Frank M. Mora, J.
Sean P. O'Fallon, Esq.
Catalano & O'Fallon, LLP
Attorneys for the Petitioner
Christopher L. Mamone, Esq.
Legal Services of the Hudson Valley
Attorneys for the Respondent
Rebecca Valk, Esq., Corporation Counsel
City of Poughkeepsie Corporation Counsel's Office
Frank M. Mora, J.
On September 8, 2022, respondent filed this motion to dismiss the non-payment summary proceeding filed against her in this Court on August 3, 2022. Respondent contends that the matter should be dismissed on various grounds. In the alternative, respondent seeks an order reversing petitioner's rental increase because it exceeds 5% and is violative of the City of Poughkeepsie's recently enacted Good Cause Eviction Law ["GCEL"] set forth in LL-21-04. Respondent's motion is supported by the affirmation of Christopher L. Mamone, Esq., dated September 7, 2022, the affidavit of Danielle Paul, dated September 6, 2022, together with Exhibits A-G. On September 20, 2022, petitioner filed opposition to the motion disputing respondent's claims, supported by the affirmation of Sean P. O'Fallon, Esq., dated September 16, 2022, the affidavit of Crystal Gonzalez, dated September 16, 2022, together with Exhibits A-G. On September 22, 2022, respondent filed a reply in further support of her motion and in reply to petitioner's opposition, supported by the affirmation of Christopher L. Mamone, Esq., dated September 22, 2022. In response, petitioner filed a letter, dated September 26, 2022, objecting to what petitioner claims are novel arguments raised by respondent in her reply affirmation. In turn, on September 26, 2022, respondent filed with this Court a letter (undated) objecting to petitioner's letter on the grounds that the letter constitutes a sur-reply that was filed without permission of the Court. At a court conference held on November 30, 2022, this Court directed that the City of Poughkeepsie Corporation Counsel's Office be copied on the motion, and that the City of Poughkeepsie be given an opportunity to file papers in response to the Petitioner's claim that the GCEL passed by the City of Poughkeepsie's Common Council on November 15, 2021, was unconstitutional. Thereafter, the City of Poughkeepsie intervened in the action, by filing an Affirmation in Defense of the City of Poughkeepsie's GCEL from Joanna M. Longcore, Esq., Assistant Corporation Counsel, dated January 4, 2023. In response, on January 24, 2023, petitioner filed an affirmation in opposition to the City of Poughkeepsie's GCEL, from Sean P. O'Fallon, Esq., dated January 23, 2022 [sic].
Respondent argued in their reply papers that it was petitioner's burden pursuant to C.P.L.R. § 1012(b)(2), to file and serve the City of Poughkeepsie notice that petitioner was challenging the constitutionality of the GCEL, and that failure to do so bars consideration of petitioner's constitutional arguments. While there is no statutory provision explicitly imposing the notice obligation on the party raising the constitutional issue, C.P.L.R. § 1012(b)(3) implies that the duty rests with the party raising the issue - in this case, the petitioner. As such, since a necessary party was not notified, and the City of Poughkeepsie has chosen to intervene in defense of the GCEL by filing papers arguing that the law is constitutional, their arguments are duly considered herein.
Having now duly considered the following:
1) The affirmation of Christopher L. Mamone, Esq., dated September 7, 2022, the affidavit of Danielle Paul, dated September 6, 2022, together with Exhibits A-G;
2) The affirmation of Sean P. O'Fallon, Esq., dated September 16, 2022, the affidavit of Crystal Gonzalez, dated September 16, 2022, together with Exhibits A-G;
3) The reply affirmation of Christopher L. Mamone, Esq., dated September 22, 2022;
4) The affirmation of Joanna M. Longcore, Assistant Corporation Counsel, dated January 4, 2023; and
5) The affirmation of Sean P. O'Fallon, Esq., dated January 23, 2022 [sic]; the Court finds and determines the motion as follows:
BACKGROUND AND FACTS
Respondent has lived in the premises since 2017. She resides there with her two-year-old son. Respondent's prior lease covered the period from May 1, 2021, through April 30, 2022, with a monthly rental fee of $1,400.00. In January 2022, petitioner allegedly sent respondent a notice renewing the lease and threatened eviction if the new lease with new terms was not signed. Respondent's renewal lease was signed in May 2022 - at which time she was represented by counsel. The renewal lease increased the rent from $1,400.00 to $1,550.00 - a 10% rental increase. Any rental increase over 5% is presumed to be "unconscionable" under the newly enacted GCEL. After signing the renewal lease, respondent instead paid $1,470.00 per month (a 5% rental increase) rather than the $1,550.00 set forth in the renewal lease. Regardless of the tenant's consent, the GCEL provides that rental increases may still be found unconscionable. When respondent signed renewal leases in 2020 and 2021, she was required to furnish additional security to her landlord. As of September 2, 2022, the amount of security that exceeds one month's rent has not been returned to her. Specifically, petitioner is retaining $2,650.00 for security, even though the monthly rent is $1,550.00. Respondent contends she is only lawfully required to post $1,470.00 and seeks to be refunded $1,180.00 (the amount she claims is being unlawfully held by petitioner to the extent that it exceeds one month's lawful rent).
Respondent also claims that the rental increase is prohibited because it creates a rent burden resulting in respondent paying 30% of her monthly income in rent.
On August 3, 2022, petitioner filed a non-payment summary proceeding seeking a judgment for rental arrears in the amount of $240.00 (representing rental balance for May, June, and July 2022) and a warrant of possession. The GCEL provides that no eviction may proceed in the City of Poughkeepsie unless the landlord has pled good cause. GCEL § 12-176(a)(1). Other than non-payment of rent (which respondent maintains is unconscionable under the GCEL), the petition does not set forth any other good cause pursuant to the GCEL for the eviction, and respondent raised the GCEL as a defense to the action. The matter was scheduled for a first appearance on August 24, 2022, at which time both parties appeared. Respondent, represented by Legal Services of the Hudson Valley, filed an Answer together with affirmative defenses and counterclaims, and a motion schedule was set at respondent's request. Thereafter, on September 8, 2022, respondent filed the instant motion to dismiss, and petitioner has opposed same. Upon being directed by the Court to serve a copy of the papers upon the City of Poughkeepsie concerning the constitutionality of the GCEL, Corporation Counsel for the City of Poughkeepsie intervened defending the GCEL, and petitioner filed opposition papers to Corporation Counsel's defense of the GCEL.
I. RESPONDENT'S MOTION TO DISMISS
Respondent's motion contends that the matter should be dismissed because:
1) Petitioner's 10% rental increase violates the City of Poughkeepsie's GCEL set forth in § 12-176 A (1), which provides that any rental increase over 5% is presumed unconscionable;
2) Since the increase is presumed unconscionable, the GCEL prohibits petitioner from evicting respondent based upon unpaid rent caused by an unconscionable rent increase;
3) The 10% rental increase is not commensurate with improvements made to the premises or the common areas;
4) The instant proceeding is retaliatory in that the respondent complained about needed repairs that petitioner failed to address;
5) The petition's pleadings are not sufficiently particular as required by C.P.L.R. § 3013 and R.P.A.P.L. § 741 (4), and fails to plead good cause in accordance with GCEL § 12-176 (a)(1), requiring dismissal pursuant to C.P.L.R. § 3211(a)(7); and
6) Petitioner has violated G.O.L. § 7-108, which maintains that a landlord may only retain one month's worth of rent as a security deposit.
II. PETITIONER'S OPPOSITION TO RESPONDENT'S MOTION TO DISMISS
1) In opposition to the motion to dismiss, petitioner contends the motion must be denied because:
2) The petition meets the pleading requirements of R.P.A.P.L. § 741 and C.P.L.R. § 3013 and sets forth with sufficient particularity the relief sought;
3) GCEL is void, unenforceable, and otherwise preempted by New York State Law because it is in direct conflict with R.P.L. § 228 and R.P.A.P.L. § 711 which does not impose a good cause requirement to evict a tenant when the tenancy has expired;
4) Even if the GCEL is not void, unenforceable, or otherwise preempted by New York State Law, petitioner has pled good cause pursuant to same, in that failure to pay rent constitutes good cause to evict under the GCEL § 12-176 (a)(1);
5) Even if the GCEL is not preempted, an issue of fact exists as to whether the landlord has good cause to increase the rent over 5%, thereby defeating respondent's motion to dismiss;
6) Respondent waived her right to challenge the rental increase when she entered into and executed the renewal lease and agreed to the rental increase, while being represented by counsel; and Petitioner opposes respondent's application that her security deposit be returned to the extent that such relief cannot be raised in a motion to dismiss.
III. RESPONDENT'S REPLY PAPERS
In reply, respondent maintains that petitioner has failed to plead good cause, and that the GCEL is not preempted by New York State Laws. Respondent further argues that this Court does not have jurisdiction to adjudicate constitutional legal issues. Respondent also contends that petitioner is seeking declaratory relief from this Court for which this Court has no jurisdiction.
IV. CORPORATION COUNSEL'S PAPERS IN DEFENSE OF THE GCEL
Corporation Counsel for the City of Poughkeepsie has intervened in the action and has filed opposition papers to defend the constitutionality of the GCEL, arguing 1) The City of Poughkeepsie was not provided proper notice of the constitutional issue pursuant to C.P.L.R. §1012; 2) The constitutionality of the GCEL can only be adjudicated in Supreme Court as a declaratory judgment; 3) That even if this Court has jurisdiction to rule on the constitutionality of the GCEL, it should decline to do so, because petitioner has unclean hands; 4) Since this Court can decide the motion without passing on the constitutionality of the GCEL, it should decline to reach the constitutional issue of the GCEL; and 5) The GCEL is not preempted by state law, or in conflict with it.
V. PETITIONER'S OPPOSITION PAPERS TO THE CITY OF POUGHKEEPSIE'S DEFENSE OF THE GCEL
In opposition, petitioner argues that notice was provided to the City in accordance with C.P.L.R. § 1012; that this Court has jurisdiction to determine the constitutionality of the GCEL; that petitioner does not have unclean hands; that this Court should invalidate the GCEL; and that the GCEL is preempted by New York State Law.
LEGAL ANALYSIS AND CONCLUSION
As a preliminary matter, this Court is a court constitutionally enacted pursuant to the New York State Constitution [NY CONST. Art. IV, §17] with jurisdiction to adjudicate constitutional legal issues. People v. Jackson, 76 Misc.2d 872 affirmed 36 N.Y.2d 726 (1975 ); People v. Zongone, 102 Misc.2d 265 (Yonkers City Court 1979)(court held that NY disorderly conduct statute was constitutional); People v. Milio, 112 Misc.2d 949 (Yonkers City Court 1982) citing National Psych. Assn. et al v. University of State of NY, 18 Misc.2d 722, 725-26 affirmed 10 A.D.2d 688 affirmed 8 N.Y.2d 197 (court should declare statutes unconstitutional that affect life and liberty and where the invalidity of the statute is apparent on its face); People v. Jack Resnick and Sons, Inc., 127 Misc.2d 1031(Yonkers City Court 1985)(upholding local ordinance and finding that if the constitutional questions raised in a court of limited jurisdiction are debatable, the court must declare the ordinance constitutional, and must not substitute its judgment for that of the legislative body); People v. Trolio, 170 Misc.2d 1017 (Village of Scarsdale 1996)(finding code limiting leaf blowers constitutional).
Secondly, respondent incorrectly contends that petitioner is seeking declaratory relief from this Court. The instant proceeding was commenced by petitioner pursuant to R.P.A.P.L. § 711(1), and the constitutionality and enforceability of the GCEL is inextricably intertwined with the facts set forth within the instant summary proceeding and central to the issues.
Third, Corporation Counsel's Office was timely and properly notified pursuant to C.P.L.R. § 1012. There are no procedural timing requirements setting forth when or how notice must be provided under C.P.L.R. § 1012(b). Moreover, in local government challenges, there is nothing that even imposes the notice obligation on the party raising the constitutional issue. Rather it is only implied. The statutory requirement that a motion for intervention be "timely" under C.P.L.R. § 1012, adds an element of judicial discretion to the "right" to intervene. (Alexander Practice Commentaries, McKinney's Cons. Laws of NY, Book 7B, CPLR C102:5) "The principal guideposts in the valuation of timeliness are whether disposition of the action will be unduly delayed and whether the original parties will be prejudiced." Id. citing Norstar Apts., Inc. v. Town of Clay, 112 A.D.2d 750, 751 (4th Dept. 1985). Cf. C.P.L.R. 1013. See, e.g., Halstead v. Dolphy, 70 A.D.3d 639 (2d Dept. 2010)(intervention was not sought until more than four years from action's commencement). Here, once petitioner constitutionally challenged the GCEL, the parties were ordered by this Court that Corporation Counsel's Office was to be notified by petitioner and provided an opportunity to intervene. It is undisputed that notice was timely provided by petitioner to Corporation Counsel's Office, and undisputed that Corporation Counsel consented to the documentation being emailed. O'Fallon affirmation, dated January 23, 2022 [sic], ¶ 1-14. Petitioner complied with this Court's Order, Corporation Counsel intervened on behalf of the City of Poughkeepsie, their papers have been considered, and the parties have not demonstrated prejudice in any way. Halstead v. Dolphy, supra (holding that intervention may occur at any time provided it does not unduly delay the action or prejudice existing parties).
Fourth, Corporation Counsel's erroneous claim that it has been deprived of its right to appeal an adverse decision as an intervenor , is wrong. A successful intervenor acquires the same status as that of an original party. See, e.g., NY Central RR Co., v. Lefkowitz, 19 A.D.2d 548 (2d Dept. 1963)(holding that once intervenors become parties to an action, they are to all intents and purposes considered original parties); Halstead v. Dolphy, supra at 640; Berkoski v. Trustees of Inc. Village of Southampton, 67 A.D.3d 840 (2d Dept. 2009); Paez v. Varveris, 12 Misc.3d 101 (App. Term 2d Dept. 2006).
Longcore affirmation, dated January 4, 2023, footnote 2.
Fifth, the Court rejects the City's argument that petitioner has unclean hands.
Sixth, the Court rejects the City's argument that the motion should be decided without passing on the constitutionality of the GCEL. While courts must exercise judicial restraint, a court may not avoid a constitutional issue by interpreting a challenged statute in a manner that produces an absurd or unreasonable result. Matter of Shernise C., 91 A.D.3d 26 (2d Dept. 2011). Likewise, legislative enactments are to be construed so as to avoid constitutional issues if doing so is fairly possible. Matter of Waterways Dev. Corp. v. Town of Brookhaven Zoning Board of Appeals, 126 A.D.3d 708 (2d Dept. 2015). However, here, central to the proceeding, is the GCEL, and whether it is constitutional, or void and unenforceable. This Court cannot avoid addressing the legality surrounding the challenged statute without reaching an absurd result. A decision on this issue dictates the course of this proceeding. As such, the merits of the statute's constitutionality and enforceability are addressed below.
Finally, contrary to arguments made by Corporation Counsel [ Longcore affirmation, dated January 4, 2023, ¶ 29 ], the function of the judicial branch is not to render decisions that ensure public debate and outcry, nor is it to ensure input from the media. Indeed, its role and decisions must be insulated from such things. The judiciary must exercise fairness and impartiality in its decisions. It must protect the rights of individuals, ensure equal justice, interpret and apply the law, and be a guardian of the Constitution. As such, to the extent that the City argues that the Court should decline to exercise its power to rule on this issue for these reasons, same is wholly rejected.
The GCEL's constitutionality and enforceability
The general rule of law is that municipalities have the right to enact ordinances that tend to preserve good order, peace, health, and the safety and welfare of its inhabitants. Second Class Cities Law § 30; Poughkeepsie City Code § 1-2. Questions as to the wisdom, need, or appropriateness of the statute are to be left to the Legislature. Olsen v. Nebraska, 313 U.S. 236, 246 (1941). Moreover, courts are bound to construe statutes as they have been drawn and are not to review the expediency, wisdom or propriety of a Legislature's actions if such matters are performed within its powers. Lawrence Construction Corp. v. State of New York, 293 NY 634, 639 (1944).
And while municipalities have broad authority to enact legislation that promotes the welfare of their constituents, the New York State Constitution limits that power to local governments to the extent that they may not adopt laws inconsistent with the provisions of the Constitution or any general law relating to its property, affairs, or government. NY Const. art. IX, 2(c). Pusatere v. City of Albany, Sup. Ct. Albany Co., June 30, 2022, Ryba, S.C.J. Index No. 909653-21, citing NY Const. art. IX, 2(c); Municipal Home Rule Law 10(1)(i), (ii); Nyack v. Daytop Vill. Inc., 78 N.Y.2d 500, 505 (1991); see also, Albany Area Bldrs. Assn. v. Town of Guilderland, 74 N.Y.2d 372, 377 (1989).
There is a strong presumption that a legislative statute is constitutional, and its invalidity must be demonstrated by the party opposing it beyond a reasonable doubt. People v. Pagnotta, 25 N.Y.2d 333, 337 (1969). Only in rare cases should courts of the first instance - like here - find acts of the Legislature unconstitutional. People v. Zongone, supra citing People v. Mason, 99 Misc.2d 583, 587 (Richmond County 1979). Facial challenges to statutes are generally disfavored because legislative enactments carry a strong presumption of constitutionality. People v. Taylor, 9 N.Y.3d 129, 150 (2007). Moreover, the burden of proof in demonstrating that the statute is unconstitutional rests with the one who seeks to invalidate it. People v. Bright, 71 N.Y.2d 376, 382 (1988). And, in those instances, courts should declare statutes unconstitutional only as a last unavoidable resort. South Buffalo Ry. Co. v. Ahern, 303 NY 545, 555 affirmed 344 U.S. 367 (1953). Matter of Pratt v. Tofany, 37 A.D.2d 854 (2d Dept. 1971).
The Preemption Doctrine limits municipalities' law-making authority. People v. Torres, 37 N.Y.3d 256, 265 (2021) citing Albany Area Bldrs. Assn., supra. Specifically, "Conflict Preemption" prohibits a local government from adopting any laws inconsistent with state law, while "Field Preemption" prohibits a local government from legislating in a field or area of the law where the "legislature has assumed full regulatory responsibility." People v. Torres, supra; Matter of Highway Super. Assn. of Rockland, Inc. v. Town of Clarkstown, 150 A.D.3d 731, 734 (2017).
Here, this Court finds that the GCEL passed by the City of Poughkeepsie is void and unenforceable under the New York State Constitution because the GCEL is inconsistent with duly enacted New York State Laws on eviction proceedings. NY Const., Art. IX, 2; Albany Area Builders Assn. v. Town of Guilderland, 74 N.Y.2d 372, 377 (1989); People v. Torres, 37 N.Y.3d 256, 265 (2021). Under the legal doctrine of Conflict Preemption, the GCEL is preempted by numerous New York State Laws. Pusatere v. City of Albany, Sup. Ct. Albany Co., June 30, 2022, Ryba, S.C.J. Index No. 909653-21.
The City of Poughkeepsie Common Council's GCEL, adopted in 2021, prohibits landlords from evicting tenants except under special circumstances. For example, it prevents landlords from evicting tenants who refuse to pay rent if they consider rent increases to be "unconscionable" - otherwise described as "predatory" rent increases. Moreover, the GCEL imposes a "good cause" requirement to institute a summary eviction proceeding; and it caps rental increases to 5% annually.
Under the legal doctrine of "Conflict Preemption," the GCEL is inconsistent with New York State Real Property Law § 226-c - which authorizes evictions based upon an expired lease or non-renewal lease - in that the GCEL precludes a landlord from evicting a tenant without good cause.
Moreover, the GCEL is inconsistent with New York State Real Property Law § 226-c(1)(a) - which authorizes rental increases of greater than 5% provided the tenant is given appropriate statutory notice - in that the GCEL prohibits a landlord from increasing rent by 5% in any twelve-month period without good cause.
In addition, the GCEL is inconsistent with New York State Real Property Law § 228 - which authorizes a landlord to evict based upon expiration of a tenancy - in that the GCEL requires a landlord to establish good cause to evict someone even if the lease has expired.
As well, the GCEL is inconsistent with New York State Real Property Actions and Proceedings Law § 711(1) - which authorizes a landlord to evict a tenant based upon an expired lease - in that the GCEL requires a landlord to establish good cause to evict someone even if the lease has expired.
"Conflict Preemption" - once again - prohibits a local government from adopting a law inconsistent with state law, and here the GCEL is in direct conflict with R.P.L. § 226-c(1)(a) and R.P.L. § 228, as well as R.P.A.P.L. § 711(1), because it strips a landlord's New York State statutorily enacted right to terminate, or otherwise not elect to renew a tenancy, without good cause. Moreover, it prohibits a landlord from increasing rent by more than 5% annually without good cause. Since the City of Poughkeepsie Common Council is prohibited from enacting a law inconsistent with general laws of New York State, the GCEL is void and unenforceable.
Even if this Court found that the GCEL was valid - which it has not - while respondent has the benefit of a strong presumption set forth in the GCEL, that presumption is rebuttable. Here, petitioner set forth sufficient evidence in admissible form to rebut the presumption that would have defeated respondent's motion to dismiss. In addition, even if this Court found the GCEL to be valid and enforceable, issues of fact have been raised in the papers, including market analysis of current rentals in several nearby apartment complexes, that would have defeated the motion to dismiss. Notwithstanding same, this Court would have had to reach an absurd result by not addressing these constitutional issues.
A. Respondent's motion to dismiss pursuant to C.P.L.R. § 3211(a)(7 )
Respondent's motion to dismiss pursuant to C.P.L.R. § 3211(a)(7) on the grounds that the petition fails to plead good cause for the rental increase and violates C.P.L.R. § 3013, R.P.A.P.L. § 741 (4) and GCEL is denied as well. It is well established that on a motion to dismiss pursuant to C.P.L.R. § 3211(a)(7) for failure to state a cause of action, the court must afford the pleading a liberal construction, accept all facts as alleged in the pleading to be true, accord the plaintiff/petitioner the benefit of every possible inference, and determine only whether the facts as alleged fit within any cognizable legal theory. Goel v. Ramahandran, 111 A.D.3d 783 (2d Dept. 2013) citing Breytman v. Olinville Realty, LLC, 54 A.D.3d 703 (2008); Blake v. City of New York, 148 A.D.3d 1101 (2d Dept. 2017); see Sokol v. Leader, 74 A.D.3d 1180 (2010)(in considering a motion to dismiss pursuant to C.P.L.R. § 3211(a)(7), "the court must accept the facts as alleged in the complaint as true, accord plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory."). C.P.L.R. §3013 is to be liberally construed. Severino v. Salisbury Point Coop., Inc., 21 A.D.2d 813 (2d Dept. 1964). The burden of proof on a motion to dismiss made pursuant to C.P.L.R. § 3211(a)(7) rests with the moving party, and never shifts to the non-moving party. Whether the non-moving party can ultimately establish its allegations is not part of the calculus in determining a motion to dismiss, but rather the court is to determine only whether the facts as alleged fit within any cognizable legal theory. Zurich Am. Ins. Co. v. City of New York, 176 A.D.3d 1145 (2d Dept. 2019). Here, the petition pleads all of the facts necessary to fit into a legally cognizable theory for a non-payment summary proceeding, including non-payment of rent (which falls within the strictures of the GCEL). It sets forth the type of proceeding (non-payment), the parties, the demand, the premises specifically described, service of the predicate notices duly demanded, informs the Court that the respondent is still in possession, and provides a verification together with the necessary notices and affidavits of service.
The remaining issues raised by the parties are either deemed moot by the findings set forth herein or are issues of fact to be determined at the trial of this action.
THEREFORE, based upon all of the foregoing, and having duly deliberated upon same, it is NOW:
ORDERED, that respondent's motion to dismiss is DENIED; and it is further
ORDERED, that the GCEL enacted by the City of Poughkeepsie Common Council is deemed unconstitutional, thereby rendering it VOID and UNENFORCEABLE under New York State's "Preemption Doctrine"; and it is further
ORDERED, that respondent's application seeking return of the security deposit is denied at this time, with leave to renew said application at trial; and it is further
ORDERED, that respondent's application seeking alternative relief to preclude a rental increase over 5% is held in abeyance pending proof filed by petitioner within five (5) days of the date of this Order, that petitioner served respondent with a 90-day notice of the rental increase pursuant to R.P.L. § 226-c (2)(c), or the matter will be dismissed without further Order of this Court; and it is further
ORDERED, that upon the filing of petitioner's proof that a 90-day notice of rental increase was served upon respondent, the Clerk is directed to set the matter down for a trial.
SO ORDERED.
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