March 12, 2010
LAURA CIOCIOLO, PLAINTIFF-RESPONDENT,
HOBOKEN RENT LEVELING & STABILIZATION BOARD, DEFENDANT, AND CHARLES ROSEN AND SUZANNE ROSEN, DEFENDANTS-APPELLANTS.
On appeal from Superior Court of New Jersey, Law Division, Hudson County, Docket No. L-577-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted February 10, 2010
Before Judges Stern and Newman.
This is an appeal from an order denying defendants Charles and Suzanne Rosen a vacancy decontrol increase of twenty-five percent for 2004 on Apartment No. 4E, 334 Hudson Street, in a building owned by them in Hoboken. The Hoboken Rent Leveling and Stabilization Board (the Board) denied that relief. Judge O'Shaughnessy affirmed the Board's action on the basis that it was neither arbitrary, capricious, or unreasonable. In his oral decision of January 8, 2009, Judge O'Shaughnessy relied on a prior decision of this court involving the same landlord. Rosen v. Hoboken Rent Leveling & Stabilization Board, Docket Nos. A-3188-06 and A-3764-06 (App. Div. Sept. 12, 2008).*fn1 There, the landlord was obligated to file the vacancy decontrol certificate upon the entry of the new tenant or within one year of occupancy of the new tenant. This court held that where a tenant after moving in during 2004 filed for a legal rent calculation (LRC) in 2005, the decontrol certificate filed subsequent to the filing of the LRC request was untimely. Id. at 2, 14. We now affirm.
On appeal, defendants raise the following points for our consideration:
THE LOWER COURT'S DECISION PERMITTING PLAINTIFF TO PARTICIPATE IN THE REMAND PETITION PROCEEDINGS SHOULD BE OVERTURNED.
POINT II THE DECISION OF THE LOWER COURT FINDING THAT THE BOARD WAS NOT ARBITRARY AND CAPRICIOUS IN DENYING A VACANCY DECONTROL FOR 2004 SHOULD BE OVERTURNED.
We need not address Point I because it makes no difference in the result. Even if we were to agree that plaintiff Laura Ciociolo should not have been permitted to participate, it does not impact on whether the judge's decision that denied a 2004 vacancy decontrol by the Board was correct.
The legal principles which govern this appeal and were relied upon by Judge O'Shaughnessy were set forth in Rosen v. Hoboken Rent Leveling & Stabilization Board, supra, which had this to say about the Hoboken Rent Control Ordinance:
First, we note that the Ordinance has the following provision:
§ 155.29. Construal Provisions.
This chapter, being necessary for the welfare of the city and its inhabitants, shall be liberally construed to effectuate the purposes thereof as set forth in its preamble. The purpose of the Ordinance is to stabilize rents and to provide a public record system so that landlords, tenants and the Rent Leveling Officer can quickly ascertain the "legal" rent for any apartment. The requirements of an annual registration statement and a vacancy decontrol certificate advance that goal. Non-compliance with these registration requirements impede the Ordinance's purpose and objective.
Second, contrary to Landlords' argument, the Ordinance does set a deadline for filing the registration statement and vacancy decontrol certificate. As to the registration statement, it must be filed by October 1st of every year. Hoboken Gen. Ord. § 155-30A. As to the vacancy decontrol, the Ordinance provides "[w]hen any apartment unit is decontrolled . . . , the landlord shall file a [decontrol] certificate . . . ." Id. at § 155-33.
Therefore, here, pursuant to the clear and unambiguous language of Section 155-33, the registration must be filed when the unit is vacated. By necessity, a reasonable period after the unit becomes vacant must be allowed. [Id. at 10-11.]
Under Regulation 18:66, the landlord is required to file a decontrol certificate prior to the tenant's request for an LRC. Here, the tenant filed an LRC request on August 28, 2006, well before defendants filed the decontrol certificate in 2007 which rendered that certificate untimely. Notwithstanding, defendants contend that they had been granted a vacancy decontrol in 2001 and could not file for another three years under the ordinance. Even if this were so, defendants could have filed the decontrol certificate in early 2005 and been timely, and prior to any LRC requested by the then-tenant, plaintiff Laura Ciociolo. Filing in January 2005 would not have violated the one-filing-per-three-year-limitation.
To the extent that defendant argues that reliance by the trial court on the Rosen decision was misplaced, we disagree. The legal issue of whether the filing of a vacancy decontrol certificate was a condition precedent to receiving a twenty-five percent vacancy decontrol increase was decided against defendants. Id. at 14. Defendants were a party in the prior proceeding in which the legal issue was actually litigated, a final judgment on the merits was issued, the determination of the issue was essential to the prior judgment and the defendants appealed as of right and lost. All of the indicia of collateral estoppel were present. Olivieri v. Y.M.F. Carpet Inc., 186 N.J. 511, 521 (2006). Accordingly, the trial court not only had a right to rely on the September 12, 2008 opinion, but could have invoked the doctrine of collateral estoppel or issue preclusion on this preliminary legal issue. The only remaining step for the court was to note, as it did, that the LRC had been requested by the tenant well before defendants filed for a decontrol certification in 2007, which factually was undisputed.
Defendants contend that the Board's decision "does not take into consideration the unfair result to the Defendants." Defendants argue that it would be inequitable to prohibit defendants from having relief here when they exercised good faith in following the ordinance. They assert that the court's decision "would now require landlords to apply for all possible vacancy decontrols, in anticipation of a subsequent challenge by a tenant."
Not so. If a landlord does not find the need for a vacancy decontrol, there is no loss if the landlord does not file a decontrol certificate. Obviously, market conditions in rental apartments would be a significant factor in any re-letting. On the other hand, if the landlord deems it necessary to seek a rental increase, the conditions precedent for a vacancy decontrol increase are set forth in the Ordinance. That was the case before the 2008 Rosen decision. It is clearer now since Hoboken has adopted Regulation 18.66, Filing of Certificate for Controlled Units, in which it spells out that the certificate is to be filed no later than the latter of either one (1) year from when the vacancy occurred or one (1) year from when the apartment was first rented to a replacement tenant after a vacancy, and the dwelling must have been registered at the time of the filing is in compliance with Section 155-31.
The certificate still must be "filed prior to a request for a legal rent calculation." Ibid. Insofar as defendants here are concerned, the certificate was not filed before the LRC request. The trial court properly affirmed the Board's decision, denying the application for a 2004 vacancy decontrol increase on Apartment No. 4E, 334 Hudson Street, Hoboken.