In Manhattan Avenue Associates v. Naya McSwain, a previous case with a different petitioner but the same respondent, this court dismissed the proceeding for lack of standing under RPAPL 721 because petitioner, Manhattan Avenue Associates, was an improper party to maintain a summary proceeding. Manhattan Avenue Associates was not a named party to the Section 8 Housing Assistance Payments Program lease, despite being the owners of the residential property at issue.

Petitioner in this proceeding, Met Realty Group, is a managing agent of Manhattan Avenue Associates and also the party to the above lease entered into by respondent McSwain. In this proceeding, petitioner commenced a holdover on grounds identical to its holdover in Manhattan Avenue Associates v. Naya McSwain. Petitioner hopes to rectify the procedural defects extant in that prior proceeding by naming petitioner as the proper party — the entity whose name appears on the lease.

Respondent now contends that even though petitioner is the identified party as written on the lease between petitioner and respondent, petitioner again lacks the requisite standing to maintain this proceeding. According to respondent, petitioner is not an owner of the premises and, thus, has no property interest. Respondent notes that petitioner is merely a managing agent for Manhattan Avenue Associates, the property's true owner.

Residential leases entered into under a Section 8 Housing Assistance Payments Program like the one here are governed by Housing and Urban Development (HUD) regulations. These [*2]regulations provide definitions to interpret Section 8 lease terms. To understand the meaning of a term of a Section 8 residential lease, a court must apply the definitions provided in the regulations to the Section 8 lease.

HUD regulations provide that an "owner" is the proper party to enforce rights under the lease: "the provisions of this section apply to all decision by an owner to terminate the tenancy of a family." The use of the word "owner" rather than "landlord" is significant. Throughout HUD regulations are consistent applications of "owner" rather than "landlord" that outline respective rights of lessors and lessees. The use of parties other than the "owner" to contract with tenants is subject to strict HUD oversight.. This court can reasonably infer that parties other than "owners" have been granted different rights regarding Section 8 subsidized leases. An example of oversight requiring HUD approval is the right to contract with a managing agent to carry out the lease, which, as applied here, is both factually and legally significant. (See 24 CFR § 880.601.) Accordingly, only "owners" of Section 8 subsidized leased premises are granted the rights under HUD regulations. These rights may not be assigned without prior HUD approval.

A "landlord" or "lessor" may bring a summary proceeding. The terms "landlord" and "lessor" have been further defined in Redhead v Henry (160 Misc 2d 546, 547 [Civ Ct, Kings County1994]) as those who "possesse[s] . . . ownership in an estate in land." Accordingly, one must own a fee interest in the property and have the right to assign the fee interest — in this case, a leasehold — to be a tenant. A party without the necessary possessory interest may not be a party to a summary proceeding. More specifically, a non-owner without a possessory interest in a Section 8 subsidized housing lease may not be a proper party to a summary proceeding.

A petition commenced by a party without the requisite standing must be dismissed. (Cf. Ferber v Salon Moderne, Inc., 174 Misc 2d 945, 946 [App Term 1 st Dept 1997] [noting that respondent in that case, unlike respondent here, challenged petitioner's title and ownership].) This proceeding was commenced by Met Realty Group, which is not the owner of the leased premises, but it granted a leasehold interest to respondent without holding any fee rights. Both sides agree that petitioner is a managing agent of Manhattan Realty Associates, the actual owner of the premises. Both sides also agree that Manhattan Avenue Associates entered into a contract with petitioner granting petitioner the right, among other management rights, to enter into leases on Manhattan Avenue Associates' behalf.

Whether petitioner is a proper party to this proceeding boils down to whether the contract between the Manhattan Realty Associates involved a conveyance of a real-property rights.

Although the owner granted petitioner management rights, including the authorization to grant leases and enforce them by collecting rents, that transfer of rights does not amount to a transfer of any property interest to petitioner sufficient to create an ownership interest that confers standing to maintain this proceeding for a Section 8 housing lease. Hiring a management agent to manage a property does not make the managing agent the owner of the property. Agents are not owners of their principal's property, even with regard to property involved within the [*3]scope of the agency. The management agreement in this case between petitioner and Manhattan Avenue Associates provided as much in paragraph 9: "nothing contained in this agreement shall be deemed to create or shall be construed as creating in Agent any property interest in or to the Buildings."

Petitioner was in privity of contract of the lease with respondent insofar as the parties' names and signatures can be found on the lease document. But because petitioner has no possessory interest in the property, petitioner is in not in privity of estate with respondent. Instead, Manhattan Avenue Associates is the actual owner of the property in question and, thus, is in privity of estate with respondent. Petitioner here is not the landlord or lessor in the sense of owning a fee interest. It is barred under RPAPL 721 from maintaining this summary proceeding. Petitioner is only a lessor in the sense that petitioner's name is on the lease contract, but petitioner, as a managing agent, entered into the lease on behalf of Manhattan Avenue Associates and bound Manhattan Avenue Associates to the lease with respondent. Assigning a right to contract on one's behalf is different from assigning a right to property subject to such a contract. If one characterizes the contract between Manhattan Avenue Associates and petitioner as an assignment of a property interest, petitioner would become more than a managing agent of the property: It would become co-tenant, tenant, or another other feeholder. Because petitioner does not hold any property interest and is not an owner, the petition must be dismissed for a lack of standing.

This court dismissed the predecessor to this case, Manhattan Avenue Associates v McSwain, for a lack of standing as well, but standing would have been adequate had petitioner pleaded the identity of the proper party. (See RPAPL 741 [1] [requiring a statement as to a petitioner's interest of in the property and proving that a misstatement as to ownership requires that the petition be dismissed].) The dismissal in that earlier proceeding was based on petitioner's defective pleading and its failure to allege that Manhattan Avenue Associates, as owners of the property (satisfying Section 8 HUD requirements), had entered into a lease with respondent through its managing agent, Met Realty Group (satisfying the RPAPL pleading requirement).

This opinion is the court's decision and order.

Dated: April 30, 2010

J.H.C.