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P & T Management Co., LLC v. Georgina Galanis

SUPREME COURT OF THE STATE OF NEW YORK APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS


August 4, 2011

P & T MANAGEMENT CO., LLC,
RESPONDENT,
v.
GEORGINA GALANIS,
APPELLANT.

Appeal from an order of the Civil Court of the City of New York, Queens County (Ronni Dale Birnbaum, J.), dated March 5, 2010.

P & T Mgt. Co., LLC v Galanis

Appellate Term, Second Department

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 Miscellaneous Reports.

Decided on August 4, 2011

PRESENT: WESTON, J.P., PESCE and RIOS, JJ

The order denied tenant's motion, in effect, to stay execution of a warrant of eviction.

ORDERED that the order is reversed, without costs, and tenant's motion to, in effect, stay execution of the warrant of eviction is granted.

In this chronic-nonpayment holdover proceeding, the parties entered into a so-ordered stipulation of settlement providing for the payment of arrears and establishing a one-year probationary period, during which the rent had to be paid by the fifth of each month. The stipulation also provided, however, that tenant "may pay the rent by the 10th day of the month on no more than 2 occasions." Upon default of any payment, the stipulation stated, the warrant of eviction "may be accelerated on an affidavit of default."

Prior to the due date of the first periodic payment under the stipulation, tenant had paid all of the outstanding rental arrears, totaling four months' rent. Then, on January 14, 2010, tenant submitted the first periodic payment, which was due by no later than the 10th of the month. Based on that one late payment, landlord served her with a marshal's notice. Tenant moved to stay execution of the warrant, which the Civil Court denied. We reverse.

At the time of tenant's motion, tenant had substantially complied with the stipulation by making the January 2010 payment, which could have been made as late as January 10th, by January 14th. Tenant stated that the additional four-day delay was not willful, but was, instead, based upon her misunderstanding that the stipulation allowed two "late" payments (see e.g. 421 W. 22 LLC & 421 W. 22B LLC v Walberg, 30 Misc 3d 136[A], 2011 NY Slip Op 50171[U] [App Term, 1st Dept 2011]; cf. e.g. 175 E. Parkway Assoc. v Baptiste, 31 Misc 3d 138[A], 2011 NY Slip Op 50767[U] [App Term, 2d, 11th & 13th Jud Dists 2011]). Although tenant's understanding of the stipulation was incorrect, the stipulation did contemplate that tenant would be allowed some flexibility in two payment dates. Moreover, tenant had previously paid all of the arrears, and subsequently attempted to pay the February rent on time. In addition, we note that the stipulation did not provide that no default in payment during the probationary period could be considered de minimis (cf. e.g. 175 E. Parkway Assoc., 31 Misc 3d 138[A], 2011 NY Slip Op 50767[U]; Monroe Place Assoc. v Arango, 28 Misc 3d 130[A], 2010 NY Slip Op 51251[U] [App Term, 2d, 11th & 13th Jud Dists 2010]).

As tenant's default was not repeated or unexplained (cf. e.g. M & R Realty Co., LLC v Brumfeld, 28 Misc 3d 139[A], 2010 NY Slip Op 51537[U] [App Term, 1st Dept 2010]), but was, instead, based upon confusion regarding the stipulation, we find that it should have been excused (see e.g. 421 W. 22 LLC & 421 W. 22B LLC, 30 Misc 3d 136[A], 2011 NY Slip Op 50171[U]). Accordingly, the order is reversed, and tenant's motion, in effect, to stay execution of the warrant of eviction is granted.

Pesce and Rios, JJ., concur.

Weston, J.P., dissents in a separate memorandum.

Weston, J.P., dissents and votes to affirm the order in the following memorandum:

In my view, the Civil Court acted well within its discretion in refusing to excuse tenant's lateness in making payment pursuant to the terms of the probationary stipulation settling this chronic-nonpayment holdover proceeding (see M & B Lincoln Realty Corp. v Lubrun, 4 Misc 3d 129[A], 2004 NY Slip Op 50668[U] [App Term, 2d & 11th Jud Dists 2004]). Accordingly, I respectfully dissent and vote to affirm.

It is well established that stipulations of settlement "are favored by the courts and not lightly cast aside" (Hallock v State of New York, 64 NY2d 224, 230 [1984]). "Only where there is cause sufficient to invalidate a contract, such as fraud, collusion, mistake or accident, will a party be relieved from the consequences of a stipulation made during litigation" (id.).

Here, tenant offered no valid excuse for her failure to honor the terms of the so-ordered probationary stipulation. After facing four nonpayment proceedings within an 18-month period, tenant negotiated a binding stipulation of settlement whereby she agreed to pay use and occupancy no later than the fifth day of each month, and no later than the tenth day of the month "on no more than 2 occasions." Less than a month later, tenant was late tendering her very first payment under the probationary stipulation. Although the majority notes that tenant was entitled to two late payments under the stipulation, the stipulation nevertheless made clear that any late payment was to be tendered no later than the tenth day of the month. By tendering payment on the fourteenth day of the month, tenant could hardly be considered to have "substantially complied" with the stipulation, especially where she had a history of chronic nonpayment. Indeed, tenant's failure to abide by the stipulation from its inception evinces a complete disregard of its terms. Nor should tenant's noncompliance be excused by the fact that the stipulation did not contain a provision that no default would be considered de minimis. Nothing in the law requires the presence of such language to uphold the validity of a stipulation. To conclude otherwise, as the majority does, would permit some tenants to evade the consequences of a binding stipulation and discourage landlords from ever entering into stipulations without the inclusion of such language. Since tenant failed to tender payment pursuant to the terms of the stipulation, and there is no basis in law to excuse her failure, the Civil Court properly denied tenant's motion to stay the execution of the warrant of eviction (see Chelsea 19 Assoc. v James, 67 AD3d 601 [2009]).

Accordingly, I vote to affirm the Civil Court's order. Decision

Date: August 04, 2011

20110804

© 1992-2011 VersusLaw Inc.



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