68 74 Thompson Realty LLC vs. Carolyn Heard, Yvonne Tseng et al.

After the prime tenant defaulted in this non-primary residence holdover proceeding, Deborah Riegel, a member of Rosenberg & Estis, P.C. successfully represented the petitioner, 68 74 Thompson Realty LLC, in defeating a subtenant's demand for a rent-stabilized lease in her own name under an illusory tenancy theory. The petitioner was granted a judgment of possession and warrant of eviction against all respondents in this proceeding.

Rosenberg and Estis, P.C., served as counsel for the petitioner, 68 74 Thompson Realty LLC, which was attempting to recover possession of an apartment in the building it owns after it discovered that Carolyn Heard ("Heard"), the tenant of the apartment, was not the primary resident and was subletting the apartment to a Yvonne Yseng ("Tseng"). Heard did not appear in the proceeding or dispute the allegation that she no longer primarily resided in the apartment. The only defenses to the proceeding were asserted by Tseng, who claimed that Heard's tenancy was illusory and, therefore, Tseng should be granted a direct lease with the Petitioner in her own name. Tseng claimed that she was the sole tenant of the Apartment, had resided there with her daughters for years after Heard vacated, and had paid all the rent. She also alleged that Petitioner's agents knew about her occupancy; that building superintendents had seen her in the Apartment; and that she had paid Heard, above and beyond the rent due under the Lease, for the right to remain in possession.

Through discovery and cross-examination at trial, Petitioner established that respondent conspired with Heard to deprive it of knowledge of Respondent's claims. Specifically, both Tseng and Heard held themselves out as roommates and stated that they were co-occupying the Apartment. Crucially, Petitioner proved that in a proceeding to evict Tseng based on Heard's illegal sublet of the Apartment to her, she entered into a so-ordered stipulation representing that they were roommates and ensured that Heard was present at a required inspection so as to defraud Petitioner into believing that Heard was living with her. Petitioner also proved that, in furtherance of their scheme, Tseng and Heard opened a joint bank account, which was used virtually exclusively to pay the rent, and that when renewal leases were sent to Heard, Tseng mailed them to Switzerland where Heard would sign them and mail them back to her. Tseng would then transmit them to Petitioner in envelopes with Heard's name and return address at the Apartment. Moreover, Tseng failed to establish that Heard profited from the subtenancy. To the contrary, Tseng admitted that Heard did not demand any rent increases and that any additional sums Tseng paid to Heard were gifts.

After trial, Judge Sabrina Kraus adopted Rosenberg & Estis's arguments and found that Tseng and Heard colluded in a scheme to hide the subtenancy from the Petitioner, as a result of which, Respondent's claim of illusory tenancy was without merit. Accordingly, Judge Kraus granted the Petitioner a final judgment of possession, with a warrant of eviction to be issued forthwith.

(Rosenberg & Estis, P.C. Team: Deborah E. Riegel)