Rashid v. Cancel

In our view, the use of the basement as a sixth housing accommodation over a multi-year period brought the entire building under rent stabilization (Matter of Gandler v Halperin, 232 AD2d 637 [1996]; Commercial Hotel v White, 194 Misc 2d 26 [App Term, 2d & 11th Jud Dists 2002]; 109 Graham Ave. Corp. v Espinal, NYLJ, May 17, 1988 [App Term, 2d & 11th Jud Dists]; see Rosenberg v Gettes, 187 Misc 2d 790 [App Term, 1st Dept 2000]; cf. Matter of Gracecor Realty Co. v Hargrove, 90 NY2d 350 [1997]; White Knight Ltd. v Shea, 10 AD3d 567 [2004]). The alleged subsequent reduction in the number of housing accommodations to fewer than six, even if done, as landlord claims, after the placement by the Department of Housing Preservation and Development of a violation, did not exempt the remaining units from rent stabilization (Matter of Ki Wai Leung v Div. of Hous. & Community Renewal of State of N.Y., 266 AD2d 545 [1999]; Matter of Zandieh v Div. of Hous. & Community Renewal of State of N.Y., 249 AD2d 553 [1998]; Matter of Shubert v New York State Div. of Hous. & Community Renewal, 162 AD2d 261 [1990]; Rosenberg v Gettes, 187 Misc 2d 790, supra; El-Nazer v Briggs, NYLJ, Dec. 8, 1992 [App Term, 2d & 11th Jud Dists]; Fleur v Croy, 139 Misc 2d 885 [1988]; but see Matter of Gionta v New York State Div. of Hous. & Community Renewal, 155 Misc 2d 669 [1992]). If, as landlord claims, he was unaware, when he purchased the building, that the basement had been used as a housing accommodation, landlords remedy, if any, would lie against the prior owner. However, landlords alleged lack of knowledge does not give rise to an exemption from rent stabilization since landlord acquired the building "subject to those rights and protections enjoyed by the buildings tenants at the time of acquisition" (525 Park Ave. Assoc. v DeHoyas, 125 Misc 2d 432 [1984]; see Elwick v Howard, NYLJ, May 16, 1984 [Sup Ct, NY County], affd 111 AD2d 73 [1985], affd 65 NY2d 1006 [1985]; Friedman v Babic, 118 Misc 2d 565 [App Term, 1st Dept 1983]). Landlords conclusory claim of a substantial rehabilitation fails in the absence of the requisite proof of the replacement of building-wide and apartment systems (Rent Stabilization Code [9 NYCRR] § 2520.11 [e]; Cassorla v Foster, 2 Misc 3d 65 [App Term, 1st Dept 2004]).