Petitioner, Ruradan Corp., commenced this lease-expiration holdover proceeding against Michelle Natiello ("respondent") on the premise that the apartment she occupies, 8 East 48th Street Apt 4D, is not subject to rent regulation. Respondent answered the petition by asserting the following claims: (1) a defense and counterclaim that the subject premises is subject to rent regulation thereby requiring petitioner to offer a renewal lease; (2) that the premises was wrongfully removed from rent stabilization based on unlawful rent increases; (3) a defense and counterclaim of breach of warranty of habitability; (4) a defense and various counterclaims of rent overcharge; (5) and a counterclaim for attorney's fees.

Respondent now moves for summary judgment or, in the alternative, for leave to conduct discovery. Petitioner cross-moves to strike respondent's first, second and third affirmative defenses and all of her counterclaims. Petitioner further seeks summary judgment and a hearing to determine fair market use and occupancy for the subject apartment. These motions are consolidated for disposition.

The substance of the respective motions herein relates to whether or not respondent has presented a viable defense to petitioner's claim that the subject apartment is not covered by rent regulation. Respondent, in the form of an affidavit, claims that the subject building had a nefarious past in that it was used as a den of prostitution and drug activity and that in addition to said activity, apartments, including her's, were illegally removed from rent regulation. Respondent's assertions are based on a newspaper article about the apartment building, conversations with fellow tenants and Division of Housing and Community Renewal ("DHCR") rent registration filings which she contends raise red flags.

Respondent shows that she moved into the subject apartment in March 2002 after signing a non-regulated lease with a $1,350 monthly rent. The DHCR registration at that time indicated that [*2]respondent was a rent stabilized tenant with a rent of $1,400 per month. The prior rent stabilized tenant, Iris Melo, had a lease from August 1999 through July 2001 and paid a preferential rent of $1,500 which was below the rent stabilized rent of $1,619.90. The preceding tenant, Marcelo Caruso, had a rent stabilized lease from August 1997 through July 1999 with a rent of $1,349.92. This rent amount included an allowance for improvements that were done after the prior vacancy. Marcelo Caruso also happened to be the listed tenant of Apartment 3B from April 1998 through 2001 with a preferential rent of $1,500 a month during that time frame. According to respondent, the preceding tenants Caruso and Melo are mother and son and were possibly involved in the building's ill-refuted past.

On May 7, 2008, petitioner amended the DHCR rent registration filings to reflect the correct rent for respondent's apartment in 2002 as $2,017.63, based on a vacancy increase and recouped renovation costs, thereby making the premises luxury deregulated. In support of the amendment, petitioner submitted the 2002 rider to respondent's lease that reflected this rental amount and a letter it purported to have sent DHCR in 2003 asking to correct the filing errors its predecessor had made for the building.

Petitioner argues that based on the amended filings and the actual lease signed by respondent, the premises are not subject to rent regulation. Petitioner further contends that regardless of respondent's claims, she is barred from pursing said claims pursuant to CPLR 213-a which prohibits examination of rental records beyond "the four year period immediately preceding the commencement of the action" for claims of rent overcharge. However, this latter argument is flawed as this proceeding is about possession — making any claim of rent overcharge only ancillary (see Bedford Apts. Co. v Lewison, 4 Misc 3d 139[A] [App Term 1st Dept 2004] [statutes that preclude examination of rental history beyond four years address an "action" or "complaint" for rent overcharge, not a possessory proceeding for eviction]). Contrary to respondent's arguments, this court is by no means precluded from reviewing the history, spanning a reasonable time frame, of a tenancy in order to determine whether the premises is subject to rent regulation. This is the precise holding of the Appellate Division in East West Renovating Co. v New York State Div. of Housing and Community Renewal, (16 AD3d 166, 167 [1st Dept 2005]), where the Court stated that "consideration of events beyond the four-year period is permissible if done not for the purpose of calculating an overcharge but rather to determine whether an apartment is regulated" (see also Tribeca M. Corp v Haller, 11 Misc 3d 133[A] [App Term 1st Dept 2006] [four year statute of limitations not applicable beyond scope of calculating rent overcharge]; 286 Clinton LLC v Lazarre, 18 Misc 3d 1101[A] [Kings County Civ Ct 2007] [consideration of events beyond four year period is permissible if done for purpose of determining whether the premises is subject to rent regulation]; cf. Thornton v Baron, 5 NY3d 175 [2005] [Court of Appeals affirmed the use of DHCR "default formula" to calculate rent when no viable rent records exist based on applicability of CPLR 213-a]).^[FN1] [*3]

As it is apparent that CPLR 213-a does not bar review of the rental history for purposes of determining whether the premises are in fact subject to rent regulation, the court turns to the issue of whether petitioner is otherwise entitled to summary judgment.

In an effort to rebut petitioner's claim for summary judgment, respondent has presented affidavits as well as inconsistent DHCR filings which she states demonstrates that the subject apartment may have wrongly been removed from rent regulation. Under, CPLR 3212 (f):

"Should it appear from affidavits submitted in opposition to the motion that facts essential to justify opposition may exist but cannot then be stated, the court may deny the motion or may order a continuance to permit affidavits to be obtained or disclosure to be had and may make such other order as may be just."

As further discussed herein, respondent has raised a viable claim that the subject premises may have been wrongfully removed from rent regulation that justifies denying summary judgment pursuant to CPLR 3212 (f), at this juncture. Respondent has supported her claim with an affidavit and documents as to the basis for this belief. However, the pertinent information that could support this claim still remains solely in the hands of petitioner. As such, both sides' motions for summary judgment are denied with leave to renew after discovery is completed.

As indicated above, and consistent with CPLR 3212(f), the court finds discovery is appropriate under these unique circumstances. Respondent has set forth a good faith argument that the premises may in fact be subject to rent regulation. However, any information that may exist to further support said claim the prior use of the premises and related unit, recouped renovations prior to occupancy, rent history lies solely in the hands and control of petitioner (cf. Herman v Lancaster, NYLJ, 3/27/91, 22:6 [Civ Ct, New York County][respondent demonstrated ample need for discovery concerning propriety of recouped cost of improvements made to an apartment during vacancy period as said information was solely in the hands of the landlord]).^[FN2] As such, the matter is ripe for discovery before proceeding on the summary judgment motions (cf. Schwartz v Seidman, NYLJ 5/8/2002 [Civ Ct, New York County] [good faith claim of defenses that are central to the issues of the case and where information in regard to said claims is in the control of the other party is grounds for leave to conduct discovery in a summary proceeding]).

The court further, in determining the appropriateness of discovery in this proceeding, finds that petitioner is not unduly prejudiced by granting disclosure. The relevant information sought involves the immediate period before respondent took occupancy as well as the occupancies of the [*4]different family members who occupied her apartment and apartment 3B. This period covers 1997 through 2002. As evident from petitioner's opposition papers, the same superintendent is still employed at the premises and he has first hand knowledge of, inter alia, what work was performed in the subject apartment before respondent's occupancy. However, to further avoid any semblance of prejudice, the court directs respondent to pay use and occupancy at the last lease amount pendente lite commencing August 2008 by the 10th of each month. Respondent is further directed to become current on any post-petition arrears at the last lease amount within 20 days of service, with notice of entry, of this order. All payments are without prejudice to each side.

As the requested information, as set forth in Exhibit K is patently overly broad, the court in an exercise of discretion and for the sake of economy, is paring down the request to a more appropriate time frame 1997-2003 and to cover only apartments 4D and 3B. Any information sought beyond this is clearly a fishing expedition.^[FN3] Petitioner is directed to comply with the above limited document request within 30 days of service of a copy of this order with notice of entry. Petitioner is further directed to submit to a deposition within 45 days.

Petitioner's motion to strike respondent's counterclaims and first, second and third affirmative defenses is denied with leave to renew after discovery. The defenses largely all turn on the rent regulatory status of the apartment an issue that the court has determined needs to be subject to discovery before proceeding any further. To the extent that respondent has set forth a breach of warranty of habitability defense and counterclaim, that aspect of the answer is properly raised in response to petitioner's claim for use and occupancy (see King Enterprises Ltd. v Mastro, 2001 NY Slip Op 40162[U] [Civ Ct, New York County 2001] [although breach of habitability is not a defense to possession, it may be raised in a holdover proceeding to the extent that petitioner also seeks payment of use and occupancy]).

Accordingly, the motions for summary judgment and the motion to strike portions of the answer are denied with leave to renew pursuant to CPLR 3212(f). Petitioner is directed to comply with the discovery demand within 30 days and submit to a deposition within 45 days of service of this order with notice of entry. Respondent is directed to pay any outstanding post-petition use and occupancy arrears at the last lease amount, without prejudice to each side, within 20 days of service of this order with notice of entry. Respondent is further directed to pay use and occupancy by the tenth of each month pendente lite. The matter is marked off calender pending discovery and may be restored by stipulation or motion.This constitutes the decision and order of this court.

Dated: July 22, 2008____________________

New York, New YorkDavid J. Kaplan, J.H.C.

[*5]Attorney for Petitioner

Eric Kahan, Esq.

Sperber Denenberg & Kahan, P.C.

48 West 37th Street, 16th Floor

New York, New York 10018

(917) 351-1335

Attorney for Respondent

Robert Jay Gumenick, Esq.

Law Office of Robert Jay Gumenick

160 Broadway, Suite 1100

New York, New York 10038

(212) 608-7478