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M.C. Associates v. Shah

Decided: June 30, 1988.

M.C. ASSOCIATES, A NEW JERSEY LIMITED PARTNERSHIP, PLAINTIFF-RESPONDENT,
v.
RAJNIKANT B. SHAH; VASUDEV TRIVEDI; CHIMAN PATEL; B. CHODAVADIA; ATUL R. SHAH; PRAVIN SOLANKI; REMESH DALAL; JYOTSNA PATEL; S. MAJMUNDAR; JITENDRA LACKADAWALA; VALLABH SHELADIA; VICKRAM SOLANKI; SURESH A. SHAH; BHIKHA BAMBROLIA; RAMESH PATEL; MEHENDRA SHAH; SUDHABEN B. DESAI; RATANLAL DALAL; SURENDRAKUMAR BHATT; MARIA RAVENA; LILUBHAI MOCHI; GORDON C. PATEL; DHANSUKH PATEL; MAHENDRA CHOKSHI; BHAGU PATEL; KALYANBHIN BORAD; VIJAY PATEL; BHANUMATI JOSHI; DEVENDRA VYAS; RAJENDRA P. SHAH; BHOGHIBHAI PATEL; VISHNU D. PATEL; KISHOR PATEL; AJIT SHAH; AJIT SHAH; KANTILAL SHAH; ARUNA BHATIA; NATHUBHAI PATEL; JAYESH PARIKH; RAJAN SAVALIA; NITIN DOSHI; CHANDRAVADN B. SHAH; SHANTILAL PATEL; MANU PATEL; ANNA PEREZ; SURESH PARIKH; INRAMDAN PATEL; UPRENDRU SHAH; CHANDRAHANT PATEL AND KAUNUERSI LAVANI, DEFENDANTS-APPELLANTS



On appeal from Superior Court of New Jersey, Law Division, Hudson County.

Pressler, Bilder and Skillman. The opinion of the court was delivered by Skillman, J.A.D.

Skillman

Plaintiff owns nine multiple dwellings located in Hoboken. Defendants are tenants of 50 apartments in the buildings.

Upon the expiration of their prior leases, plaintiff sent the tenants new leases. These leases contained a new provision limiting occupancy to either four or five persons, depending upon the size of a tenant's apartment. These occupancy limits were established in accordance with a regulation adopted by the Department of Community Affairs, N.J.A.C. 5:10-22.3, pursuant to the Hotel and Multiple Dwelling Law, N.J.S.A. 55:13A-1 et seq. The apartments of at least some defendants were

occupied by more persons than allowed under the occupancy limits.

Defendants refused to sign the new leases. Plaintiff then brought summary dispossess actions in the Special Civil Part to evict defendants. These actions were consolidated and transferred to the Law Division.

Plaintiff moved for summary judgment and defendants moved to dismiss the complaints. The trial court concluded in a letter opinion dated March 5, 1987 that the provisions of the proposed new leases limiting the occupancy of the apartments were reasonable and that defendants could be evicted for refusing to sign them. The court also concluded that defendants would not be entitled to any relief even if plaintiff and its predecessors in title had been aware of the overcrowding in their apartments, because "it would offend public policy to apply estoppel against the landlord in this situation." Accordingly, the trial court entered orders on March 9 and 23, 1987 awarding plaintiff possession of the apartments. However, upon defendants' application, the trial court entered another order on March 31, 1987, which permitted defendants to avoid the judgments of possession by executing leases containing the occupancy limits. It appears that all of the defendants availed themselves of this opportunity and continue to occupy their apartments.*fn1

Defendants appealed from the trial court's orders upholding plaintiff's right to include occupancy limits in the renewal leases. Plaintiff cross appealed from the part of the trial court's order of March 31, 1987 which permitted defendants to avoid eviction by signing renewal leases containing occupancy

limits. However, plaintiff failed to file a timely brief, which resulted in a dismissal of its cross appeal.*fn2

We agree with the trial court's conclusion that a landlord is not required to wait for a code enforcement action before requiring its tenants to comply with the occupancy limits imposed by N.J.A.C. 5:10-22.3. See Floral Park Tenants v. Project Holding, Inc., 152 N.J. Super. 582, 597-598 (Ch.Div.1977), aff'd o.b. 166 N.J. Super. 354 (App.Div.1979), certif. den. 81 N.J. 278 (1979). We also agree that an occupancy provision in a lease is an appropriate means for securing such compliance and therefore that a landlord may require even tenants who are then in violation of the occupancy limits to sign leases containing those limits. However, we conclude that a landlord which seeks to enforce occupancy limits against such tenants may be liable for the same or similar benefits as the tenants would be entitled to receive if they were removed as a result of code enforcement proceedings. Since the judgment entered by the trial court failed to provide such relief, we reverse.

The subsection of the Anti-Eviction Act which specifically addresses the subject of removal of tenants in order to correct conditions of illegal occupancy is N.J.S.A. 2A:18-61.1(g)(3). This subsection provides ...


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