July 3, 2013
1872 MONROE AVENUE ASSOCIATES, Petitioner-Landlord,
Myasia COGLE, Respondent, Donovan Jackson Thornhill and Sharon Thornhill, Respondents-Undertenants-Occupants. No. 3596/13.
This decision has been referenced in a table in the New York Supplement.
ANDREW LEHRER, J.
Recitation, as required by CPLR 2219(a), of the papers considered in the review of petitioner's motion for an order dismissing or striking respondent Sharon Thornhill' succession rights defense:
| Petitioner's notice of motion, affirmation and exhibits || 1 |
| Respondent Sharon Thornhill's affirmation in opposition || 2 |
| Petitioner's reply affirmation and exhibits || 3 |
Petitioner 1872 Monroe Avenue Associates commenced this holdover proceeding against respondent Myasia Cogle and respondent-undertenants-occupants " John Doe" and " Jane Doe" in January 2013. The petition, as amplified by the predicate notice to cure dated November 23, 2012 and notice of termination dated December 18, 2012, alleges, among other things, that the subject apartment is Rent Stabilized; that Ms. Cogle is the tenant of the apartment; and that she has violated a substantial obligation of her tenancy by subletting or assigning the apartment to " John Doe" and/or " Jane Doe" without petitioner's written permission, and by failing to cure that breach of her lease by December 10, 2012, the deadline set forth in the notice to cure.
After several missing several court dates, Myasia Cogle, who is not represented by counsel, appeared on May 29, 2013 but did not file an answer. Accordingly, her answer shall be deemed to be a general denial.
On April 24, 2013, Sharon Thornhill, who is represented by counsel, was substituted as a respondent in place of Jane Doe. Although she did not file a written answer, she asserted a defense of succession rights to the apartment on that date.
Because Ms. Thornhill represented that Donovan Jackson Thornhill, who is 16 years old, also resides in the apartment and has a succession rights defense, on May 8, 2013 the Hon. Jaya Madhavan appointed a guardian ad litem for him. Although his guardian has not filed a written answer, the Court will allow her to assert a succession rights defense on his behalf. In addition, the Court orders that he (Mr. Thornhill) be substituted as a respondent in place of " John Doe."
By notice of motion dated May 5, 2013, petitioner moves for an order pursuant to Section 3211(b) of the CPLR dismissing or striking Sharon Thornhill's succession rights defense, claiming that such defense is barred by res judicata. Ms. Thornhill opposes the motion and has submitted papers in opposition thereto. Neither Myasia Cogle nor Donovan Jackson Thornhill has expressed a position on petitioner's motion.
The essential facts underlying petitioner's motion are not in dispute. In November 2009 petitioner commenced a licensee holdover proceeding against " John Doe" and " Jane Doe," alleging that their license to occupy the subject apartment terminated upon the death of the tenant of record, Eleanor Jackson, on or about August 15, 2009. Subsequently, Sharon Thornhill, Donovan Jackson, and Myasia Cogle were substituted as respondents in place of " John Doe" and " Jane Doe."
Although no answers are contained in the court file, a motion for discovery filed by petitioner indicates that discovery was needed to explore " the respondents' claims to succession rights."
On April 9, 2010, the parties signed a stipulation settling the licensee proceeding. In that stipulation, petitioner agreed to provide Myasia Cogle with a new Rent Stabilized vacancy lease and Ms. Cogle agreed to sign the lease and pay petitioner $4,519.66 for past due use and occupancy. The stipulation further provided that " [u]pon compliance herein [ sic ] the case will be discontinued as to Kadeem Jackson-Thornhill and Sharon Thornhill" but upon default, petitioner could move for a judgment and warrant. It was signed by petitioner's attorney, Myasia Cogle, Sharon Thornhill, and Ms. Thornhill's attorney, and was so-ordered by the Resolution Part judge.
On June 15, 2010, petitioner's attorney, Ms. Cogle, Ms. Thornhill, and Ms. Thornhill's attorney signed a stipulation settling petitioner's motion for a final judgment. It provided that petitioner would give Ms. Cogle a new Rent Stabilized lease for a two-year term commencing July 1, 2010, at a rent of $775.00 per month; that petitioner would provide Ms. Cogle with the lease and certain other documents for her to sign on or before July 1, 2010; and that Ms. Cogle would return the lease and the other documents to petitioner by July 15, 2010. The so-ordered stipulation further provided that " [u]pon compliance of [ sic ] the above terms, the case will be discontinued."
Petitioner argues that because Ms. Thornhill asserted a succession rights defense in the licensee proceeding and, along with her attorney, signed a settlement stipulation which only permitted Myasia Cogle to succeed to Eleanor Jackson's tenancy, she is barred by res judicata from asserting a succession claim in this proceeding. Ms. Thornhill argues, in opposition, that she is Eleanor Jackson's sister; that she moved into the subject apartment in 2001 to take care of her; that after Ms. Jackson passed away, she became the guardian of Ms. Jackson's grandchildren, Ms. Cogle and Donovan Jackson Thornhill; that the stipulation settling the licensee proceeding made no mention of her waiving or withdrawing her succession rights claim; that the stipulation did not state that only Myasia Cogle was entitled to succeed to Ms. Jackson's tenancy; and that in any event, she is entitled to assert a claim that she has a right to succeed to Ms. Cogle's tenancy.
The doctrine of res judicata holds that " as to the parties in a litigation and those in privity with them, a judgment on the merits by a court of competent jurisdiction is conclusive of the issues of fact and questions of law necessarily decided therein in any subsequent action." ( Gramatan Home Invs. Corp. v. Lopez, 46 N.Y.2d 481, 485  ). It applies both to matters actually litigated in the first case and to matters which might have been litigated therein. ( See Israel v. Wood Dolson Co., 1 N.Y.2d 116, 118  ).
Generally, res judicata does not apply where the first action concluded without the entry of a judgment. ( See Morrison-Knudsen Co. v. Continental Cas. Co., 181 A.D.2d 500, 501 [1st Dept 1992]; Peterson v. Forkey, 50 A.D.2d 774 [1st Dept 1975] ). Thus, with limited exceptions, where a case is settled before judgment, there is no res judicata effect ( see Morrison-Knudsen Co. v. Continental Cas. Co., supra, 181 A.D.2d at 501; Ott v. Barash, 109 A.D.2d 254, 262 [2d Dept 1985], and the action is " considered, in contemplation of law, as if it had never been begun." ( Peterson v. Forkey, supra, 50 A.D.2d at 775, citing Yonkers Fur Dressing Co. v. Royal Ins. Co., 247 N.Y. 435, 444  ). That being said, res judicata may apply to a stipulation of settlement without a judgment if it discontinues a claim with prejudice ( see e.g. Matter of State of New York v. Seaport Manor A.C.F., 19 A.D.3d 609, 610 [2d Dept 2005]; Singleton Mgt. v. Compere, 243 A.D.2d 213, 216 [1st Dept 1998], or contains factual or legal findings ( see 37-01 31st Ave. Realty Corp. v. Safed, 20 Misc.3d 762, 767 [Civ Ct, Queens County 2008], appeal dismissed 28 Misc.3d 58 [App Term, 2d, 11th and 13th Jud Dists 2010]; 73A N.Y. Jur 2d, Judgments § 389 [2d ed] ).
Ebanks v. 547 W. 147th St. Hous. Dev. Fund Corp., 37 A.D.3d 290 (1st Dept 2007), cited by petitioner in support of its motion, does not stand for the proposition that res judicata applies, in the absence of a judgment, to a stipulation that neither settles a claim with prejudice nor contains factual or legal findings. In Ebanks, a housing cooperative signed a stipulation settling a nonpayment proceeding that it had commenced against Section 8-subsidized tenant-shareholders by agreeing that they need pay only their share of the arrears. It also agreed that it would not seek a judgment of possession based on the Section 8 arrears owed by the Department of Housing Preservation and Development (" HPD" ). After the cooperative subsequently served the tenants with a notice of lien foreclosure, which was based on unpaid maintenance that consisted primarily of the Section 8 arrears owed by HPD, the tenants commenced a proceeding to nullify the notice. In affirming the Supreme Court's order and judgment granting the petition, the First Department held that because the stipulation settling the nonpayment proceeding resolved the tenants' maintenance obligations through the settlement date, res judicata barred the cooperative from commencing a subsequent proceeding to recover the same arrears. Although the court's opinion does not indicate whether the settlement stipulation discontinued with prejudice the cooperative's claim against the tenants for maintenance owed in excess of their share of the arrears, the court cited Fifty CPW Tenants Corp. v. Epstein, 16 A.D.3d 292 (1st Dept 2005) in support of its holding. In that case, the court held that a stipulation discontinuing a party's claim with prejudice had res judicata effect.
67-25 Dartmouth St. Corp v. Syllman, 29 A.D.3d 888 (2d Dept 2006), also cited by petitioner in support of its motion, is clearly distinguishable from the facts of this case. That case involved the res judicata effect of a housing cooperative's failure to assert a counterclaim for attorneys fees in an action that a shareholder had commenced against it. In affirming the Supreme Court's order granting summary judgment dismissing the complaint in the cooperative's subsequent action seeking attorneys fees, the Second Department held that although there are no compulsory counterclaims, that " does not ... permit a party to remain silent in the first action and then bring a second one on the basis of a preexisting claim for relief that would impair the rights or interests established in the first action." ( 29 A.D.3d at 889-890, quoting Henry Modell & Co. v. Minister, Elders & Deacons of Ref. Prot. Dutch Church of City of NY, 68 N.Y.2d 456, 462 n.2  ). Permitting Ms. Thornhill to assert a succession rights defense in this case will not impair any of the rights or interests established in the licensee proceeding.
Neither the April 2010 stipulation settling petitioner's licensee proceeding nor the June 2010 stipulation settling petitioner's motion for a final judgment in that case included a final judgment with respect to Ms. Thornhill's succession rights claim or otherwise, and neither one discontinued Ms. Thornhill's succession rights claim with prejudice or contained any factual or legal findings with respect to that claim. And while those stipulations granted tenancy rights only to Ms. Cogle, neither one expressly stated that only Ms. Cogle was entitled to succeed to Ms. Jackson's tenancy. Consequently, the stipulations settling the licensee proceeding have no res judicata effect with respect to Ms. Thornhill's claim that she has a right to succeed to Ms. Jackson's tenancy and do not bar her from asserting such a claim in this proceeding. Moreover, even if she were precluded from doing so, she may still assert a claim to succeed to Myasia Cogle's tenancy.
Accordingly, petitioner's motion to dismiss or strike Ms. Thornhill's succession rights defense is denied. This case is restored to the Part T calendar for trial on August 8, 2013 at 9:30 a.m.
This constitutes the decision and order of the Court.