[*1]
Hernco, LLC v Hernandez
2015 NY Slip Op 50062(U) [46 Misc 3d 137(A)]
Decided on January 15, 2015
Appellate Term, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.


Decided on January 15, 2015
SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

PRESENT: : WESTON, J.P., SOLOMON and ELLIOT, JJ.
2012-2330 K C

Hernco, LLC, Respondent,

against

Jose Abraham Hernandez Doing Business as GENERATION HERNANDEZ FURNITURE, INC. and also Doing Business as GENERAL HERNANDEZ FURNITURE, Appellant.


Appeal from two orders of the Civil Court of the City of New York, Kings County (Genine D. Edwards, J.), dated August 29, 2012. The orders, respectively, denied tenant's motions (1) to stay enforcement of a final judgment that had been entered pursuant to a stipulation settling this commercial nonpayment summary proceeding, and to permit tenant access to the premises to recover property, and (2) to vacate the final judgment.

ORDERED that the orders are affirmed, without costs.

On August 27, 2011, landlord served tenant, a furniture retailer, with a three-day notice alleging the nonpayment of three months' rent, at $7,000 per month, for the period June through August 2011, in relation to a commercial premises at 4518 Fifth Avenue, Brooklyn, New York. On October 3, 2011, landlord served tenant with a notice of petition and petition which alleged, inconsistently, that, pursuant to a "written rental agreement," the subject premises "were rented for residential purposes" and "for commercial use only." There is no dispute that the premises at issue was used solely for commercial purposes and that the tenancy was month to month based on an oral agreement.

After tenant Jose Abraham Hernandez appeared in person and interposed a general denial, landlord twice moved to, among other things, strike tenant's answer and grant landlord summary judgment. On December 23, 2011, the Civil Court denied the first motion, and, on January 10, 2012, the parties, represented by counsel, entered into a so-ordered stipulation of settlement whereby landlord's second motion for summary judgment was granted to the extent of amending the petition to allege all of the rent due to date, and awarding landlord possession and the sum of $56,000, representing the rent due from June 2011 through January 2012, and a warrant of eviction, which was stayed until January 31, 2012. The stipulation also provided that, if tenant satisfied the money judgment by the end of the month, the final judgment would be deemed satisfied and the warrant of eviction vacated. A final judgment awarding landlord possession and the sum of $56,000 was entered on January 24, 2012.

There is no dispute that, on February 21, 2012, tenant paid landlord $32,000 ($2,000 of [*2]which tenant claimed represented attorney's fees) and that the parties discussed the possibility of a new tenancy based on a written lease. (Tenant claims that he was provided with a lease, which he signed and gave to landlord but which was never returned to tenant.) Tenant made no further payments on the judgment, and the warrant of eviction was executed on March 26, 2012. In a memorandum dated April 6, 2012, landlord granted tenant access to the premises, from April 13, 2012 through April 15, 2012, to remove any remaining property.

On May 21, 2012, tenant moved, by order to show cause, to, among other things, direct landlord to provide tenant additional access to the premises to remove property, and to stay enforcement of the final judgment. In a supporting affidavit, tenant questioned the propriety of the March 26, 2012 eviction since, on February 21, 2012, tenant had paid landlord $32,000 in return for a promised lease, which had never been delivered. On the May 24, 2012 return date of the motion, the Civil Court adjourned the motion to June 22, 2012 and directed the parties' attorneys to "arrange for [tenant] to have access to his remaining possessions at the subject premises." On June 3, 2012, before landlord had filed its response to the motion of May 21, 2012, tenant moved to set aside the consent final judgment on the grounds of "fraud, misrepresentation, or other misconduct of an adverse party," specifically, that, contrary to the allegation of the petition, there was no written lease; that, on February 21, 2012, the parties had created a new contractual relationship, superseding the stipulation; and that, if no contract had been made, landlord's acceptance of the $32,000 was fraudulent. As additional grounds, tenant cited the material defects and discrepancies in the petition, inadequate service of both the predicate notice and the petition, the failure to serve a 30-day notice as required to terminate a month-to-month tenancy, and that the proceeding was commenced by someone not authorized to do so. These defects, according to tenant, were of jurisdictional significance, requiring the vacatur of the stipulation and the final judgment based thereon, and dismissal of the summary proceeding, and rendering the eviction illegal.

In response to the motions, landlord documented the abundant opportunity that had been afforded tenant to remove his property from the premises and acknowledged that it had agreed orally with tenant that, if tenant satisfied the remainder of the money judgment, resumed the payment of rent per the terms of the prior tenancy, and obtained proper insurance, landlord would grant tenant a written lease. Landlord argued that the stipulation was proper on its face, remained enforceable notwithstanding the events of February 21, 2012, and represented tenant's waiver of the defects in the service and content of the predicate notice and the petition. By orders dated August 29, 2012, the Civil Court denied the motions, ruling that tenant had failed to avail himself of the ample opportunity afforded him to remove his property; that tenant had failed to demonstrate a basis to vacate the stipulation; and that the execution of the stipulation waived tenant's claims with respect to the content and service of the predicate notice and the notice of petition and petition. Tenant appeals from both orders, and for the reasons that follow, we affirm the orders.

"It is well settled that stipulations of settlement are judicially favored and will not easily be set aside (see Hallock v State of New York, 64 NY2d 224 [1984]; Matter of Frutiger, 29 NY2d 143 [1971]). While stipulations of settlement may be vacated on grounds sufficient to set aside a contract, such as fraud, mistake, collusion or accident (see Nash v Yablon-Nash, 61 AD3d 832 [2009]), a party should not be relieved from the consequences of the stipulation, particularly one made in open court,' absent a sufficient or compelling showing of the above" (Cach, LLC v Woodsnajac, 42 Misc 3d 129[A], 2013 NY Slip Op 52165[U], *1 [App Term, 2d, 11th & 13th Jud Dists 2013]). Here, insofar as the motion to vacate the stipulation is based on matters occurring subsequent to the stipulation and the entry of the final judgment, it fails to establish the required grounds. Tenant claims that, by virtue of the parties' conduct on February 21, 2012, landlord renounced its rights under the stipulation, or contractually voided its force and effect, by reconstituting the parties' landlord-tenant relationship on terms that did not require tenant's satisfaction of the stipulation's requirements. However, the nature and legal consequences for the present proceeding of the alleged events of February 21, 2012 are not [*3]matters that are justiciable on this appeal, as "a grant of specific performance . . . is not within the compass of the Civil Court" (Wilen v Harridge House Assoc., 94 AD2d 123, 130-131 [1983]). If the parties' conduct on February 21, 2012 created new rights or caused compensable damage, it may constitute the basis of a new cause of action to be pursued in a plenary proceeding for a proper review of the facts and law.

In any event, there is nothing in the stipulation's creation or content that implicates its validity. Tenant was represented by counsel at the time of the stipulation, and nowhere in the record has there been any showing of the existence of a meritorious defense to the proceeding, aside from those that might serve merely to obtain the petition's dismissal or amendment for technical defects, and there are no grounds upon which to infer that the stipulation, which allowed tenant additional time to avoid eviction, was "inadvisedly entered into" or was otherwise inadvertent (cf. Park Props. Assoc., L.P. v Williams, 38 Misc 3d 35, 37 [App Term, 9th & 10th Jud Dists 2012]). Certainly, there is no indication that tenant was unaware of the nature of the tenancy or of the rent owed, that he had not paid rent for the final eight months of that tenancy, or that no basis existed for a setoff of the rent due. The grounds asserted to vacate the stipulation, both in the motion and on the appeal, are either waived or do not constitute "a sufficient or compelling showing" of "fraud, mistake, collusion or accident" to merit vacatur.

The claim that the stipulation is void due to jurisdictional defects in the pleadings is likewise without merit. Where, as here, the proceeding is based on a month-to-month tenant's failure to pay rent, a three-day notice is appropriate (Nadeau v Tuley, 160 AD2d 1130, 1131 [1990]; Tricarichi v Moran, 38 Misc 3d 31, 33 [App Term, 9th & 10th Jud Dists 2012]). Further, while "[the] failure to comply with statutory or contractual requirements for service of a predicate notice may implicate a condition precedent to a summary proceeding[, such failure] does not affect a court's subject matter jurisdiction" (716 Realty, LLC. v Zadik, 38 Misc 3d 139[A], 2013 NY Slip Op 50194[U], *2 [App Term, 2d, 11th & 13th Jud Dists 2013]). While the petition failed to accurately plead the tenancy's status and the nature of the leasehold, and while such requirements are "essential elements [of] the landlord's prima facie case . . . noncompliance therewith constituting defenses to the . . . petition," because such defenses "d[o] not implicate the court's subject matter jurisdiction, . . . [they] c[an] be waived" (433 W. Assoc. v Murdock, 276 AD2d 360, 360-361 [2000] [internal quotation marks and citations omitted]; see also Birchwood Towers #2 Assoc. v Schwartz, 98 AD2d 699, 700 [1983]; Paris Lic Realty, LLC v Vertex, LLC, 41 Misc 3d 145[A], 2013 NY Slip Op 52074[U] [App Term, 2d, 11th & 13th Jud Dists 2013]; PR 247 Wadsworth LLC v DeJesus, 32 Misc 3d 140[A], 2011 NY Slip Op 51600[U] [App Term, 1st Dept 2011]). This rule applies as well to a claim that the petition was brought in the name of a party not authorized to do so (Woodlaurel, Inc. v Wittman, 163 AD2d 383, 384 [1990]) and to the petition's erroneous assertion of the existence of a written lease (see Matter of Meaders v Jones, 15 AD3d 490 [2005]).

Even if such claims had been previously asserted, a subsequent settlement stipulation that does not reserve the right to pursue the claims constitutes a waiver thereof (see e.g. Geraci v Jankowitz, 36 Misc 3d 135[A], 2012 NY Slip Op 51354[U] [App Term, 2d, 11th & 13th Jud Dists 2012]; Monroe Place Assoc. v Arango, 28 Misc 3d 130[A], 2010 NY Slip Op 51251[U] [App Term, 2d, 11th & 13th Jud Dists 2010]; Michalak v Fechtel, 27 Misc 3d 140[A], 2010 NY Slip Op 50946[U] [App Term, 9th & 10th Jud Dists 2010]; 2380-86 Grand Ave. Assoc., LLC v Ortega, 20 Misc 3d 135[A], 2008 NY Slip Op 51511[U] [App Term, 1st Dept 2008]; Seeram v Kearse, 2 Misc 3d 135[A], 2004 NY Slip Op 50213[U] [App Term, 2d & 11th Jud Dists 2004]).

The record also supports the Civil Court's determination that tenant had been afforded ample opportunity to enter the premises to remove his property.

Inasmuch as tenant's claims regarding landlord's enforcement of the judgment rest, in part, on his claim for specific performance, this court makes no determination with respect to the enforceability of the judgment herein as against the property at 9425 Fifth Avenue.

Accordingly, the orders are affirmed.

Weston, J.P., Solomon and Elliot, JJ., concur.


Decision Date: January 15, 2015