This case poses the previously unanswered question of whether tenants of a New Jersey Housing Finance Agency (HFA) residential project who fail to pay an agency-approved rent increase may, in a summary dispossess action instituted because of their failure to pay the increase, assert as a defense that the increase was "unconscionable." They may not.
The issue is before the court on a motion for partial summary judgment by the owner (Marineview) of the project in which defendants reside. From the certifications submitted, the following relevant facts emerge as undisputed:
1. Marineview was granted a rent increase covering defendants' apartments by the HFA on August 27, 1981.
2. Defendants, acting through a tenants association, have withheld the increase from their regular rental payments to Marineview.
3. On April 27, 1982 Marineview commenced an eviction action against defendants in the Hudson County District Court. On defendants' motion the action was removed to this court on June 15, 1982.
4. Defendants entered defenses of violation of warranty of habitability as well as those available under the Anti-Eviction Act, N.J.S.A. 2A:18-61.1.
5. Plaintiff then moved for partial summary judgment, solely as to the defense under N.J.S.A. 2A:18-61.1(f) which precludes eviction for nonpayment of any rent increase determined to be "unconscionable."
To resolve the issue, the provisions of N.J.S.A. 55:14J-9(5) empowering the agency to control rents must be reconciled with
the Anti-Eviction Act's unconscionability provision. The issue, therefore, is solely a question of law and summary judgment is appropriate.
The result reached here is a logical sequence of Overlook Ter. Mgmt. v. W. New York Rent Control Bd., 71 N.J. 451 (1976), where the court held that HFA-approved rent increases could not be overridden by local rent regulations. Exclusive control by the HFA of its own projects was recognized as the aim of the New Jersey Housing Finance Agency Law of 1967.
The HFA's ability to set rents within its projects without external interference is essential to the fulfillment of its statutory mission of providing low-cost housing while at the same time maintaining a reasonable rate of return for ...