Can a Child Occupy a Co-op Apartment if the Shareholder’s Parents Are Not in Residence?

| Jan 14, 2020 | landlord & tenant representation, real estate litigation |

Can a cooperative shareholder’s family member reside in their apartment without the named shareholder living there? New York appellate courts (who review decisions from lower courts and whose opinions control future lower court decisions) have differed in answering this question. The First Department (which covers the Bronx and Manhattan) has held that the phrase “lessee and…” contained in most proprietary leases requires the lessee to occupy with the family member (or else be in breach of the lease). In contrast, the Second Department (covering Queens, Brooklyn, Staten Island, Nassau, Suffolk, and other downstate counties) has held that this phrase permits any of the mentioned family members (parents, grandparents, children, etc.) to use the apartment, whether or not the lessee occupies the apartment at the same time.

In Northridge Cooperative Section III, Inc. v. Bonilla, the cooperative, located in Queens, sought to evict a shareholder for not residing in her apartment and illegally subletting it to her daughter. The shareholder had moved out as part of a divorce settlement and her daughter had remained in the apartment with her father, who was also a shareholder. When the father died, the Cooperative sought to evict the daughter. Northridge had a federal mortgage, and as a result, the occupancy agreements require that the apartment be used as the shareholder’s primary residence.

TWW represented the shareholder and daughter and moved to dismiss the case arguing that under the Second Department rule, co-occupancy by the shareholder was not required even though the loan required the shareholder to live in the apartment and the lease contained another paragraph that required a shareholder to surrender the apartment upon vacating.  The Cooperative argued that the residency requirements imposed as a result of the Fair Housing Act (“FHA”) §312 loan distinguished this case from the typical Second Department case. TWW demonstrated that in other cases involving these types of loans, the Second Department has found the children of members to be part of the “immediate family” and to have the unquestionable right of possession of the apartments, even where the member-parents had moved out.

Judge Lydia Lai agreed with our arguments and allowed the daughter to stay. Judge Lai analogized this to rent regulated housing, where courts are reluctant to find that long-term occupancy by a family member constitutes an illegal sublet or assignment despite that the tenant of record is absent from the premises.

Here, the Court was not willing to evict a family member who had lived in the apartment for a long time with the shareholders of record and was subject to eviction only because her father had died.

Moshe C. Bobker