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SITC Inc. v. Riverplace I Holding LLC

December 30, 2008

SITC INC., PETITIONER
v.
RIVERPLACE I HOLDING LLC, RESPONDENT.



The opinion of the court was delivered by: Sabrina B. Kraus, J.

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and subject to revision before publication in the printed Official Reports.

BACKGROUND

These consolidated summary proceeding were commenced by SITC INC. ("Petitioner") who seeks to be restored to possession of Apartments 2902, 1019, 1420 and 2929 at 1 River Place , New York, New York 10036 ("Subject Premises") based on allegations that RIVERPLACE I HOLDINGS LLC ("Respondent"), the landlord and owner of the Subject Premises had illegally locked Petitioner out of possession. The proceedings were initiated by Order to Show Cause on December 18, 2008.They were consolidated for joint determination on consent of both parties on the return date.*fn1 A hearing was held on December 19, 2008, after which the Court ruled that Petitioner had been wrongfully ousted of possession, but reserved decision on the issue of Petitioner's request to be restored to possession.

FACTS

Petitioner is the tenant of record for twenty rent-stabilized apartments at the subject building, pursuant to written lease agreements and riders. All of the applicable lease agreements for the Subject Premises have expired, and have not since been renewed.

The Leases executed between the parties were Standard Form of Apartment Leases, issued by The Real Estate Board of New York, form number A1/88/A .

Article 1 of the leases provides that the Subject Premises shall be used for living purposes only, and only by Petitioner or its immediate family. Article 1 is supplemented by a rider to the Leases, which provides in Article 33 that only Petitioner, its immediate family members, and persons authorized to occupy the premises pursuant to RPAPL § 235 (f) may occupy the Subject Premises. Article 33 further provides a space to list the identity of the occupants, which is left blank. Article 33 (B) of the rider provides that the Subject Premises shall be occupied by Petitioner and its customers.

The Leases also have annexed a Corporate Occupancy Rider, which provides that Petitioner shall designate the party who shall be the initial occupant of the Subject Premises to Respondent, that Petitioner shall have the right to designate up to four other parties to occupy the Subject Premises upon said notice, and that Petitioner may not permit anyone to occupy without such notice.

Article 16 of the Leases contains the usual proscriptions against subletting and assignment.

Article 17(3) of the Leases provides that if Petitioner defaults in the payment of rent, after a personal demand for rent has been made, or within three days after a statutory demand for rent has been made, or if the lease ends, Respondent may re-enter the Subject Premises and take possession, if Petitioner has moved out.

The Leases were executed by David Drake, also known as David Drakeburg, on behalf of Petitioner, who testified that he is the owner Petitioner. Mr. Drake runs a company that appears to offer short term housing to its clients, and was apparently using the Subject Premises for that purpose.

Mr. Drake testified that Petitioner rented apartments for corporate clients who required furnished apartments. Mr. Drake referred to all occupants as his "clients". He acknowledged familiarity with a corporate entity known as Drake Corporate Relocation. Mr. Drake testified that he was related to that entity, and that Drake Corporate Relocation leases apartments from Petitioner.

Mr. Drake testified that the Subject Premises were not advertised for rental on the internet, and that they were not rented as hotel units. Mr. Drake testified that as far as he was aware, none of the occupants were charged hotel tax. Mr. Drake's testimony was evasive and not credible.

Notably in one email correspondence offered into evidence, Elinor McMurtrie, "Operations Coordinator" for "Drake Corporate Housing" sent an email, in reference to two apartments rented by Petitioner in the subject building, which read "Please ...


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