matter of 400 south 2nd street tenants

Matter of 400 South 2nd

Street Tenants OATH Index No. 1018/16 (Sept. 7, 2018), adopted in part, rejected in part, Loft Bd. Order

No. 4860 (Mar. 21, 2019), reconsideration denied, Loft Bd. Order No. 4904 (Oct. 17, 2019) &

Loft Bd. Order No. 4974 (May 21, 2020), appended

[Loft Bd. Dkt. No. TR-1269; 394-400 South 2nd

Street, Brooklyn, N.Y.]

Loft tenants sought coverage and protected occupancy of Brooklyn

building. Testimony and documentation established residential

occupancy and coverage of eight of ten units and protected

occupancy for the current occupants of the covered units. The

evidence did not support a finding that the remaining two units are

entitled to coverage or the current occupants entitled to protected

occupancy.

Loft Board adopts all of ALJ’s findings except it disagrees that when

assessing primary residency, one should look to the applicant’s status

at the time the application was filed. Instead, the Board ruled that the

entire administrative record must be considered when assessing

primary residency.

______________________________________________________

NEW YORK CITY OFFICE OF

ADMINISTRATIVE TRIALS AND HEARINGS

In the Matter of

400 SOUTH 2ND

STREET TENANTS,

Petitioners

______________________________________________________

REPORT AND RECOMMENDATION

SUSAN J. POGODA, Administrative Law Judge

Petitioners Natalie South, Bryan Andrew Small, Jared Cohen, Kirsten Russell, Katalin

Junek, John Marc Peckham, Scott Matthew, C. Anderson Miller, Koppel Verma, Mentor and

Julie Noci, Ayca Koseogullari and Adam Baer filed coverage and protected occupancy

applications on July 6 and 10, 2015, and August 14, 2016, pursuant to Article 7-C, section 281 of

the Multiple Dwelling Law (“Loft Law” or “Article 7C of the MDL” or “MDL”) and title 29 of

the Rules of the City of New York (“RCNY” or “Loft Board Rules”) ( ALJ Exs. 1, 2).

Petitioners seek a finding that the buildings located at 394-400 South 2nd

Street Brooklyn,

New York (“the Building”), are an interim multiple dwelling (“IMD”), that the applicants

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residentially occupied their second, third, and fourth floor units respectively during the

applicable window period, and that they are the protected occupants of these units.

Respondent, 400 South 2nd

Street Holdings, L.P., the owner of the Building, opposes the

applications (ALJ Exs. 1, 2). The Loft Board referred the matter to this tribunal on November

15, 2015, and the parties engaged in a number of settlement conferences and extensive discovery

(See 29 RCNY § 1-06(j)(2)(ii) (Lexis 2018). An eight-day trial was held during which the

parties presented the testimony of 24 witnesses and offered documentary evidence.

For the reasons below, I find that the Building is an IMD and units 204, 205, 301, 302,

304, 402, 403, and 406 are covered by the Loft Law. I further find that petitioners are the

protected occupants of the above respective units.

PROCEDURAL HISTORY

On July 6 and 10, 2015, 11 of the above named petitioners filed a coverage and protected

occupancy application with the Loft Board for 9 units in the Building. On August 14, 2015 the

owner filed an answer, asserting a general denial and alleging that the applicants do not qualify

for protection. On July 20, 2016, on consent, applicants filed a second amended application

adding two additional applicants and units (ALJ Exs. 1, 2). On August 16, 2016, the owner filed

an answer to the second amended application asserting among other defenses, that the applicants

claiming coverage are not the prime lessees of their units (ALJ Ex. 2). On January 27, 2017,

applicant Miller withdrew his claim for coverage and protected occupancy with prejudice (ALJ

Ex. 4). The trial proceeded with petitioners asserting coverage and protection of the following

10 units and 12 individuals:

Unit 204 (Ms. South)

Unit 205 (Mr. Small and Mr. Cohen)

Unit 301 (Ms. Russell)

Unit 302 (Mr. and Ms. Noci)

Unit 303 (Ms. Junek)

Unit 304 (Mr. Peckham)

Unit 402 (Mr. Baer)

Unit 403 (Mr. Matthew)

Unit 405 (Mr. Verma)

Unit 406 (Ms. Koseogullari)

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ANALYSIS

The premises are two buildings designated as 394-400 South 2nd

Street located on

adjacent lots in Brooklyn, and were erected around 1900. One building is four stories while the

larger adjacent building is five stories. Neither building has a certificate of occupancy. From

1999 to 2015, the buildings were owned under one deed by 4 Zero S. 2nd

St. Corp., whose

principal was Isaac Dahan (Resp. Ex. D). The current owner, 400 South 2nd

Street Holdings,

L.P., purchased the buildings in 2015 and again the buildings were conveyed in a single deed

(Pet. Exs. 1, 2; Resp. Ex. C; Tr. 1233). The principals of 400 South 2nd

Street Holdings, L.P. are

Mr. Strulovitch and Mr. Perlmutter (Tr. 1243-45).

The Building was occupied as a factory prior to 1999. According to one witness, in the

early 1990’s the second floor was leased by a Chinese garment manufacturer (Thomas: Tr.

1159). Beginning around 2000, various floors in the Building were converted into rental

apartments. Jeanine Gerding testified that she leased the entire fourth floor at the Building from

1999 to May 2015 from Mr. Dahan (Tr. 364). After taking the lease, she, Chuck Thomas and

David Dubois intended to convert that open factory space into seven apartments (Tr. 365). Mr.

Thomas testified that, at the suggestion of Ms. Gerding, he and Mr. Dubois agreed to lease

various floors from the owner and build apartments to rent (Tr. 1155). They initially built seven

residential lofts on the fourth floor with kitchens and bathrooms (Tr. 1156-57). Mr. Thomas,

himself, lived in unit 407 beginning in 2001 (Tr. 1158). Mr. Dubois took the lease for the second

floor in 2001 and built five residential units with kitchens and bathrooms (Tr. 1159-61). In 2004,

Mr. Thomas helped Mr. Dahan build six residential units on the third floor (Tr. 1162-63).

Sometime later, residential units were also built on the fifth floor (Thomas: Tr. 1164).

Mr. Thomas indicated that the residential tenants would contact him, Ms. Gerding, or Mr.

Dubois if any repairs were needed (Tr. 1166). Ms. Gerding and Mr. Thomas also paid the

utilities and billed the tenants for their share of the utility bills (Tr. 1168-69). Repairs to the roof

and exterior of the Building were handled by Mr. Dahan (Tr. 1167).

On September 10, 2009, the Department of Buildings (“DOB”) issued a vacate order for

the Building due to fire and safety violations and all of the tenants were forced to leave the

Building. The violations included the absence of secondary means of egress and fireproof doors

and the use of open-flame heaters (Thomas: Tr. 1174). Following the issuance of the vacate

order, Ms. Gerding, Mr. Dubois, and Mr. Thomas installed forced air heaters and metal doors

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and Mr. Dahan built a fire escape (Tr. 1174, 1208-09). The tenants were not allowed to return to

the Building until November 9, 2009 (Seiler: Tr. 23-24; Russell: Tr. 145; Thomas: Tr. 1173).

The 2010 amendments to the Loft Law define “interim multiple dwelling” as a building

that: (1) at any time was occupied for commercial purposes; (2) lacks a certificate of occupancy

pursuant to section 301 of this chapter; (3) is not owned by a municipality; and (4) was occupied

for residential purposes by three or more families living independently from one another for a

period of twelve consecutive months during the period commencing January 1, 2008, and ending

December 31, 2009 (“window period”), provided that the unit (i) is not located in a basement and

has at least one entrance that does not require passage through another unit to obtain access to

the unit, (ii) has at least one window opening onto a street or yard, and (iii) is at least 400 square

feet in area. MDL § 281(5) (Lexis 2018).

Prior to the trial, the parties stipulated that all of the foregoing requirements, with the

exception of proof of residential occupancy by the applicants, were met (ALJ Ex. 4).

Unit 204

Jordan Seiler testified that he lived in unit 204 from 2003 to 2014. He signed a lease with

either Mr. Thomas or Mr. Dubois, who he understood to be the landlord (Tr. 21, 47). Mr.

Thomas confirmed that Mr. Dubois entered into a residential lease with Mr. Seiler in 2003 (Tr.

1185-87). The rent was paid by check to Mr. Dubois and the utilities to Mr. Thomas (Tr. 22, 45-

46).

When Mr. Seiler moved in, the unit had a bathroom with a tub, shower, sink and toilet.

He built two bedrooms and a storage room/bedroom. The kitchen had a sink, stove, refrigerator

and some shelving. The unit remained unchanged until he moved out in late 2014 or early 2015

(Tr. 20).

Natalie South testified she moved into unit 204 after relocating from Texas to New York

in July 2004. According to Ms. South, in July 2004 the unit consisted of a kitchen with a sink,

stove, refrigerator and shelving, a common area with sofas and a dining table and a bathroom

with a sink, toilet and bath/shower. There were three bedrooms furnished with beds and dressers

(Tr. 743). During the eleven years she has lived in the unit she occupied different bedrooms.

Only two of three bedrooms are currently occupied (Tr. 745).

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Ms. South and Mr. Seiler both testified that the rent was split among the roommates and

paid by check, money order or cash and paid to Mr. Dubois (Seiler: Tr. 23; South: Tr. 745-46).

Neither Ms. South nor her roommates ever had electricity or gas accounts in their names. Mr.

Thomas left a note on the unit door with the amount for the electric and gas owed and they paid

him (Tr. 745-46, 776). This arrangement continued until the Building was sold to the current

owner in 2015 (Tr. 746). Now, Ms. South pays the rent by check or through an automated

checking service (Tr. 747).

Ms. South testified she paid her cellphone bill in cash until she got a checking account in

2013 (Tr. 776-77). Prior to 2013, she used a checking account in Texas (Tr. 779).

Ms. South and Mr. Seiler explained that when she moved into the Building, the unit did

not have a designated mailbox and all of the mail was piled on the floor near the entrance (South:

Tr. 748; Seiler: Tr. 23, 24). She and Mr. Seiler therefore used Mr. Seiler’s mother’s address on

Tenth Avenue in Manhattan to receive mail. Mr. Seiler picked up Ms. South’s mail since he had

an art studio at that address and went there daily (South: Tr. 750, 780-81; Seiler: Tr. 24, 31).

Even though Ms. South used the Tenth Avenue address on her 2008, 2009 and 2010 federal and

state income tax returns, she denied that she ever lived at this address (Tr. 750). She stopped

using the Tenth Avenue address in 2013 or 2014 and began receiving mail at the Building (Tr.

751).

Ms. Ellerbrock, Mr. Seiler’s mother, testified that approximately nine months after her

son finished college, he moved from her home on Tenth Avenue to the Building, where he lived

for about 10 years (Tr. 52-53). She confirmed that her son and Ms. South used her address to

receive mail, although neither actually resided there (Tr. 55).

Ms. South testified that she has been employed as a hairstylist ever since moving into the

Building (Tr. 251). During 2008, 2009 and 2010, Ms. South did some hairstyling in her unit,

mostly for friends, approximately one time per month (Tr. 754-55).

Mr. Bonan, who lived in unit 203 from 2003 until 2012, testified that Ms. South lived in

unit 204 (Tr. 58). He visited her unit about 15-20 times per year for social occasions, saw her

walking her dog daily and going to and coming home from work. He knew she was a hairstylist

and occasionally she cut his hair in her unit (Tr. 61).

Mr. Bonan confirmed there were security issues with regard to the mail delivery and

testified that he had obtained a post office box for important mail (Tr. 65-66). He submitted a

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few documents addressed to him at the Building from 2010 (Pet. Exs. 4, 8-9) and his 2008 and

2010 federal income tax returns with the Building address (Pet. Exs. 10-11).

Ms. Gerding, the prime lessee for the fourth floor, visited Ms. South in unit 204 during

2008 and 2009 and observed there were two or three bedrooms (Tr. 384). Mr. Thomas also

confirmed that Ms. South has resided in unit 204 since 2003 (Tr. 1183). Mr. Small, the tenant in

unit 205, testified that Ms. South resided next door to him in the Building and he was aware of

her comings and goings. Because they were in a relationship for six months, he spent time in her

unit (Tr. 802).

Ms. South submitted the following documentation showing her address as unit 204 in the

Building: 1) January 29, 2016 New York State Driver License (Pet. Ex. 118); 2) January 29,

2016 registration with the Board of Elections in the City of New York (Pet. Ex. 3; Tr. 760); 3)

March 7, 2016 Quest Diagnostics, Inc. invoice (Pet. Ex. 119); 4) May 1 to May 31, 2016 TD

Bank statement (Pet. Ex. 120; Tr. 760); 5) July 22, 2016 Chase credit card statement (Pet. Ex.

121; Tr. 160 ) and 6) a June 23, 2016 check from Takamichi Hair Salon (Pet. Ex. 122). She also

presented several pages of veterinary clinic records dated February 9, 2016 (Pet. Ex. 123),

showing treatment for a dog from 2007 to 2014 (Pet. Ex. 123).

Ms. South identified eleven undated photographs of the unit as it existed on or around

July 2015 and testified that the living area, bathroom, bedrooms, foyer and kitchen layouts were

basically the same in 2008, 2009 and 2010 (Pet. Ex. 124 (A-K); Tr. 764-69).

Unit 205

Mr. Small and Mr. Cohen testified that they moved into unit 205 in August 2003 (Small:

Tr. 795; Cohen: Tr. 874) after seeing an advertisement on Craigslist (Tr. 824). Upon viewing the

unit, Mr. Small asked Mr. Thomas, who was showing the apartment, whether he could “gut” the

apartment since it “had some really terrible walls separating the space.” According to Mr. Small,

Mr. Thomas was “very enthusiastic about the plan” (Tr. 796). Mr. Small and Mr. Cohen

arranged to rent the unit from Mr. Thomas and Mr. Dubois (Cohen: Tr. 876), signing a

residential lease (Pet. Ex. 151) for a one-year term (Tr. 888).

Within weeks of moving in, Mr. Small and Mr. Cohen tore everything down and

reconfigured the space into two bedrooms, one without a window, finishing in October 2003.

They did no structural work to the existing bathroom, which had a toilet, shower, and sink, but

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made a few cosmetic changes (Tr. 797-98). The kitchen had a sink, refrigerator, stove and

shelving. Mr. Small installed kitchen cabinets and built custom bookshelves to hold his books

and collection of miniature figurines. No further structural changes were made to the

apartment’s configuration (Tr. 799, 837-38).

Beginning in 2003, Mr. Cohen wrote the rent check to Mr. Dubois, and Mr. Small paid

his portion of the rent to Mr. Cohen in cash. Since 2015, Mr. Cohen has paid his rent by credit

card through a website and Mr. Small has sent him a check in the mail (Small: Tr. 801; Cohen:

Tr. 938-39). Mr. Small paid the utilities based upon bills left on his door by Mr. Thomas (Tr.

799-800) and would inform Mr. Thomas if repairs were needed (Tr. 826).

Since 2001, Mr. Small has been employed as an office manager for a rooftop gardening

firm in New York City (Tr. 804). Mr. Small testified he had no other residence since moving

into the Building in 2003, other than the temporary arrangements he made when the tenants were

forced to vacate for two months in 2009 (Tr. 803). Mr. Small stated that when he moved into the

unit, the mail for the Building was placed in a pile. Mailboxes were not installed until after

2009. Nevertheless, he received his driver’s license and Verizon bills at the Building (Tr. 840-

41). From 2001 to 2016 he did not have a bank account and paid his bills in cash (Tr. 829-30).

Mr. Small identified four photographs of unit 205 taken in 2016 (Pet. Ex. 130; Tr. 818-19),

showing his bedroom and living room (Tr. 819-22). Mr. Small testified that he has not filed

federal or state income taxes since the “Iraq war started” in 2002 (Tr. 808, 832).

Mr. Cohen testified that from 2003 to 2013 he worked as a chief engineer at a post-

production company located in lower Manhattan (Tr. 877-78). He resided exclusively in the unit

except during the vacate period, when he lived nearby with his sister and also with a friend (Tr.

883). Like Mr. Small, Mr. Cohen used his employer’s address for his mail due to the security

problems with the mailboxes (Tr. 916, 949-50).

Mr. Cohen stated that after 2013 he was unemployed until June 2015, when he began

working as a systems engineer for a company in Los Angeles, California (Tr. 878-79). When he

left New York in May of 2015, he took his computers and some clothes and moved into an

unfurnished rental apartment in Santa Monica (Tr. 884, 939), but left his books, records, CDs,

bed, desk, and chair in the unit (Tr. 881). He indicated that he originally intended to work in

California for only three months but then stayed “a little bit longer” (Tr. 880) and signed a year-

long contract (Tr. 938). He then went to work for another company in California where he still

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works. When this job ends, he intends to return to unit 205 at the Building (Tr. 880). Since

beginning work in Los Angeles in 2015, he has returned to unit 205 only four times (Tr. 882).

Mr. Cohen entered into two one-year leases on the Santa Monica apartment (Tr. 940-41).

He insisted that he hates Los Angeles because it is always sunny and is filled with poor drivers

and people who snub those who don’t own cars (Tr. 944).

Mr. Katz, the Building manager since 2015, testified that he never saw Mr. Small in the

Building prior to October 2016 and has never seen Mr. Cohen in the Building (Tr. 1237-38).

Mr. Small presented the following documents showing his address as unit 205 at the

Building: 1) 2007 and 2015 New York State Driver Licenses (Pet. Ex. 125); 2) 2008 New York

State motorcycle learner’s permit (Pet. Ex. 125); 3) W-2s for 2008, 2009 and 2010 from his

employer (Pet. Exs. 126-128); 4) Verizon account history from August 2010 to March 2016 (Pet.

Ex. 129) and 5) a record of his voter registration as unit “5” from 2004 to 2016 (Pet. Ex. 3).

Mr. Cohen provided the following documents showing his address as second floor #5 or

unit 205 at the Building: 1) July 22, 2003 residential lease (Pet. Ex. 151); 2) copies of 2008,

2009, 2011 and 2013 New York State income tax returns (Pet. Exs. 152-155) and 3) 2004 and

2012 New York State Driver Licenses (Pet. Exs. 157, 158). Mr. Cohen also provided a 2013 W-

2 form with the Building address but no unit number (Pet. Ex. 156).

Mr. Cohen presented four photographs (Pet. Ex. 159) of the unit taken by Mr. Small in

2016 which showed Mr. Small’s bedroom, his bedroom, their desks, and the kitchen which

represent the way the unit has looked since 2003 (Tr. 920, 926-30).

Unit 301

Ms. Russell testified she moved into unit 301 in October 2003, leasing the space from

Mr. Dahan. At that time, the unit was an empty space with the beginnings of a kitchen,

consisting of a stove, counter and sink. A refrigerator was installed later by the landlord. The

bathroom contained a tub, sink and toilet (Tr. 139). During 2009, when the tenants were forced

to vacate, Ms. Russell lived with friends (Tr. 145).

Between 2008 and 2010, Ms. Russell worked for a clothing store in SoHo and was a part-

time actress (Tr. 141-42). In 2008, 2009, and 2010 she used the unit from May through July

each year for pre-production work on a film she was making. This included rehearsals, readings

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and production meetings. After the summer of 2010, she used the unit for her work for only a

day or two a month (Tr. 142-44).

Mr. Bonan, a former tenant of unit 203, testified that Ms. Russell was his neighbor in unit

303 or 302 from 2005 until 2012, when he left the Building (Tr. 62). He visited her many times

from 2005 to 2012, had dinner with her in the unit, and spent holidays together. He saw her go

to work in the morning and come home at night (Tr. 63).

Ms. Russell provided the following documents showing her address as unit 301 at the

Building: 1) copies of 2008 federal, state and city income tax returns (Pet. Ex. 12); 2) copies of

2009, 2010 and 2015 federal income tax returns (Pet. Exs. 13, 14, 18); 3) April 15, 2009

marriage certificate (Pet. Ex. 19); 4) June 14, 2004 debt management letter (Pet. Ex. 20); 5) 2008

to 2009 rent and utility checks payable to 400 S. 2nd

Street Corp. (Pet. Ex. 21); 6) June and July

2009 Citibank statements (Pet. Ex. 22); 7) February, May, July, and August 2009 Direct TV bills

(Pet. Ex. 23); 8) June 2009 New York State Driver License (Pet. Ex. 24); 9) January through

April 2009 pay stubs (Pet. Exs. 25, 26 ); 10) July 2009 immigration application receipt (Pet. Ex.

27); 11) January 2008 to August 2010 and January 2011 to February 2011 investment statements

(Pet. Ex. 28); 12) March to August 2009 Verizon statements (Pet. Ex. 29) and 13) Voter

registration records showing her voting address as unit 301 from 2004 to 2012 (Pet. Ex. 3).

Ms. Russell also provided 10 photographs of her unit taken in 2016 depicting a kitchen,

dining room, bedroom and bathroom (Pet. Ex. 30). Ms. Russell testified that these photographs

represent her unit’s configuration in 2008-2009 (Tr. 162-171).

Unit 302

Mentor Noci testified that he moved into unit 302 with three of his friends in 2004 (Tr.

162-171) from campus housing at Pratt Institute (Tr. 1044, 1046, 1049). At that time, the unit

contained a kitchen with a stove, refrigerator, sink and cabinets, and a bathroom with a toilet,

sink, and bathtub (Tr. 1047). After moving in, Mr. Noci and his roommates created four

bedrooms (Tr. 1048).

Mr. Noci married Julie Puaux in 2012. She has been living in unit 302 since the summer

of 2008 (M. Noci: Tr. 1045, 1050; J. Noci: Tr. 1121). After Ms. Noci moved in, they

reconfigured the unit to have only one bedroom (Tr. 1057). They signed a one-year lease with

Mr. Dahan in 2011 (Pet. Ex. 182; Tr. 1067-71).

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Since 2004, Mr. Noci has worked as an architect at an architectural firm in Greenpoint,

Brooklyn (Tr. 1051-52). Ms. Noci testified that she was not employed until 2012, when she

became a permanent resident. Since then she has worked as an architect at a firm located in

lower Manhattan (Tr. 1139).

Mr. Noci did not receive mail at the Building until the mailboxes were installed in 2009

or 2010 (Tr. 1055-56).

Mr. Noci provided the following documents showing his address as unit 302 at the

Building: 1) January, April, and October 2008; January and July 2009; June 2010 Citibank

statements (Pet. Ex. 179); 2) February 10, 2012 marriage certificate (Pet. Ex. 180); 3) September,

October, and December 2008; January, March, and October 2009; May and June, 2010

American Express statements (Pet. Exs. 181, 199(b)); 4) November 7, 2011 extension of lease

agreement (Pet. Ex. 182); 5) 2010 Form 1099-MISC (Pet. Ex. 183); 6) copies of 2010, 2011,

2012 and 2015 federal income tax returns (Pet. Exs. 184-186, 190); 7) 2014 W-2 Form (Pet. Ex.

187); 8) NYC Identification Card with no issuance date that expires in 2020 (Pet. Ex. 188); 9)

March 20, 2012 New York State Driver License (Pet. Ex. 189) and 10) a 2012 voter registration

record (Pet. Ex. 3).

Ms. Noci provided the following documents showing her address as unit 302 at the

Building: 1) 2008 New York State Department of Motor Vehicles Interim Visitor Identification

Card (Pet. Ex. 192); 2) copy of 2009 federal income tax return (Pet. Ex. 193); 3) November 19,

2009 letter from Chase Bank (Pet. Ex. 194); 4) 2009 W-2 Form (Pet. Ex. 195); 5) 2016 student

loan interest statement (Pet. Ex. 196); 6) July 8, 2016 American Express statement (Pet. Ex.

197(a)); 7) 2014 W-2 Form (Pet. Ex. 198) and 8) a NYC Identification Card with no issuance

date that expires in 2020 (Pet. Ex. 199).

Mr. Noci submitted 16 photographs (Pet. Ex. 191) taken in 2008, 2009, and 2016

showing the living area, a kitchen, bedroom, bathroom, a desk and storage area (Tr. 1074-78,

1082-90).

Unit 303

Mr. Bedolla testified that he and a friend lived in another unit in the Building for

approximately two years before moving into unit 303 in 2004 (Tr. 94). They entered into a one-

year lease with the landlord, Mr. Dahan. The lease was renewed in writing after the first year

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(Tr. 95, 97), and afterwards they had a month to month agreement. When Mr. Bedolla first saw

unit 303 it had two bedrooms, a bathroom with a walk-in shower, sink and toilet, and a small

kitchenette with a stove, sink and refrigerator (Tr. 96).

Mr. Bedolla stated that in 2004, the mail for the Building was delivered and put in a large

cardboard box, which he had to sort through to get his mail, until 2009 when mailboxes were

installed (Tr. 98, 115). The Building had no procedure for tenants to receive packages (Tr. 117).

Around 2006 or 2007, Mr. Bedolla moved out of the Building and sublet the unit to three

different subtenants through residential subleases (Tr. 96). Monthly rent checks from the

subtenants were sent to Mr. Dahan (Tr. 96, 97). The subtenants’ rent was more than Mr. Bedolla

paid Mr. Dahan, and also covered all utilities including internet service (Tr. 118, 122). Between

2007 and 2009, Mr. Bedolla visited unit 303 once or twice a year if needed by the subtenants,

and to assess the value of a subtenant’s security deposit when a subtenant moved out (Tr. 100,

102-103). After the vacate order in 2009, Mr. Bedolla decided not to be responsible for the unit

and told Mr. Dahan he was giving it up (Tr. 99).

Mr. Thomas believed that Mr. Bedolla lived in unit 203 from 2004 to 2007 or 2008 and

started subleasing to other people (Tr. 1177). He confirmed that in 2008 the unit was a

“residential apartment” (Tr. 1177).

Ms. Junek testified that she moved into the Building with a roommate on December 1,

2009 (Tr. 195), signing a one-year lease with Mr. Dahan (Pet. Ex. 39). The lease is on a standard

loft lease form for “Apartment # 303” which stated it was to be occupied as “an artist’s studio

and related office space.” Her lease was later extended (Tr. 195-96). Ms. Junek’s husband lived

with her in the unit for approximately six months (Tr. 196-97). She shared the unit with a

roommate who moved out after three years. In 2013, she found another roommate, who moved

out in July 2016 (Tr. 197).

When Ms. Junek first saw the unit, it contained a bathroom with a sink, vanity, shower

and toilet and a kitchen with a stove, sink, refrigerator and cupboards for plates and glasses (Tr.

195). There were two bedrooms separated by built in closets and a living area (Tr. 195). Both

she and her roommate moved a mattress and a dresser into the bedrooms (Tr. 208-09).

In 2009 and 2010, Ms. Junek was employed as a production coordinator by a film

production company located in Brooklyn (Tr. 199-200). From January 2011 to December 2014,

she was employed as a flight attendant for Delta Airlines, based at JFK Airport (Tr. 198-99).

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Since then she has been freelancing and working as a prop stylist with set design companies (Tr.

199). In 2015, Ms. Junek filed a Schedule C with her federal income tax return reporting income

from “event production” and listing her business address as unit 303 at the Building (Pet. Ex.

36). The return indicates she started the business prior to 2015.

Mr. Thomas confirmed that Ms. Junek has been living in unit 303 since December 1,

2009 (Thomas: Tr. 1176). According to Ms. Russell, at the time of the September 2009 vacate

order there were people living in unit 303 at the Building (Russell: Tr. 149). She spoke to a

person who came out of the unit on that day and said something to the effect of “I just got here”

(Tr. 150).

Ms. Junek provided the following documents showing her address as unit 303 at the

Building: 1) 2009, 2010, 2012, 2013, 2014, and 2015 federal and state income tax returns (Pet.

Exs. 31- 36; Tr. 200-02); 2) Chase bank statements from November 2009 through December

2010 (Pet. Ex. 37); 3) November 30, 2009 cancelled check for her security deposit (Pet. Ex. 38)

and 4) a December 1, 2009 lease (Pet. Ex. 39; Tr. 202-03).

Ms. Junek submitted undated photographs of her unit taken in 2013 or 2014 (Tr. 204).

She testified that the only difference between how the unit looked from 2009 to 2016 was that

the bathroom was repainted and tiled and a wood countertop was added to the kitchen (Pet. Ex.

40 (A-F); Tr. 203-10).

Unit 304

Joseph Woolridge testified, after living in unit 405 for six years, he moved into unit 304

pursuant to a July 1, 2004 one-year lease with Mr. Dahan of “Apartment 304” for an “artist’s

studio and related office space” which was extended several times to February 28, 2011 (Pet.

Exs. 160, 162). Mr. Thomas confirmed that Mr. Woolridge lived in unit 304 in the “early

2000’s” (Tr. 1178-79).

Mr. Woolridge stated that from 2008 to 2009 he was employed as a painting technician at

Cooper Union and did not perform any work at the Building (Tr. 1006). He paid the landlord for

electricity and gas service (Tr. 1008-09). Due to the vacate order, he moved out of unit 304 in

2009 (Tr. 970-71).

In addition to the 2004 lease, Mr. Woolridge produced the following documents showing

his address as unit 304 at the Building: 1) 2006 and 2009 lease extensions (Pet. Exs. 161, 162);

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2) 2005 rent checks for unit 304 made out to 400 South 2nd

Street Corp. (Pet. Ex. 163 (A, F, J,

K)); 3) January and February 2008 bank statements (Pet. Exs. 164, 168); 4) November 2009

Social Security statement; 5) two 2008 GBS medical statements (Pet. Exs. 166, 169); 6)

December 2007 IRS notice (Pet. Ex. 167); 7) 2008 retirement statement (Pet. Ex. 173); 8)

January through March 2009 Equity Trust invoice (Pet. Exs. 175, 176) and 9) an April 2009

Verizon bill (Pet. Ex. 178).

Mr. Woolridge provided several additional documents with the Building address but no

unit number: 1) December 2008 retirement statement (Pet. Ex. 170); 2) 2008 W-2 Form (Pet. Ex.

171); 3) 2008 Social Security statement (Pet. Ex. 172) and 4) March 2009 retirement statements

(Pet. Exs. 174, 177).

John Marc Peckham testified that he moved into unit 304 on December 1, 2009 (Tr. 661).

He leased the unit from Adam Baer, the tenant of unit 402, pursuant to a one-year lease labelled

a “residential lease” for “Apartment #304, the West Bedroom” and “the common areas of the

loft” (Pet. Ex. 109). This arrangement was confirmed by Mr. Baer (Tr. 254). The unit contained

three bedrooms, a living room, kitchen and bathroom. The kitchen consisted of an oven,

refrigerator, sink and counter space. The bathroom had a shower, sink and toilet. The unit’s

configuration has remained the same since 2009 (Tr. 662).

Mr. Peckham and Mr. Baer signed new one-year leases through the end of 2014 (Pet.

Exs. 110, 111). After moving into unit 304, Mr. Peckham rented out the extra bedrooms to

roommates (Tr. 721-22). When roommates moved out, he and Mr. Baer would place an ad on

Craigslist (Tr. 663). Mr. Peckham assumed “full control” of unit 304 after the sale of the

Building to the new owner in 2015 (Tr. 664).

Since 2009, Mr. Peckham has been employed as a server at a restaurant across from

Grand Central Station in Manhattan. He is also an artist and musician.

Even though he acknowledged there was a mailbox in the Building, Mr. Peckham

testified that after moving into the Building, he used a mailbox service located on 43rd

Street in

Manhattan as his mailing address. He testified that he did this because he did not think the

Building’s mailboxes were secure, since the front door was never locked (Tr. 665, 723). In

2011, he also obtained a post office box at Grand Central which he continues to use (Tr. 666-67).

He used the mailbox address and the post office box number for all of his tax returns since 2009.

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Mr. Baer testified that he visited Mr. Peckham in unit 304 in 2009 and 2010. He

observed that the unit was Mr. Peckham’s “home” where he occupied one bedroom with

roommates in the other two bedrooms (Tr. 254-55). Mr. Thomas confirmed that Mr. Peckham

has lived in unit 304 since 2009 (Tr. 1159, 1199).

Mr. Peckham provided the following documents with unit 304 as his address at the

Building: 1) 2009, 2010, and 2013 residential leases (Pet. Exs. 109-111); 2) February 2016

college notice (Pet. Ex. 112); 3) 2016 medical school mailing (Pet. Ex. 113); 4) March 2013 New

York State Driver License (Pet. Ex. 115) and 5) an April 2012 health care referral (Pet. Ex. 117).

Mr. Peckham provided 12 photographs of his unit showing a loft bed, a table and chairs,

a kitchen with a stove, refrigerator, and sink, and a bathroom with a shower (Pet. Ex. 116).

Unit 402

Mr. Baer testified that he moved into unit 402 in November 2005 (Tr. 249), leasing the

unit from Ms. Gerding, Mr. Dubois, and Mr. Thomas (Tr. 249).

When Mr. Baer moved in, the unit had four bedrooms, a kitchen with a stove and

refrigerator, and a bathroom with a sink, bathtub, and toilet (Tr. 251). Mr. Baer performed a

“gut” renovation to create three bedrooms instead of four, a concrete kitchen counter, a bigger

stove, and a larger refrigerator (Tr. 251).

Mr. Baer stated that another tenant had a mailbox labeled 402, so he created a new

mailbox for himself labeled 408, even though this unit number did not exist (Tr. 249-50). After

the September 2009 vacate order, he was given mailbox number 402 (Tr. 249-50, 263, 402).

From 2008 to 2016, Mr. Baer worked as a location scout and manager for film,

television, and advertising production (Tr. 251, 253). Mr. Baer also worked on photography and

video projects in the unit (Tr. 252).

Mr. Baer acknowledged amending his 2012, 2013, and 2014 income tax returns in 2016

and changing his address from unit 408 to unit 402 (Tr. 266-67). He stated that the primary

reason for the amendments was to correct the percentage of the space used for his “artmaking”

(Tr. 325-26).

Ms. Gerding testified that she was in unit 402 from 2008 to 2015 and observed that Mr.

Baer lived there (Tr. 374).

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Mr. Baer provided the following documents showing his address as unit 402 at the

Building: 1) January 2016 New York State Driver License (Pet. Ex. 41) and 2) copies of 2013,

2014 and 2015 amended federal and state income tax returns (Pet. Exs. 46-48).

Mr. Baer provided the following documents showing his address as unit 408 at the

Building: 1) copies of 2009, 2010, 2011, and 2012 federal and state income tax returns (Pet. Exs.

42-45); 2) January through April, July through November 2008, January, May, June, October

and November 2009, January through April and June 2010 Citibank credit card and bank

statements (Pet. Ex. 49); 3) May and June 2010 AT&T statements (Pet. Ex. 50); 4) January

through December 2009, January and June 2010 Capital One statements (Pet. Ex. 51); 5)

November and December 2009 and January through June 2010 Discover Card statements (Pet.

Ex. 52); 6) February 27, 2009 EverBank statement (Pet. Ex. 54); 7) May 2, 2010 Institution for

Family Health statement (Pet. Ex. 55); 8) June 30, 2008 Connecticut Pathology Laboratories test

results (Pet. Ex. 56); 9) June 2010 voided checks from Lunch Wagons Wars and PPI-Production

Processing Inc. (Pet. Ex. 57); 10) September 10, 2009 and February 24, 2009 invoices from New

York Shakespeare Festival (Pet. Ex. 58); 11) January 30, 2010 check from Hudson Opera House,

Inc. (Pet. Ex. 60); 12) October 30 and November 21, 2010 pay stubs from Entertainment Partners

(Pet. Ex. 60); 13) October 24, 2008 EverBank deposit receipt (Pet. Ex. 61); 14) July 1, 2010

United Healthcare invoice (Pet. Ex. 62); 15) May 20, 2010 internet service invoice (Pet. Ex. 63);

16) January 9, 2008 Sports Therapy and Rehab invoice (Pet. Ex. 64); 17) March 5 and 8, 2010

receipts from 88th

Street Apothecary (Pet. Ex. 65); 18) March 2010 PADI Validation Card (Pet.

Ex. 66); 19) July 2008 and February 2009 NYS Department of Labor letters (Pet. Exs. 67, 68);

20) June 19, 2008 State of New York Insurance Department letter (Pet. Ex. 69) and 21) a Voter

and driver license registration application showing a December 2015 change of address from 9

Richbell Road, White Plains, New York, where Mr. Baer voted in 2008, to unit 402 at the

Building (Pet. Ex. 3).

Mr. Baer submitted two documents, an April 2010 travel itinerary (Pet. Ex. 53) and an

August 28, 2011 e-mail to John Marc Peckham (Pet. Ex. 70) with the Building address but no

unit number. Mr. Baer provided photographs of his unit taken around 2011 showing how the

space appeared from 2008 through 2010 (Pet. Ex. 71; Tr. 295-301).

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Unit 403

Scott Matthew testified that he moved into unit 403 in the Building in 2004 after being

told about a vacancy by his friend, Ms. Russell (Tr. 550). He sublet the unit for a month or two

and then took over the unit under an agreement with Ms. Gerding and Mr. Dubois (Tr. 550-51).

When he initially saw the unit, it had a kitchen with a stove, shelves and refrigerator, a bathroom

with a tub, sink and toilet, and a bedroom and couch (Tr. 551).

Soon after he moved in, Mr. Matthew asked the owner for a mailbox key to receive mail

and was told by Mr. Dahan that there was no mailbox for unit 403. Mr. Dahan gave Mr.

Matthew a key to mailbox number 305 and Mr. Matthew used number 305 as his mailing

address, even though he never actually resided in unit 305 (Tr. 560). In 2011, he was given a

mailbox for unit 403 (Tr. 559-60). Mr. Matthew acknowledged that his 2008 and 2009 tax

documents show his unit as 305 and his returns from 2010 forward show his unit as 403 (Pet.

Exs. 81-87; Tr. 566-73). Ms. Gerding confirmed that Mr. Matthew lived in unit 403 from 2008

to 2015 (Tr. 375).

From 2004 to 2007, Mr. Matthew worked at a store with Ms. Russell (Tr. 551-52). Since

2007 he has worked primarily as a musician (Tr. 552), although he currently works at a Brooklyn

tea house (Tr. 554-55). He testified that in 2008, 2009, and 2010, he occasionally used his

apartment to rehearse and record demos (Tr. 553-54).

From 2008 through 2010, he left the country about two times a year for business, each for

two weeks. From 2011 to 2016, he traveled for work about three times per year (Tr. 557).

Mr. Matthew submitted the following documents showing his address as unit 305 at the

Building: 1) copies of 2008 and 2009 federal and state income tax returns (Pet. Exs. 81, 82); 2)

November 2009 statement from American Society of Composers, Authors and Publishers

(“ASCAP”) (Pet. Ex. 88); 3) August 3, 2009 letter from the IRS (Pet. Ex. 89); 4) August 2010

statement from ASCAP (Pet. Ex. 91) 5) August 4, 2010 letter from AT&T (Pet. Ex. 92) and 6)

2008, 2009 and 2010 Citibank statements (Pet. Ex. 94).

Mr. Matthew submitted the following documents showing his address as unit 403 at the

Building: 1) copies of 2010, 2011, 2012, 2014 and 2015 federal and state income tax returns

(Pet. Exs. 83-87); 2) December 15, 2011 Citibank Account screen printout (Pet. Ex. 93); 3) May

1, 2012 New York State Department of Taxation and Finance check stub (Pet. Ex. 95); 4) March

24, 2016 U.S. Citizenship and Immigration Services receipt of application (Pet. Ex. 96); 5)

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September 20, 2016 Board of Elections Approval Notice (Pet. Ex. 98); 6) NYC Identification

Card that expires on January 27, 2021 (Pet. Ex. 99); 7) February 28, 2011 letter from Southwest

Credit (Pet. Ex. 100); 8) August 20, 2012 IRS letter (Pet. Ex. 101) and 9) a June 18, 2012 IRS

invoice (Pet. Ex. 102). Mr. Matthew provided two documents, a 2009 T-Mobile statement (Pet.

Ex. 90) and an August 30, 2016 Certificate of Citizenship (Pet. Ex. 97), with the Building

address but no unit number.

Mr. Matthew identified photographs he took of his living room, kitchen, and bedroom

around the summer of 2016 (Pet. Ex. 103 (A-F); Tr. 581-584), and testified that the appearance

of the unit looked the same in 2008, 2009 and 2010 (Tr. 583).

Unit 405

Mr. Woolridge testified he first moved into unit 405 in the Building in 2001, sharing it

with three other people (Tr. 963-65). In 2005, he rented the space directly from Ms. Gerding (Tr.

967). He lived in unit 405 until about 2007, when he moved into unit 304, but continued to rent

unit 405 until 2009 and sublet it to residential occupants (Tr. 265). Mr. Thomas testified that in

2008 and 2009, unit 405 was rented out to various art and fashion design students for residential

occupancy with four rooms which resembled a dormitory (Tr. 1183).

Mr. Woolridge testified that unit 405 consisted of four bedrooms and a kitchen with a

refrigerator, sink and countertop. The bathroom had a standup shower, toilet and a sink (Tr.

963). The living room contained a couch, a small table and a television. In 2008, Mr. Woolridge

visited unit 405 at least once a month and observed people cooking and helped them move in (Tr.

968).

Koppel Verma testified he has lived in the Building in unit 405 since November 2009

(Tr. 609-10). He rented the unit from Ms. Gerding and moved in with two friends.

When he rented the unit it had a bathroom, four bedrooms, a living room, and a kitchen

with a stove, sink, refrigerator and shelving. The bathroom had a sink, tub, shower and toilet.

Mr. Verma added a new shower and sink. Some of the kitchen equipment has been replaced by

the landlord (Tr. 610-612, 615). In September 2012, he took down some walls and made it into a

two bedroom unit (Pet. Ex. 108 (A-G); Tr. 614, 633).

Mr. Verma’s former girlfriend, Elizabeth Rader testified via video from California, that

she resided with Mr. Verma in unit 405 from November 2009 to December 2011 (Tr. 445-49).

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Ms. Rader stated that Mr. Verma continued to reside in unit 405 from 2009 to the present (Tr.

451-52). Mr. Verma testified that his roommates moved out in 2010 and 2011 (Tr. 636).

When he moved into the Building in 2009, Mr. Verma was concerned about the security

of the mail delivery (Tr. 615, 636). He had his important mail sent to his parents’ home in

Massachusetts and would go there once a month to get it. He had bank statements delivered

electronically (Tr. 616, 640). In 2010, he changed his address to receive mail at the Building (Tr.

617).

Mr. Verma testified that in 2009 he worked as an analyst at Gartner Research in Stanford,

Connecticut (Tr. 618). In 2010, he began working as a research manager at a Manhattan media

company and in 2012 started working at Google (Tr. 619-21).

Bob Lugowe testified that he has known Mr. Verma since 2009 and visited him and his

roommates frequently from February 2009 to 2012 (Tr. 400). He stated that Mr. Verma lived in

the unit for that entire time (Tr. 403, 405).

Ms. Gerding testified that Mr. Woolridge lived in unit 405 from 2008 to 2009 (Tr. 377-

78). Mr. Verma lived in the unit from 2009 on (Tr. 376). Mr. Thomas testified that Mr. Verma

has lived in unit 405 since December 2009 (Tr. 1179). Mr. Thomas visited the unit about twice a

month because he is friends with Mr. Verma and observed that it was used as a residential

apartment (Tr. 1180). Mr. Baer testified that he observed Mr. Verma inside unit 405 during

2009, and saw bedrooms and a bathroom (Tr. 258).

Mr. Verma provided the following documents showing his address as unit 405 at the

Building: 1) July 2010 e-mail attaching a resume giving Mr. Verma’s address as unit 405 (Pet.

Exs. 104, 105); 2) 2009 W-2 Forms (Pet. Ex. 106) and 3) a November 2012 New York

Department of Motor Vehicles Identification Card (Pet. Ex. 107).

Mr. Verma provided photographs taken during the summer of 2016 which depict the

unit’s two bedrooms (Pet. Ex. 108 (A-G); Tr. 627-28). He testified that other than installing a

butcher block and shelving system in the kitchen, the layout is the same as when he moved into

the unit in 2009 (Tr. 635).

Unit 406

Juan Diaz testified that he lived in unit 406 from 2007 to 2009 (Tr. 241-42), renting the

space from Ms. Gerding (Tr. 243). Ms. Gerding confirmed that Mr. Diaz lived in unit 406 in

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2008 and 2009 (Tr. 381-82) and identified a 2006 “residential lease” between her and Mr. Diaz

(Pet. Ex. 80; Tr. 384). Mr. Diaz testified that in 2007, the unit had a kitchen with a sink, stove,

and refrigerator and a bathroom with a toilet, shower, and sink (Tr. 242). Mr. Thomas also

recalled Mr. Diaz living in unit 406 prior to 2009 (Tr. 1181).

Mr. Diaz indicated that he was a film editor and received mail at his office rather than at

the unit (Tr. 243-44). Mr. Diaz recalled meeting Ayca Koseogullari during the time he was

moving out (Tr. 244).

Ms. Koseogullari testified that she was born in Turkey (Tr. 334). She moved into unit

406 in July 2009 pursuant to a lease (Pet. Ex. 72) with Ms. Gerding, Mr. Dubois, and Mr.

Thomas for “apt # 406,” agreeing that Ms. Koseogullari would be the “sole occupant.” The

utilities were covered by her rent (Tr. 340). Ms. Gerding confirmed that Ms. Koseogullari

moved into the unit in 2009 and used it as a live-in studio (Tr. 381). When Ms. Gerding visited

Ms. Koseogullari there, she was working and playing with her cat (Tr. 383).

When Ms. Koseogullari moved into unit 406, it contained a kitchen with a stove, sink,

and refrigerator and a bathroom with a bathtub, sink, and toilet. The rest of the space was an

open studio (Tr. 332-33). When she moved in, Ms. Koseogullari had no mailbox but was given

one in 2010 (Tr. 333). Soon after Ms. Koseogullari arrived, the Building was vacated and she

returned temporarily to Turkey in 2009 (Tr. 333).

In 2011, Ms. Koseogullari married Alan Steele, who continued to reside in his own

apartment in SoHo (Tr. 335). Mr. Steele testified that he and Ms. Koseogullari divorced in

October 2016 (Tr. 506). During the marriage, Mr. Steele resided alone in an apartment on East

Houston Street (Tr. 506). He stated that he was an artist who worked out of his space, and they

lived apart because “it’s crucial that she still has her own identity and her own place” (Tr. 506).

He and Ms. Koseogullari had a joint bank account into which Mr. Steele placed “a regular

amount of money from time to time” (Tr. 516). He testified that Ms. Koseogullari stayed with

him at his apartment “maybe once or twice a month” and had weekly dinners there (Tr. 531).

According to Ms. Koseogullari, during the marriage, Ms. Koseogullari visited Mr. Steele

“occasionally” in his apartment (Tr. 335).

Ms. Koseogullari testified that since 2009 she has worked as a freelance graphic designer

going to “different places” to work (Tr. 338, 424). She also drew paintings and drawings in the

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unit and also in her husband’s studio (Tr. 425-26). She earned no money from this artwork in

either in 2009 or 2010 (Tr. 427).

Ms. Koseogullari stated that she filed no income tax returns for 2009, 2010, or 2011. In

2013 and 2014, she and Mr. Steele filed joint tax returns using Mr. Steele’s address (Tr. 337). In

2015 Ms. Koseogullari filed federal and state income tax returns giving her address as unit 406

(Pet. Ex. 78; Tr. 343).

Mr. Baer testified that he knows Ms. Koseogullari and saw her moving around in unit

406 from his window (Tr. 258). Mr. Thomas also confirmed that Ms. Koseogullari has lived in

unit 406 since 2009 (Tr. 1181-82).

Ms. Koseogullari provided the following documents showing her address as unit 406 at

the Building: 1) 2009 lease (Pet. 72); 2) NYC Identification Card that expires on October 5, 2021

(Pet. Ex. 73); 3) February, April, May, June, August and November 2010; December 2015;

March, April, May and August 2016 Citibank statements (Pet. Ex. 76); 4) 2016 State Farm

insurance account history (Pet. Ex. 77) and 5) copies of 2015 federal and state income tax returns

(Pet. Ex. 78).

Ms. Koseogullari provided a copy of a U.S. Permanent Resident Card issued on March

29, 2012 (Pet. Ex. 74) and a September 9, 2016 electronic case tracking e-mail (Pet. Ex. 75) with

the Building address with no indication of the unit number.

Ms. Koseogullari produced 14 photographs showing the unit as it looked in 2009, 2010

and 2016 (Pet. Ex. 79; Tr. 345-49, 414-23).

Coverage

To qualify for coverage under the 2010 amendment to the Loft Law, a building must

meet a number of requirements: (1) at any time have been occupied for manufacturing,

commercial, or warehouse purposes; (2) lack a certificate of occupancy or of compliance

permitting residential use on the qualifying unit on June 21, 2010; (3) not be owned by a

municipality; and (4) have been occupied for residential purposes as the residence or home of

three or more families living independently from one another “for a period of twelve consecutive

months” between January 1, 2008, and December 31, 2009 (“window period”). MDL § 281(5)

(Lexis 2018). The unit must also (i) not be located in a basement or cellar; (ii) have at least one

window opening onto a street or lawful yard or courtyard as defined in the zoning resolution for

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such municipality; (iii) have at least one entrance that does not require passage through another

residential unit to obtain access to the unit; and (iv) be at least 400 square feet in area. MDL §

281(5).

As noted above, many of the elements of Loft Law coverage, as well as the status of the

buildings on the two lots as a horizontal multiple dwelling, were stipulated to by the owner prior

to trial. The coverage issue contested at trial was whether the ten units were residentially

occupied during the 2008-2009 window period. To prove the residential occupancy of the units,

applicants must establish, by a preponderance of the evidence, “sufficient indicia of independent

living to demonstrate its use as a family residence,” plus some evidence “that the premises have

been converted, at least in part, into a dwelling.” Anthony v. NYC Loft Bd., 122 A.D.2d 725, 727

(1st Dep’t 1986); see 29 RCNY § 1-06(i)(4) (Lexis 2018); Matter of 180 Varick Street Corp.,

OATH Index No. 2049/04 at 6 n.1 (Oct. 29, 2004), adopted, Loft Bd. Order No. 2885 (Nov. 18,

2004). Residential occupancy may be established by direct testimony, as well as by “evidence of

indicia of residential living such as furniture, personal effects, and photographs of the unit being

used residentially.” Matter of Zhao, OATH Index No. 2225/14 at 8 (Aug. 12, 2015); adopted in

part, Loft Bd. Order No. 4445 (Nov 19, 2015); Matter of Gurkin, OATH Index No. 489/12 (Dec.

14, 2012), adopted, Loft Bd. Order No. 4186 (Oct. 17, 2013).

As to Ms. Russell in unit 301, Mr. and Ms. Noci in unit 302, and Mr. Matthew in unit

403, credible testimony and ample documentary proofs were provided to support findings that

these three units were residentially occupied for all of 2008 and 2009.

Units 204, 205, 304, 402, and 406 should also be found to have been residentially

occupied in 2008 and 2009 and therefore covered by the Loft Law.

Although contested in various ways by the owner, the credible testimony and

documentary evidence produced by Ms. South in unit 204, Mr. Small and Mr. Cohen in unit 205,

Mr. Woolridge and Mr. Peckham in unit 304, Mr. Baer in unit 402, and Mr. Diaz and Ms.

Koseogullari in unit 406 are sufficient to establish that these units were residentially occupied

during the window period. It was undisputed that, around 2000 to 2004, all of these units were

converted by Ms. Gerding, Mr. Thomas, and Mr. Dubois into loft apartments with kitchens and

bathrooms. All of the units except unit 406 had bedrooms and all were shown to have contained

beds. Units 204, 205, and 406 had residential leases. All of the witnesses who were present in

the Building in 2008 and 2009 agreed that these units were occupied residentially. In particular,

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Ms. Gerding and Mr. Thomas, individuals with no stake in the outcome of the adjudication,

credibly testified that the units were rented out as residential, not commercial spaces.

In the face of this substantial evidence of residential occupancy, the owner’s primary

argument that these individuals did not live at the Building concerns the failure of several tenants

to demonstrate receipt of mail at their respective units. It is true that Mr. Peckham, Mr. Baer,

Mr. Small, and Mr. Cohen did not receive most of their mail at their units.

However, the tenants’ decision to avoid using their units as a mailing address was

credibly explained. Virtually all of the witnesses who occupied the Building between 2000 and

2009 described the lax security for mail delivery at the Building. Ms. Gerding, the prime lessee

for the fourth floor, confirmed that there were no mailboxes for the individual units in 2000 (Tr.

370). Mr. Bedolla described the mail being piled in the entrance in 2004 (Tr. 113). Mr.

Woolridge testified that in 2004, there was a metal bin where everyone’s mail would be tossed

(Tr. 972). Mr. Thomas confirmed that mail delivery prior to 2009 was “pretty chaotic,” with all

the mail stacked in the entry like “garbage” and often not picked up (Tr. 1171). After repeated

warnings from the postal service, all of the residential units were given mailboxes in 2010 or

2011 (Tr. 1172-73).

Due to these problems with mail delivery, several tenants, including Ms. South in unit

204, Mr. Small and Mr. Cohen in unit 205, Mr. Noci in unit 302, and Mr. Peckham in unit 304,

used alternate addresses to receive mail. The fact that certain tenants chose to use alternative

addresses, where it was clear they did not reside, to receive mail is not an indication that they did

not live at the Building.

As to Mr. Baer’s use of an address of unit 408, a unit which did not exist, rather than unit

402, Mr. Baer credibly explained that this was a solution he worked out with the landlord due to

another occupant using a mailbox labeled 402. Since Mr. Baer produced numerous records

showing that he received mail at the Building, and there was no evidence that Mr. Baer stayed in

any unit other than unit 402, the fact that he used a mailbox with an incorrect label does not

undermine his proofs as to residential occupancy.

As to the remaining two units, 303 and 405, the proofs of continuous occupancy in 2008

and 2009 were thin. The current occupants, Ms. Junek and Mr. Verma, did not move into these

units until the latter part of 2009. The proof of how the units were occupied in 2008 and most of

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2009 depended entirely upon the testimony of two former tenants who did not live in the units

and were allegedly subletting them.

As to unit 303, Mr. Bedolla testified that, after moving out of unit 303 in 2006 or 2007,

he sublet the furnished unit to “successive tenants” (Tr. 99). He stated that he had written

subleases which he did not have “access to” (Tr. 99). Although he insisted it was only a matter

of days after his departure that the first subtenant took up occupancy (Tr. 98), he stated nothing

about how many tenants stayed in the unit, the names of any tenants, or how long the unit was

vacant between subleases.

Mr. Woolridge testified that, after he moved out of unit 405 in 2007, he found another

person to move into the bedroom that he vacated. He “maintained the lease” until 2009 (Tr.

967). He stated that in 2008 and 2009 unit 405 was a four bedroom apartment occupied by

various students who paid rent to Mr. Woolridge (Tr. 968). Mr. Woolridge was in the unit at

least once per month and observed the occupants cooking or watching television (Tr. 968-69).

He could not recall the names of any of the occupants of the unit after 2007 (Tr. 1007).

Notably, petitioners offered no documents to demonstrate that anyone resided in units

303 and 405 between January 2008 and November 2009. Prior cases indicate that conclusory

testimony of sporadic residential use, uncorroborated by any documentary evidence, is legally

insufficient to demonstrate continuous residential occupancy. In Matter of Romano, OATH

Index No. 2661/14 (Nov. 18, 2015), adopted, Loft Bd. Order No. 4459 (Jan. 21, 2016), a former

tenant moved out of a loft space prior to the window period and sublet the space to a series of

both commercial and residential tenants. She could recall the name of only one residential tenant

who lived in the unit for some unspecified time in 2006, 2007, or 2008. Due to the vagueness

and uncorroborated nature of the tenant’s recollections, Administrative Law Judge Lewis and the

Loft Board found that the applicants had failed to meet their burden of proving that the unit was

residentially occupied for 12 consecutive months and denied the coverage application. Similarly,

in Matter of 180 Varick Street Corp., OATH Index No. 2049/04 at 6-8 (Oct. 29, 2004), adopted,

Loft Bd. Order No. 2885 (Nov. 18, 2004), this tribunal and the Loft Board held that, in the

absence of proof that specific individuals resided in a unit throughout the window period, vague

testimony that someone lived in the unit and that the unit had residential amenities such as

showers or even dishwashers was insufficient to establish the continuous residential occupancy

necessary for coverage under the Loft Law.

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Under the 2010 amendment, a unit may be covered only where it is residentially occupied

independently for “twelve consecutive months” in 2008 and 2009. Under this language, it is fair

to conclude that an applicant for coverage has the burden of showing continued residential

occupancy for at least 12 months. By contrast, in the original statute, the window period was

defined as “on December first, nineteen hundred eighty-one . . . since April first, nineteen

hundred eighty.” Relying upon this language, the Loft Board held that, a vacancy of as long as

seven months did not disqualify a unit from coverage where the unit was residentially occupied

on both April 1, 1980, and December 1, 1981, and there was no evidence of a non-residential

use. See Matter of Tilkin, Loft Bd. Order No. 1219 (July 25, 1991); see also Matter of Chapin,

Loft Bd. Order No. 1466 (June 23, 1993) (testimony from occupants of other units that, after the

prime tenant left unit in mid-1981 a French woman was seen in the unit found sufficient to

support coverage where evidence showed residential occupancy at beginning and end of window

period).

In the instant case, the burden of proving 12 consecutive months of residential use was

met for most of the units because, even where there was no documentary proof for each

individual month in 2008 and 2009, the fact that some documentary proof from earlier and later

was provided supported an inference that the residential occupancy was continuous.

For units 303 and 405, however, there was no proof of a continuous residential presence

for 2008 and 2009. Instead, the only evidence of any occupancy consisted of conclusory

statements by the prime lessees that they recalled having unidentified subtenants. Based upon

prior cases, as well as the language of section 281(5), I find that this vague and uncorroborated

testimony is insufficient to support a finding that that these two units were residentially occupied

for 12 consecutive months.

For these reasons, I find that eight units, units 204, 205, 301, 302, 304, 402, 403, and 406,

should be covered by the Loft Law and that units 303 and 405 should not be covered.

Protected Occupancy

The standards for identifying the residential occupant qualified for protection under the

Loft Law are found in the Loft Board rules. First, under section 2-09(b)(1), the current occupant

in possession of an IMD is presumptively protected. The rules further state that if the current

residential occupant is not the prime lessee, then:

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the lack of consent of the landlord to a sublet, assignment or

subdivision establishing such occupancy does not affect the rights

of such occupant to protection under Article 7-C, provided that

such occupant was in possession of such unit prior to: . . . (iii) June

21, 2010, for an IMD unit covered by MDL § 281(5) . . . .

29 RCNY § 2-09(b)(2). A “prime lessee” is defined in the regulation as “the party with whom

the landlord entered into a lease or rental agreement for the use and occupancy of a portion of an

IMD, which is being used residentially regardless of whether such lessee is currently in

occupancy or whether such lease remains in effect.” 29 RCNY 2-09(a) (Lexis 2018).

The rules provide that occupants who took possession of their unit after June 21, 2010 are

qualified for protection only if they are “a prime lessee with a lease currently in effect,” “a

statutory tenant” who took possession with the consent of the landlord without a lease, the

assignee of a prime lessee consented to by the landlord, or prior to their occupancy the landlord

was offered an opportunity to purchase the improvements. 29 RCNY § 2-09(b)(3) (Lexis 2018).

Since 2014, the Loft Board has also required that former prime lessees must establish that

their units are their primary residence. This requirement is found in a collection of Loft Board

Orders reinterpreting the requirements for protected occupancy under section 2-09(b)(4) of its

rules. See Matter of Mignola, OATH Index Nos. 2482/11, 2483/11, 2484/11, 240/12, 808/12,

809/12, 810/12 & 1616/12 (May 29, 2013), adopted in part, rejected in part, Loft Bd. Order No.

4509 (Apr. 21, 2016); Matter of Schuss, OATH Index No. 2066/12 (Mar. 25, 2013), adopted in

part, rejected in part, Loft Bd. Order No. 4393 (May 21, 2015); Matter of Gallo, OATH Index

No. 2401/13 (Oct. 10, 2014), adopted in part, rejected in part, Loft Bd. Order No. 4349 (Jan. 15,

2015); Matter of Pak, OATH Index No. 2447/13 (Oct. 9, 2014), adopted in part, rejected in part,

and remanded, Loft Bd. Order No. 4334 (Nov. 20, 2014). Several recent decisions from this

tribunal have noted the questionable rationale and legal difficulties raised by these orders. See

Matter of Tenants of 151 Kent Avenue, Brooklyn, OATH Index Nos. 532/17, 533/17 at 7-9 (Nov.

22, 2017); Matter of Allweis, OATH Index No. 2569/14 at 28 (Jan. 18, 2017); Matter of Tenants

of 58 Grand Street, Brooklyn, OATH Index No. 212/15 (June 24, 2016), adopted, Loft Bd. Order

No. 4702 (Oct. 26, 2017). Even more recently, the Loft Board has characterized this divergence

of interpretations as to protected occupancy and primary residence as “the Loft Board position”

and “the OATH position.” Matter of Tenants of 79 Lorimer Street, Loft Bd. Order No. 4688 at

3-4 (Sept. 21, 2017).

- 26 -

Ms. South, Mr. Small, Mr. Cohen, Mr. Peckham, Mr. Baer, Mr. Matthew, and Ms.

Koseogullari are all subtenants, leasing their units from other prime lessees, and also moved in

prior to June 21, 2010. They are thus all presumptively protected occupants. Although I find

that units 303 and 405 should not be covered based upon the deficient proof of residential

occupancy in 2008 and 2009, I note that, should the Loft Board cover these units, Ms. Junek and

Mr. Verma also took occupancy as of June 21, 2010, and would be presumptively covered.

Ms. Russell and Mr. and Ms. Noci rented their units directly from the owner and are

prime lessees. They are required to prove primary residence under the recent Loft Board

interpretation of its rules. The Loft Board has declined to provide guidance as to the relevant

time period for proving primary residence. See Allweis, OATH 2569/14 at 27. As

Administrative Law Judge Zorgniotti noted, various Loft Board Orders have framed the issue of

primary residency in the present tense, which is consistent with the language in section 2-

09(b)(4) upon which the Loft Board relies. Id. at 27; see Mignola, Loft Bd. Order No. 4509 at 5

(finding that prime lessees currently in possession of an IMD unit must prove that the unit “is”

their primary residence); Matter of Tenants of 979-987 Dean Street, Brooklyn, OATH Index No.

1714/14 (Apr. 30, 2015), adopted in part, rejected in part, Loft Bd. Order No. 4533 at 4 (June

16, 2016) (finding that prime lessees must prove that their unit “is” their primary residence).

Thus, in making a finding of primary residency, Administrative Law Judge Zorgniotti found that

the applicants demonstrated that they occupied their unit as their primary residence since at least

the application filing date. Allweis, OATH 2569/14 at 31.

Most recently, in Matter of McKenna, Loft Board Order No. 4739 (Feb. 23, 2018), the

Loft Board focused on the application filing date by finding that a prime lessee with a lease in

effect on the date that the protected occupancy application was filed was a protected occupant.

By analogy, the most logical time frame for proof of primary residence would also be on the date

that the application for protected occupancy was filed.

Ms. Russell submitted her 2015 tax returns and stated that she has resided in unit 301

since 2003. There is no proof that she has had any other legal address since that date. This is

sufficient to find that, in July 2015, when her application for protected occupancy was filed, unit

301 was Ms. Russell’s primary residence. She is therefore entitled to be the protected occupant

of this unit.

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Likewise, Mr. and Ms. Noci submitted a November 2011 lease extension (Pet. Ex. 182),

showing that they were both prime lessees. Mr. Noci also submitted copies of a current driver’s

license and his joint 2015 tax returns with Ms. Noci. Ms. Noci submitted the 2015 joint tax

returns and a current New York City Identification Card, as well several mailed documents from

2016. No proof was offered that either Mr. or Ms. Noci has ever had any other address since

they moved into unit 302. This is similarly sufficient to find that, in July 2015, unit 302 was Mr.

and Ms. Noci’s primary residence and that they are therefore entitled to be the protected

occupants of this unit.

In sum, I recommend that petitioners’ coverage applications should be granted for units

204, 205, 301, 302, 304, 402, 403, and 406 at the Building, and denied for units 303 and 405. In

addition, the current occupants of the covered units should be recognized as protected occupants.

Susan J. Pogoda

Administrative Law Judge

September 7, 2018

SUBMITTED TO:

RICK D. CHANDLER, P.E.

Commissioner

APPEARANCES:

GOODFARB AND SANDERCOCK,

Attorneys for Petitioners

BY: MARGARET SANDERCOCK, ESQ.

JOSEPH CLARO, ESQ.

Attorney for Respondent

ORDER

NEW YORK CITY LOFT BOARD In the Matter of the Application of

400 SOUTH SECOND STREET TENANTS

ORDER

Loft Board Order No. 4860

Docket No. TR-1269

RE: 394- 400 South Second Street Brooklyn, New York

IMD No. None

The New York City Loft Board ("Loft Board") accepts in part and rejects in part the Report and Recommendation of Administrative Law Judge Susan J. Pogoda dated September 7, 2018 ("Report").

BACKGROUND

On July 6, 2015, the following tenants occupying units in the building located at 394-400 South Second Street, Brooklyn, New York ("Building") filed a joint application seeking Article 7 -C coverage for their respective units pursuant to § 281 (5) of the Multiple Dwelling Law ("MOL") and protected occupant status:

Applicant Name(s) Unit Natalie South 1 204 Andy Small and Jared Cohen 205 Katalin Junek 303 Marc Peckham 304 Anderson Miller" 401 Scott Matthew 403

On July 10, 2015, the above named applicants filed an amended application to add the following applicants (collectively with the above named applicants "Tenants") seeking Article 7-C coverage for their respective units pursuant to MDL § 281(5) and protected occupant status:

Applicant Name(s} Unit Mentor and Julie Noci 302 Koppel Verma 405 Ayca Koseogullari 406

In addition, the amended application claimed that the Building is a horizontal multiple dwelling ("HMD") made up of 394, 396 and 400 South Second Street.

On August 14, 2015, 400 South 2nd Street Holdings, L.P. ("Owner"), the owner of the Building filed an answer.

The Loft Board transferred the applications to the Office of Administrative Trials and Hearings, which assigned the matter to Administrative Law Judge ("ALJ") Susan J. Pogoda for adjudication.

1 The application listed Natalie South's name as Natalie Smith. This was corrected in the amended application. 2 Anderson Miller withdrew his coverage claims and vacated the Building. See, Transcript ("Tr.") at 1118. Tenants' counsel confirmed.

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On July 20,2016, Tenants filed a second amended application3 to add the following applicants (collectively with Tenants "Tenants") seeking Article 7-C coverage for their respective units pursuant to MOL § 281 (5) and protected occupant status:

Applicant Name(s) Unit Kirsten Russell 301 Adam Baer 402

In Owner's amended answer dated August 11, 2016, Owner opposed the amended applications.

On September 22,2016, Tenants and Owner stipulated to the following ("Stipulation"):

1. The Building constitutes a HMD in that 394-400 South 2nd Streetis one building; 2. The Building is not located in an industrial business zone; 3. The Building lacks a certificate of occupancy; 4. The Building has a history of commercial use; 5. The units as described in Tenant's original, amended and second amended applications are

not located in a basement or cellar and have at least one entrance that does not require passage through another residential unit to obtain access to the unit;

6. The above mentioned units have at least one window opening onto a street or a lawful yard or court;

7. The above mentioned units are at least 400 square feet in area; and 8. There are no incompatible uses in the Building.

In the Report, Judge Pogoda made several recommendations. First, Judge Pogoda recommended that the Building is an interim multiple dwelling ("IMO") pursuant to MDL § 281 (5) and that units 204, 205, 301, 302, 304, 402, 403 and 406 are IMO units. Second, Judge Pogoda recommended denial of Article 7-C coverage for units 303 and 405 because Tenants could not demonstrate that these two units were residentially occupied for twelve consecutive months during the period commencing January first, two thousand eight, and ending December thirty-first, two thousand nine ("Window Period"). Lastly, Judge Pogoda recommended protected occupant status to all of the occupants of units 204, 205, 301, 302, 304, 402, 403 and 406.

Based on the extensive testimonial and documentary evidence in the record, we accept Judge Pogoda's recommendation that units 204, 205, 301, 302, 304, 402, 403 and 406 are IMO units and accepts the finding thatunits 303 and 405 are not IMD units because Tenants were unable to demonstrate that these two units were residentially occupied for at least twelve consecutive months during the Window Period. The Loft Board also accepts that Natalie South, Andy Small, Jared Cohen, Kirsten Russell, Mentor and Julie Noci, John Marc Peckham, Adam Baer, Scott Matthew and Ayca Koseogullari are the protected occupants of their respective units

However, the Loft Board rejects Judge Pogoda's statement that the most logical time frame by which a tenant has to prove primary residence is the date the application for protected occupancy was filed. Pursuant to Title 29 of the Rules of the City of New York ("29 RCNY") § 1-06(m) the Loft Board must base its determination on the entire administrative record, including all pre-trial motions, testimony, documentary evidence presented at a hearing, post-trial briefs and any other evidence accepted by the ALJ or hearing examiner.

ANALYSIS

To qualify as an IMD pursuant to MDL § 281(5), the building must: have been occupied for manufacturing, commercial, or warehouse purposes; lack a residential certificate of occupancy; not be owned by a municipality; and have been occupied for residential purposes as the residence or home of

3 Tenants' counsel also mentioned that units 202,207,306, 307,407 and 504 in the Building are seeking protected occupancy under the Rent Stabilization Laws.

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any three or more families living independently from one another for a period of twelve consecutive months during the Window Period.

Coverage under MDL § 281 (5) also requires that a unit: not be located in a basement or cellar; have at least one entrance that does not require passage through another residential unit to obtain access to the unit; have at least one window opening onto a street or a lawful yard or court; be at least four hundred (400) square feet in area; not be located in an industrial business zone; and not contain an inherently incompatible use.

As noted above, the parties stipulated to most of the eligibility requirements of MDL § 281(5). The only issues before the Loft Board are: 1. whether the Building was occupied for residential purposes by three or more families living independently from one another for a period of twelve consecutive months during the Window Period; and 2. whether Tenants are the protected occupants of their respective units.

I. The Building Is an Interim Multiple Dwelling Pursuantto MOL § 281 (5).

Judge Pogoda found that the credible and unrebutted testimony and documentary evidence submitted demonstrates that units 204, 205, 301, 302, 304, 402, 403 and 406 were all residentially occupied for at least twelve consecutive months during the Window Period. Therefore, these units qualify as IMD units. We agree.

The Loft Board also agrees with Judge Pogoda's recommendation to deny Article 7-C coverage to units 303 and 405 because Tenants failed to demonstrate that these units were residentially occupied for twelve consecutive months during the Window Period. The record shows that Ms. Junek moved into unit 303 in December 2009 and Mr. Verma moved into unit 405 in November 2009. Therefore, they had to demonstrate that somebody other than themselves residentially occupied their units prior to their occupancies. However, as noted by Judge Pogoda, the evidence offered by Tenants to prove Window Period occupancy was insufficient. First, Tenants failed to offer any Window Period documents. Second, although Tenants offered testimony that these two units contained residential fixtures and were at some pOint residentially occupied by other people during the Window Period, the testimony failed to establish that units 303 and 405 were reSidentially occupied for twelve consecutive months. Tenants did not provide details as to who lived in the units during the Window Period prior to their occupancy nor did Tenants prove how long the prior residential occupancies lasted. Therefore, the evidence is insufficient to demonstrate residential occupancy for twelve consecutive months.

Owner raised several defenses to coverage of the Building. First, Owner argued that not all of the Tenants received mail at the Building. Next, Owner argued that the Loft Board should not credit the testimony of certain Tenants who failed to pay taxes. Lastly, Owner argued that the Loft Board should find unit 205 abandoned.

Owner's first argument, that not all of the Tenants received mail at the Building, was credibly addressed by Tenants. Tenants and their non-interested witnesses testified that an issue with mail delivery existed at the Building. Therefore, Tenants arranged for other methods by which to receive mail. As noted by Judge Pogoda, the fact that certain tenants chose to use alternative addresses, where they clearly did not reside, at which to receive mail, is not an indication that the Tenants did not live at the Building. The Loft Board has found that the absence of documentary proof is not fatal to coverage, especially where the testimony regarding residential occupancy was sufficiently persuasive. See, Matter of Cohen, Loft Board Order No. 4261 (Mar. 20, 2014) (Loft Board accepted the ALJ's recommendation to grant Article 7-C coverage to tenant based on the credible testimony of tenant and his non-interested witnesses) ; See also, Matter of Wagner, et al., Loft Board Order No. 256 (Jun. 26, 1985) (Loft Board found testimony of a tenant sufficient to find that tenant's unit was residentially occupied during the window period based on tenant's credibility and an absence of any rebuttal evidence).

Owner next argues that the testimony of certain tenants who admittedly did not pay their taxes should not be credited . However, the fact that someone did not pay taxes does not mean they lied at trial about when they moved into their units or what improvements they made to their unit, particularly when

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their statements are corroborated by other tenants and the Tenants' non-interested witnesses. See, Matter of Romano, Loft Board Order No. 4459 (Jan. 21, 2016) (Loft Board accepted the ALJ's finding that Mr. Romano residentially occupied his unit during the window period even though he did not always file his tax returns or pay his debts).

Finally, Owner argues that unit 205 should be found abandoned based on the absence of sufficient indicia of living and the fact that Mr. Cohen works in California. See, Owner's Post Trial Brief, at 13. However, the only evidence offered in support of this claim is the testimony of Michael Katz, the Buildings' manager, who testified that he never saw either Mr. Small or Mr. Cohen at the Building. See, Tr. at 1235-1238.

The Loft Board disagrees with Owner's argument. Abandonment is the voluntary relinquishment of possession of a unit and all rights relating to a unit with the intention of never resuming possession of the unit or reclaiming the rights surrendered. See, 29 RCNY § 2-10(f)(2). Therefore, the Loft Board will not deem unit 205 abandoned without proof that Mr. Small and Mr. Cohen voluntarily relinquished possession of unit 205 with the intent of never resuming possession. See, Matter of EPDI Associates, Loft Board Order No. 3189 (May 17, 2007) (Loft Board denied owner's abandonment application because owner was unable to demonstrate that tenants voluntarily relinquished their rights to their unit); See also, Matter of Kent Avenue Holdings, LLC, Loft Board Order No. 4442 (Nov. 19, 2015) (Loft Board denied owner's abandonment application because owner was unable to demonstrate that tenants voluntarily relinquished possession of their unit with the intention of never resuming possession).

Here, the record demonstrates that unit 205 was converted into a residential apartment with a kitchen and bathroom. See, Tr. at 1159-1161. In addition, Mr. Small testified that he has had no other residence since moving into unit 205 in August 2003. See, Tr. at 795. Further, although Mr. Cohen has worked in California since June 2015, Mr. Cohen left several of his computers, tools, books, records, CD's, clothes and his bed in the unit. See, Tr. at 878,881. Mr. Cohen also testified that when his current work assignment ends, he plans to move back to unit 205. See, Tr. at 880. Finally, Mr. Cohen pays the rent for unit 205. See, Tr. at 801, 938-939. These are clearly not the actions of a person who has voluntarily relinquished possession with the intent of never resuming possession. The Loft Board has also found that a tenant's out-of-state work assignment is not a bar to coverage. See, Matter of Pels, Loft Board Order No. 4161 (Jun. 20, 2013). See also, Matter of Various Tenants of 357 Bowery, Loft Board Order No. 4350 (Jan. 15, 2015); Matter of Ukai, Loft Board Order No. 4686 (Sept. 21, 2017).

II. Protected Occupants.

Judge Pogoda recommended protected occupant status to all of the occupants of units 204, 205, 301 , 302, 304, 402, 403 and 406. We agree. However, the Loft Board rejects Judge Pogoda's statement that the most logical time frame by which a tenant has to prove primary residence is the date the application for protected occupancy is filed. See, Report at 26. Pursuant to 29 RCNY § 1-06(m), the Loft Board must base its determination on the entire administrative record, including testimonial and documentary evidence presented at a hearing. See, Matter of Hughes, Loft Board Order No. 4820 (Nov. 15, 2018) (Loft Board rejected the protected occupancy claim of a tenant who occupied the unit as his primary residence at the time he filed his application but testified at trial that he moved out of the unit after the application was filed and continued to reside elsewhere).

The Loft Board's rule governing protected occupant determinations is found in 29 RCNY § 2-09(b). Specifically, 29 RCNY § 2-09(b)(1) provides that except as otherwise provided in the rule, the occupant in possession of a covered IMD unit is the protected occupant of the unit. Thus, in determining who is a protected occupant, the Loft Board must first consider the rule as a whole, including the provisions in (b)(2), (b)(3) and (b)(4) before it can make a determination under (b)(1).

Where there is a prime lessee or a sublessor seeking protected occupant status, any analysis of the rule must include consideration of the provisions in 29 RCNY § 2-09(b)(4). According to 29 RCNY § 2-09(b)(4), the prime lessee or sublessor who is not a prime lessee is the residential occupant entitled to Article 7-C protection, if the residential unit is his or her primary residence, even if another is in

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possession. Where there is no prime lessee or sublessor seeking protected occupant status, and the occupant seeking protected occupant status was in possession of the unit before the effective date of the applicable law and remains in possession, subsections (b)(1) and (b)(2) of § 2-09 apply to determine protected occupant status.

Judge Pogoda found that Ms. South, Mr. Small, Mr. Cohen, Mr. Peckham, Mr. Baer, Mr. Matthew, and Ms. Koseogullari are the protected occupants of their respective units because they are all subtenants who moved into their respective units prior to June, 21, 2010., the effective date of the law and they are currently in possession of their units. We agree.

Jeanine Gerding, a non-interested witness who has never lived in the Building and is not seeking coverage pursuant to Article 7 -C, testified that she leased the entire fourth floor from Mr. Dahan, the prior owner of the Building from 1999 up to and including May of 2015. See, Tr. at 364. Chuck Thomas, another non-interested witness who is also not seeking coverage pursuant to Article 7 -C, testified that David Dubois leased the entire second floor from Mr. Dahan. Michael Katz, the Buildings' manager, testified that Mr. Dahan was the prior owner of the Building. See, Tr. at 1232-1233. Therefore, Ms. Gerding is the prime lessee of the fourth floor and Mr. Dubois is the prime lessee of the second floor.

Unit 204

Ms. South testified that she has lived in unit 204 since July 2004. See, Tr. at 742,751 . As Ms. South is the residential occupant currentiy in possession and moved into the unit prior to the effective date of the law, Ms. South is the protected occupant of unit 204 pursuant to 29 RCNY § 2-09(b)(1) and (2).

Unit 205

Mr. Small testified that he has lived in unit 205 since August 2003 pursuant to a lease with Mr. Thomas and Mr. Dubois. See, Tr. at 795; Exhibit 151 : 2003 Lease. Mr. Small credibly testified that up to the present time, he has had no other residence apart from unit 205. See, Tr. at 806. As Mr. Small is a residential occupant currently in possession and moved into the unit prior to the effective date of the law, Mr. Small is a protected occupant of unit 205 pursuant to 29 RCNY § 2-09(b)(1) and (2).

Mr. Cohen is also entitled to a finding of protected occupancy. Mr. Cohen testified that he has also lived in unit 205 since August 2003 pursuant to the lease with Mr. Thomas and Mr. Dubois and is only absent from the unit due to his work in Los Angeles. See, Tr. at 874-876; Exhibit 151: 2003 Lease. Mr. Cohen has not subleased his room to other tenants, he has kept a majority of his personal belongings in the unit, he continues to pay the rent and he intends to return to the unit when his job concludes. See, Tr. at 801, 878, 880-881 and 938-939. Therefore, Mr. Cohen is a protected occupant pursuant to 29 RCNY § 2-09(b)(1) and (2). See, Matter of Mignola, Et AI., Loft Board Order No. 4509 (Apr. 21,2016) (Loft Board granted protected occupant status to Ms. Biegen pursuant to 29 RCNY § 2-09(b)(1) and (2) because there was no prime lessee seekihg protected occupant status and her occupancy began prior to the effective date of the law).

Units 301 and 302

Judge Pogoda recommended protected occupant status to Ms. Russell and Mr. and Mrs. Noci because, as the prime lessees of their respective units, the record demonstrated that they used their units as their primary residences. We agree.

Ms. Russell testified that she has lived in unit 301 since October 2003 pursuant to a lease directly with Mr. Dahan. See, Tr. at 138. Since moving into the Building in 2003, Ms. Russell has had no other residences. See, Tr. at 140. In addition to her testimony, Ms. Russell submitted extensive documentary evidence that listed her address as unit 301 at the Building. As Ms. Russell is the prime lessee of unit 301 and the record demonstrates that unit 301 is her primary residence, Ms. Russell is the protected occupant of unit 301 pursuant to 29 RCNY § 2-09(b)(4).

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Mr. Noci testified that he has lived in unit 302 since 2004. See, Tr. at 1044. Mr. Noci's wife, Julie Nod, has been living with him in unit 302 since the summer of 2008. See, Tr. at 1045, 1121 . Mr. and Mrs. Noci signed a lease with Mr. Dahan for unit 302 on November 7, 2011. See, Tr. at 1067; Exhibit 182: 2011 Lease. Mr. Noci further testified that from 2004 until the present time, he has had no other residence. See, Tr. at 1048. Mrs. Noci testified that since moving into unit 302, she has had no other residence. See, Tr. at 1127. In addition to their testimonies, Mr. and Mrs. Noci submitted extensive documentary evidence that listed their address as unit 302. As Mr. and Mrs. Noci are the prime lessees of unit 302 and the record demonstrates that unit 302 is their primary residence, Mr. and Mrs. Noci are the protected occupants of unit 302 pursuant to 29 RCNY § 2-09(b)(4).

Unit 304

Mr. Peckham testified that he has lived in unit 304 since December 1, 2009 pursuant to a lease with Adam Baer, the prime lessee of unit 304. See, Tr. at 661-662; Exhibit 109: Lease with Baer. Adam Saer testified that he leased unit 304 directly from Mr. Dahan shortly after the vacate order on the Building was lifted in the fall of 2009. See, Tr. at 254; Exhibit 150: Department of Buildings' Vacate Correspondence. As Mr. Baer is not seeking protected occupant status of unit 304 and Mr. Peckham is the residential occupant currently in possession and moved into the unit prior to the effective date of the law, Mr. Peckham is the protected occupant of unit 304 pursuant to 29 RCNY § 2-09(b)(1) and (2).

Unit 402

Mr. Baer testified that he has lived in unit 402 since November 2005 and has never had any other residence. See, Tr. at 249. Mr. Baer testified that he leased unit 402 from Ms. Gerding, Mr. Dubois and Mr. Thomas. See, Tr. at 250. As Mr. Baer is the residential occupant currently in possession and moved into the unit prior to the effective date of the law, Mr. Baer is the protected occupant of unit 402 pursuant to 29 RCNY § 2-09(b)( 1) and (2).

Unit 403

Mr. Matthew testified that he has lived in unit 403 since July 2004 and has never had any other residence. See, Tr. at 550, 552, 554. He took over the unit under an agreement with Ms. Gerding and Mr. Dubois. See, Tr. at 551 . As Mr. Matthew is the residential occupant currently in possession and moved into the unit prior to the effective date of the law, Mr. Matthew is the protected occupant of unit 403 pursuant to 29 RCNY § 2-09(b)(1) and (2).

Unit 406

Ms. Koseogullari testified that she has lived in unit 406 since July 2009 and has never had any other residence. See, Tr. at 332-333. Ms. Koseogullari moved into unit 406 pursuant to a lease with Ms. Gerding, Mr. Dubois and Mr. Thomas. See, Tr. at 339; Exhibit 72: July 2009 Lease. As Ms. Koseogullari is the residential occupant currently in possession and moved into the unit prior to the effective date of the law, Ms. Koseogullari is the protected occupant of unit 406 pursuant to 29 RCNY § 2-09(b)(1) and (2).

CONCLUSION

The Loft Board finds the Building to be an HMO consisting of eight (8) IMD units: 204, 205, 301, 302, 304, 402, 403 and 406. The Loft Board further finds that Natalie South, Andy Small, Jared Cohen, Kirsten Russell, Mentor and Julie Noci, John Marc Peckham, Adam Baer, Scott Matthew and Ayca Koseogullari are the protected occupants of their respective units.

The Loft Board directs Owner, within 30 days of the mailing date of this Order, to register the Building and the eight (8) units as IMD's, in accordance with 29 RCNY § 2-05. The Loft Board further

4 Mrs. Noci's maiden name is Puaux. See, Tr. at 1123.

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loft Board Order No. 4860

directs Owner to register Natalie South, Andy Small, Jared Cohen, Kirsten Russell, Mentor and Julie Noci, John Marc Peckham, Adam Baer, Scott Matthew and Ayca Koseogullari as the protected occupants of their respective units. If Owner fails to register and pay the applicable fees within 30 days of the mailing date of this Order, the loft Board directs the staff to:

• issue an IMD registration number for the Building; • list units 204, 205, 301, 302, 304, 402, 403 and 406 as IMD units; • list Natalie South, Andy Small, Jared Cohen, Kirsten Russell, Mentor and Julie Noci,

John Marc Peckham, Adam Baer, Scott Matthew and Ayca Koseogullari as the protected occupants of their respective units; and

• collect applicable registration fees and late fees.

DATED: March 21,2019

Renaldo Hylton Chairperson

Board Members Concurring: Carver, Barowitz, Roche, Delaney, Torres, Roslund, Hylton

Board Members Absent: Hernandez, Schachter

DATE lOFT BOARD ORDER MAilED: MAR 2 9 20t9

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matter of 400 south 2nd street tenants

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