Justice Court of the Town of Lockport, Niagara County, July 26, 2018

Denise Bennett, plaintiff pro se.

Scott Stopa for defendant.

This small claims action arises out of a previous eviction proceeding between the parties (see case No. 18020276). In that case Walden Park Apts./Lockport Associates (landlord) sought to evict Denise Bennett (tenant) for failure to be recertified and thus a holdover cause of action was filed. That case was settled with tenant agreeing to leave the premises by March 10, 2018. Landlord waived any monetary judgment including any rent, costs, disbursements and attorney's fees due under the lease. In the present case tenant, who left on time and cleaned out the apartment, requests a refund of her $520 ($505 agreed figure) security deposit. Landlord counterclaims for back rent of $339.93 and attorney's fees of $500.

The facts are not in dispute, other than an issue of waiver in the eviction proceeding. Landlord does not include any property damage claim in its counterclaim and tenant's testimony that there was none is uncontroverted except for cigarette smoke.^[FN1] The issues before the court are whether or not tenant is entitled to the return of all, some or none of her security deposit and is landlord now entitled to rent and attorney's fees.

The court has had an opportunity to review the entire eviction proceeding, including its notes, stipulation of the parties and the transcript of the February 28, 2018 hearing.{**61 Misc 3d at 258}

1. Attorney's Fees

Defendant has asserted $500 of its $839.93 claim for attorney's fees expended in this [*2]defense of plaintiff's action and the assertion of defendant's counterclaim.

Under the long-standing "American Rule" attorney's fees are deemed "incidents of litigation" (Hooper Assoc. v AGS Computers, 74 NY2d 487, 491 [1989]), and a prevailing party cannot recover its legal fees "except where authorized by statute, agreement or court rule." (See Gotham Partners, L.P. v High Riv. Ltd. Partnership, 76 AD3d 203, 204 [1st Dept 2010], lv denied 17 NY3d 713 [2011].) Thus in the absence of a contractual fee-shifting provision^[FN2] or applicable statute providing for the recovery of attorney's fees each party to a civil action is generally responsible for its own legal fees (Hooper Assoc. v AGS Computers, 74 NY2d 487 [1989]).

The Court of Appeals in Hooper has an exacting test which requires a finding of unmistakable intent to waive the American Rule. The Hooper standard requires more than an inference of what the parties meant. It requires a specific written clause of having an unmistakable intent to waive the American Rule. Without this we are unable to award attorney's fees to the prevailing party.

Defendant asserts the initial written lease between the parties gives a basis for its claim. The language can be found in paragraph 5 on page 9 of exhibit C as follows:

"5. EVICTION: If Management terminates the lease agreement, Management shall have the right to repossess the apartment and cause the Resident to vacate the apartment in the manner provided by law. If Management is forced to evict Resident, Resident shall pay Management the expense incurred in obtaining possession of the apartment and all other damages sustained by Management, including attorneys' fees, to the extent permitted by law and the USDA, RD's regulations."

[1] The court finds this language unpersuasive and not specific enough to be applied to post eviction proceedings or to meet the Hooper criteria. The court will not broaden the{**61 Misc 3d at 259} language to cover all lawsuits between the parties but only the initial lawsuit to enforce defendant's rights under the original lease. Accordingly, attorney's fees are denied.

2. Security Deposit

[2] Plaintiff is entitled to a full return of her security deposit as no damage setoff is alleged by defendant. The key issues which the court must decide, however, are (1) whether or not a counterclaim for rent can be asserted against a claim for a security deposit return, or (2) whether it was waived in the original eviction proceeding.

The court has reviewed the entire eviction proceeding and finds no waiver by defendant regarding the return of the security deposit.^[FN3] The court views defendant's counterclaim herein as if defendant independently asserted it in its own small claims action and thus it is procedurally viable. However, the statute requires and defendant has the burden of proof to show two estimates or a paid receipt to establish its damages (Uniform Justice Ct Act § 1804; Borman v Purvis, 299 AD2d 615 [3d Dept 2002]). As indicated above, no damage amount was set forth, nor proved at trial by a showing of two estimates or a paid receipt. Therefore, that cause of action must be dismissed. Defendant's claim for rent also fails as a specific waiver was [*3]contained in the previous eviction proceedings.^[FN4]