is common in landlord-tenant settlements and, in the face of compelling evidence of malicious activities by the landlord, should not be accorded much weight. Because the proof in support of misdeeds by the landlord was, at best, equivocal, the disclaimer was found to be sufficient to conclude that none of the tenants believed they were harassed. In Havriliak, OATH Index No. 1135/05, at 6, Judge Casey also recognized that there may be situations where provisions contained in settlement agreements are untrustworthy because they are contrary to the proven facts. There, sworn statements made by tenants that they had not been harassed were accepted because they were consistent with the record. Here, unlike these previous cases, the tenants so-ordered statement that they were in “no way been harassed,” is insufficient to rebut the compelling evidence that the previous landlord engaged in acts of harassment in order to cause them to vacate the building.
[3] Petitioner presented Ms. Graves solely for the purpose of establishing that a lawful tenant was living in the building and I have not considered any other portions of her testimony in determining the issue of harassment (Tr. 19-21, 90).
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