March 16, 2012
SPARKLE MAIR, PLAINTIFF-RESPONDENT,
JERRY WILEY, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Law Division, Special Civil Part, Hudson County, Docket No. DC-026200-10.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted January 31, 2012
Before Judges Carchman and Baxter.
In this landlord-tenant matter, defendant-landlord, Jerry Wiley, appeals from a December 22, 2010 Special Civil Part judgment requiring him to pay the sum of $4500 to plaintiff-tenant, Sparkle Mair. Plaintiff initiated the proceeding pursuant to N.J.S.A. 2A:18-61.1h, which imposes a financial penalty on a landlord who creates an illegal occupancy. In such cases, the landlord is required to reimburse the displaced tenant in an amount equal to six times the monthly rent. N.J.S.A. 2A:18-61.1h(c). We reject defendant's contention that because the tenant was not evicted in an eviction proceeding by court order, but instead moved out after the Jersey City code enforcement officer directed her to do so, the judge was not entitled to impose the statutory penalty. We likewise reject defendant's assertion that by agreeing to vacate the premises and accept a refund of the two months rent that she had paid, plaintiff relinquished her right to seek and obtain the statutory penalty authorized by N.J.S.A. 2A:18-61.1h(c). We affirm, although we modify the judgment to reflect the $1500 refund defendant previously issued.
On July 1, 2010, the parties signed a document entitled "Commercial Lease" for "the premises . . . described as 310 Pacific Avenue" in Jersey City on a month-to-month basis at a rent of $750 per month. Even though the building had three floors, the lease did not specify the portion of the building to which the lease applied. In paragraph 2, the lease provided:
Lessee shall use and occupy the premises for OFFICE. The premises shall be used for no other purpose. [Landlord] represents that the premises may lawfully be used for such purpose.
According to plaintiff, she told defendant at the time she signed the lease that she intended to live there with her five-year old son. When she asked defendant why the lease was entitled "Commercial Lease," he responded that "she should not worry about it" and "that was the only lease that he was able to pull up." Because it was the first time plaintiff had ever rented an apartment, she "trusted him" and "gave him the benefit of the doubt."
Plaintiff moved into the premises, which consisted of two small bedrooms, one for her and one for her son, a kitchen and a bathroom. The unit was located in the rear of the first floor of the building, behind a commercial space.
Plaintiff paid the July and August 2010 rent, which totaled $1500. In the middle of August, defendant presented plaintiff with the utility bill, which she disputed. Plaintiff then spoke to the tenants who lived on the second and third floors of the building, who told her that she should "confirm and make sure the apartment is legit" [sic] before she agreed to split the utility bill with defendant. After her conversation with the other tenants, plaintiff "c[a]me to the realization that it wasn't an apartment, it was illegal. He had halved it off from his commercial property."
At that point, plaintiff "took it upon [her]self" to call the Acting Zoning Officer, Nick Taylor, who advised her on August 20, 2010 "that the apartment was illegal." According to plaintiff, Taylor notified her that "due to [the] violation[,] [she] would have to move and relocate [her]self." Taylor told plaintiff that it was "illegal for [her] to be there as a resident living with a five-year old son and [she] had to vacate the premises[.]"
At some time that same day, August 20, 2010, Taylor conducted a site inspection and recommended to the parties that plaintiff move out immediately, and that defendant refund the $1500 of rent that plaintiff had already paid. Plaintiff agreed to those terms and moved out at 6:00 p.m. the same day. She and defendant executed a document, which stated in its entirety:
Re: Refund of all rents paid Effective today, August 20, 2010, $1500 will be refunded to the above mentioned tenant. Said dollar amount represents a full refund of two months of rent paid by tenant. Tenant agrees to vacate the premise[s] today.
Both parties signed the document.
Three days later, on August 23, 2010, Taylor issued defendant a notice of violation entitled:
NOTICE OF VIOLATION
ORDER TO REMEDY
PURSUANT TO CHAPTER 345
The notice of violation specified August 23, 2010 as the "date of inspection," and notified defendant that he had "been found to be in violation of the Jersey City Zoning Code" due to an "illegal third unit behind commercial space. Not listed on tax records." The Notice directed defendant to abate the violation within thirty days.
On August 27, 2010, plaintiff filed a complaint against defendant in the Special Civil Part seeking damages in the amount of $4200 as reimbursement for the security deposit she paid for the new apartment as well as the moving expense she had incurred. Plaintiff's complaint alleged she was entitled to damages in that amount because defendant had rented her an "illegal apartment." Defendant filed a counterclaim in the amount of $3750 based on unpaid rent.
At trial, plaintiff testified to what we have already described. Defendant testified that in response to his newspaper advertisement for the rental of commercial space, plaintiff contacted him, expressing an interest in renting the premises for a "business." When he asked her "what kind of business," she responded, according to defendant, that "she hadn't made a decision on that." Defendant maintained that once plaintiff "got in there, . . . she changed [her mind] and she decided to different [sic] and turned it from a commercial space to a residential space." When the judge asked defendant whether he confronted plaintiff about her use of the leased space as an apartment, defendant said he had told plaintiff that the unit was "supposed to be a commercial space." A day or two after that exchange, "the zoning people appear[ed] and that was on August the 20th."
According to defendant, when Taylor came to the premises on August 20, 2010 to conduct an inspection, Taylor told defendant that the unit could not be used for residential purposes, but recommended, in defendant's words, that "instead of it being a long drag[ged] out thing just return the two months [rent] that [plaintiff] had paid and [Taylor] won't proceed any further with it." The judge expressed some skepticism about defendant's insistence that when plaintiff rented the space from him, she told him that she intended to run a business there. The judge asked defendant the following question:
She rented it to use as a business and then called the zoning officer and reported that it wasn't legal for her to use it as an apartment?
Yes. Once I told her that she had to pay the utilities and that's when she . . . called the zoning department.
The judge also asked defendant if he typically entered into month-to-month leases with commercial tenants, to which defendant responded that he used a month-to-month lease if the tenant was "questionable" for any reason.
During defendant's testimony, plaintiff produced a cell phone photograph of the rental advertisement defendant had posted on the building, which said "three two-bedroom [apartments], section 8, call (201) ***-****."*fn1 After examining the photograph, the judge asked defendant how it was possible for him to rent three apartments if he was only authorized to maintain two apartments in that building. Defendant answered that the third apartment advertised was actually located in a different building. The judge also asked defendant why there was a shower stall, toilet, sink, kitchen sink and a walk-in shower in a commercial space. Defendant answered, "the gentleman who stayed there" and "had his office there . . . used the back half for storage."
At the conclusion of the testimony, Judge Baber specifically found plaintiff's version of events more credible than defendant's. He held that defendant knew that plaintiff would be using the premises for residential purposes. The judge specifically rejected defendant's contention that plaintiff had assured him that she would be operating a business on the premises, noting that the photographs depicted a two-bedroom apartment with a kitchen and a bathroom. Finding that "the space was, notwithstanding the designation of the lease as a commercial lease, rented as an apartment," the judge held that it was "not a legal apartment." He entered judgment against defendant in the amount of $4500, representing six months' rent, in accordance with N.J.S.A. 2A:18-61.1h(c). The judge dismissed defendant's counterclaim.
On appeal, defendant raises the following claims:
I. THE JUDGMENT FOR PLAINTIFF ERRONEOUSLY RELIED ON THE APPLICATION OF THE ANTI-EVICTION ACT.
A. The relocation assistance remedy requires the tenant be evicted from premises under N.J.S.A. 2A:18-61.1(g)(3) in a summary dispossess proceeding.
B. The defendant was cited for an alleged illegal apartment after the tenancy between defendant and plaintiff ended by mutual consent.
C. There was no proof that it was not feasible to correct the illegal occupancy without removing the tenant.
D. The trial court failed to determine whether the tenancy was governed by N.J.S.A. 2A:18-61.1.
II. THE SETTLEMENT AGREEMENT BETWEEN THE PARTIES MUST BE HONORED BY THE COURT.
III. THE COURT MUST NOT BE PERMITTED TO CREATE A MORE FAVORABLE SETTLEMENT THAN THE PARTIES THEMSELVES REACHED.
Although we review the trial judge's conclusions of law de novo, Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995), we are bound by the trial judge's findings of fact so long as they are supported by substantial and credible evidence in the record, Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974). The Anti-Eviction Act, N.J.S.A. 2A:18-61.1 to -61.12, was enacted "to protect residential tenants against unfair and arbitrary evictions by limiting the bases for their removal." Maglies v. Estate of Guy, 193 N.J. 108, 121 (2007) (citation and internal quotation marks omitted).
In determining the rights of a residential tenant, "[a] label imposed by the landlord cannot and should not control our analysis of the law. The courts of this [S]tate long have recognized the need to look beyond labels in order to explore the true character of a transaction or relationship." Id. at 122. Moreover, "the Anti-Eviction Act is remedial legislation deserving of liberal construction." Id. at 123 (citation and internal quotation marks omitted). "'Remedial statutes are liberally construed to suppress the evil and advance the remedy.'" Ibid. (quoting 3 Norman J. Singer, Sutherland Statutory Construction § 60:1 at 183 (6th ed. 2001)).
As the Court observed in Maglies, when the Legislature enacted the Anti-Eviction Act, the Legislature recognized that: [i]t is in the public interest of the State to maintain for citizens the broadest protections available under State eviction laws to avoid such displacement and resultant loss of affordable housing, which, due to housing's uniqueness as the most costly and difficult to change necessity of life, causes overcrowding, unsafe and unsanitary conditions, blight, burdens on community services, wasted resources, homelessness, emigration from the State and personal hardship, which is particularly severe for vulnerable seniors, the disabled, the frail, minorities, large families and single parents. [Id. at 124 (quoting N.J.S.A. 2A:18-61.1a(d)) (second emphasis added).]
The Court also observed that the Legislature "included 'homelessness,' and family and social disruption among the ills the Act was designed to prevent." Id. at 124 (citation omitted). "The Legislature's statements and findings demonstrate that the Legislature intended the Anti-Eviction Act to protect blameless residential tenants, especially those vulnerable to homelessness, family disruption, and becoming a strain on the community's resources." Ibid.
The statute in question, N.J.S.A. 2A:18-61.1h(a), provides in relevant part:
If a residential tenant is displaced because of an illegal occupancy in a residential rental premises pursuant to [N.J.S.A. 2A:18-61.1g(3)] and the municipality in which the rental premises is located has not enacted an ordinance [requiring the landlord to provide a tenant with relocation assistance after an illegal tenancy], the displaced residential tenant shall be entitled to reimbursement for relocation expenses from the owner in an amount equal to six times the monthly rental paid by the displaced person.
That section refers to N.J.S.A. 2A:18-61.1(g)(3), which provides that:
No . . . tenant . . . may be removed by the Superior Court from any house [or] building . . . leased for residential purposes, . . . except upon establishment of one of the following grounds as good cause:
g. The landlord or owner . . . seeks to correct an illegal occupancy because he has been cited by local or State housing inspectors or zoning officers and it is unfeasible to correct such illegal occupancy without removing the tenant[.]
When read together, the two statutes entitle a judge to award a tenant the sum of six times the monthly rental paid whenever the tenant is evicted from an illegal occupancy after the landlord has been cited by local or State housing inspectors, and it is impossible to correct the illegal occupancy without removing the tenant. Defendant asserts that because plaintiff was not evicted by order of the Superior Court, but was instead directed to vacate the premises by the Jersey City zoning officer, the judge was not entitled to award plaintiff the relocation benefits authorized by N.J.S.A. 2A:18-61.1h(a).
As we have noted, Judge Baber found that the tenancy was illegal, and that defendant engaged in the subterfuge of using a document entitled "Commercial Lease" in an effort to disguise the fact that he was illegally renting an apartment to plaintiff in a section of the building where only commercial uses were permitted. The judge observed that the zoning officer determined that the tenancy was illegal, and ordered plaintiff to move out immediately. Three days later, Taylor issued defendant a notice of violation for that very reason.
While it is true that no eviction proceedings were ever instituted, the record supports the conclusion that the only reason that no formal eviction proceeding was ever filed is because Taylor intervened, declared the occupancy illegal, and ordered plaintiff to leave the apartment immediately. We have no doubt that had plaintiff not agreed to vacate the premises immediately, as Taylor ordered her to do, defendant would have been forced to institute an eviction proceeding, and, in doing so, would have relied upon N.J.S.A. 2A:18-61.1(g)(3). That section of the Anti-Eviction Act authorizes a landlord to evict a tenant when the landlord "seeks to correct an illegal occupancy because he has been cited by local . . . housing inspectors . . . and it is unfeasible to correct such illegal occupancy without removing the tenant[.]"
As we have noted, the Anti-Eviction Act is remedial legislation that must be liberally construed. Maglies, supra, 193 N.J. at 123. For that reason, we will not give the legislation the crabbed interpretation defendant urges. After Taylor informed her that her occupancy was illegal, and that she must move out immediately, plaintiff had little, if any, choice, and was forced to vacate the premises forthwith. Had she refused to do so, an eviction proceeding would have been instituted; and, in all likelihood, plaintiff would have been evicted, as it was not possible to "correct such illegal occupancy without removing the tenant." N.J.S.A. 2A:18-61.1(g)(3). We conclude that an eviction would have been the only way to correct the illegal occupancy because the first floor of the building was not zoned for residential use.*fn2 Under such circumstances, to insist that plaintiff is not entitled to the benefit of the statutory relocation expenses because she did not wait until an eviction proceeding was instituted against her ignores the salutary purposes for which the legislation was enacted. We reject the argument defendant advances in Point I.
We address Points II and III together. Defendant argues that because plaintiff agreed to move out voluntarily, and to accept the refund of two months' rent as reimbursement for her inconvenience and dislocation, the judge erred by fashioning a greater benefit for plaintiff than the one she had agreed to accept. This argument lacks sufficient merit to warrant extended discussion. R. 2:11-3(e)(1)(A) and (E). We are satisfied that the involvement of the zoning officer, and his demand that plaintiff vacate the premises immediately, afforded plaintiff little choice. Plaintiff was a single parent who found herself in an illegal dwelling.
Such circumstances were among those that motivated the Legislature to enact the statutory remedy relied on by the judge in this case. See N.J.S.A. 2A:18-61.1a(d) (finding that "[i]t is in the public interest of the State to maintain for citizens the broadest protections available under State eviction laws to avoid . . . displacement and resultant loss of affordable housing, . . . which [has a] particularly severe [impact on] . . . single parents") (emphasis added). Plaintiff agreeing to move out immediately, and accept a refund of the rent, does not disqualify her from receiving the statutory remedy provided by N.J.S.A. 2A:18-61.1h(a). Moreover, the document the parties signed on the day plaintiff vacated the premises, recited defendant's obligation to refund the rent and plaintiff's agreement to move out. Nothing in that document suggested, much less required, that plaintiff's acceptance of the rent refund barred her from taking any further action against defendant.
We affirm the judgment under review. We note, however, that because defendant refunded two months' rent, the judge should have deducted that amount from the award. For that reason, we affirm the award of damages, but reduce the judgment to the sum of $3000.
Affirmed as modified.