JUST IN: JUDGE DECLINES TO EVICT PRIME APARTMENTS LANDLORD, BUT PERMITS LAWSUIT TO PROCEED

Ocean County Superior Court Judge Valter Must has just formally declined to grant two filings by tenants of Prime Apartments which were seeking to evict their landlord and appoint a receiver. However, the judge did permit the litigation to proceed, denying two motions to dismiss filed by the landlord.

The landlord insists that he is in full compliance with the Township's Rent Control Board ordinances which - despite the fact that the Township Committee abolished the Board - remain valid and in effect; and those ordinances provide for retroactive approvals of hardship applications if the (non-existent) Board does not take action on the application within 60 days.

The landlord has also stated that he is committed to adjudicating any remaining claims in Bais Din. The tenants have shockingly told the judge, "we do not agree to go to Bais Din!"

As first reported here on FAA News, back in May 2023, 60 tenants of Prime Apartment tenants served their landlord and his property manager with a Superior Court lawsuit alleging a long list of illegal rent increases and associated harassment, intimidation and retaliation.

The tenants are Alexander Sternbuch, Shmuel and Rochel Bogart, Dovid Balter, Shmuel Banker, Aaron Beer, Yaakov Cohen, Moshe and Feigy Eisemann, Ezra Esses, Tzvi and Zipora Feifer, Chezky Feigenbaum, Yehoshua Finkel, Yisroel Friedman, Ashi Fuchs, Boruch Gellis, Yaakov Glustein, Yonah Goldberg, Yaakov Gordon, Esther Gorelick, Elozor Greenberger, Shmuel Grunhut, Yehuda Gugenheimer, Alter Halberstam, James Holtzberg, Yisroel Kanarek, Dovid Kaplan, Kirnos, Zev Kramer, Abraham Leibiker, Yehuda and Yehudis Marcus, Steven Meisels, Yisrael Mordowitz, Nochum Naiman, Chayala and Moshe Olshin, Dovid Paskesz, Meir Poltzer, Tzvi Puretz, Shlomo Reidel, Mordechai Reis, Menachem Rosenblum, Dov Rosenman, David Rothstein, Yaakov Schechter, Chaim Schwab, Chanoch Shapiro, Temima and Zachary Shemesh, Naftoli Simon, Yosef and Zizi Simon, Mordechai Snyder, Samuel Tepfer, Yisroel Weiss, and Moshe Wilner.

The tenants are represented by Attorney Ian Goldman Esq. of Levin Shea Pfeffer and Goldman. (Mr. Goldman also serves as the Lakewood Municipal Prosecutor and counsel to the Lakewood Township Municipal Utilities Authority and Board of Fire Commissioners.)

Defendants are Prime Apartments, which is owned by Cheskel Brach, and Rushmore Management, the property manager.

The allegations contained in the lawsuit include that the landlord entered into contracts he prepared with tenants and specifically in writing agreed not to raise rents more than 5% at renewal and be bound by Lakewood rent control; however, he is attempting, and has raised rent above the 5% Lakewood Township Rent Control Ordinance, and in one instance raised rent 50% over current rent in breach of not only the existing leases but also in violation of law.

To date, some of the tenants have collectively decided to continue to make payments to the landlord at 5% above their most recent lease that they agreed to.

Each month they receive a statement from the landlord with arrears accruing as a balance for not paying the full amount requested pursuant to the landlord's unilateral and illegal lease changes and rental increase.

Eviction proceedings and threats of eviction proceedings have started due to these partial payments which is why the Plaintiffs have initiated this action.

The lawsuit seeks for an order reinstating the rental amounts to the initial amounts, ordering that the tenants regain access to the storage units, compensatory damages, punitive damages, attorney costs and fees, and any such other damages as the law deems just and proper to make the Plaimtiffs whole again.

As previously reported here on FAA News, following the filing of this lawsuit, Cheskel Brach, the landlord of Prime Apartments, served the tenants with a Hasra'ah (a warning) from the Bais Din of the Central Rabbinical Congress of the U.S.A. and Canada (the CRC).

Additionally, as previously reported here on FAA News, Bais Din Zedek which is under the auspicies of Rav Yisroel Knopfler, has also authored a Hasra'ah against the tenants.

Ignoring all of these warnings, as previously reported here on FAA News, back in June 2023, the tenants cranked things up a whole notch higher by filing in Court for emergent relief seeking to take the building out of the hands of its landlord and have a Receiver appointed to manage the building instead!

Out of desperation after the judge did not schedule a hearing on this motion, as previously reported here on FAA News, the tenants recently renewed their efforts to seek emergency relief from the court.

As previously reported here on FAA News, back in June 2023, Marlton Attorney Lori C. Greenberg, Esq., representing Prime Apartments, filed an Answer to the Complaint together with counter-claims and separate defenses, asserting that the parties entered into lease agreement contracts, which provides how much rent is to be paid on a monthly basis, and the number of occupants that can reside at the premises, and nature of tenants occupancy, and they are in breach of their leases either because they failed to pay their rent, a rent increase, had too many occupants residing in the unit and/or occupying the unit in a manner inconsistent with the terms of the lease agreement, including by taking up storage units that are not in their lease and they are not paying for the storage.

Counter-claims include: Frivolous Claims; Unjust Enrichment; and Misrepresentation.

Subsequently, as previously reported here on FAA News, the landlord filed a Motion to Dismiss the Complaint for Failure to State A Claim.

The motion states:

Prime Apartments has approximately 104 apartments. The Plaintiffs filed the Complaint on behalf of many tenants. The Plaintiff only cites issues regarding two tenants. The Plaintiff appears to be making this into a class action case. They cannot do that. They have to certify a class.

The Plaintiffs are not all similarly situated. Each tenant has their own lease and their own circumstances; some tenants have moved out, some are not paying any increases, some are paying increases. Some tenants have storage, some do not. The Plaintiffs can not simply join so the tenants and not plead with specificity for each one. The legal matter must be pled specifically for each tenant and the results may be different for each tenant.

We are asking for the Complaint to be dismissed against all tenants not specifically named in this Complaint for failure to state a claim. The Complaint only names Rivka and Nochum Naiman and Yehuda Marcus and does not detail any other tenants allegations, leases, and rent notices. The Complaint should be dismissed against all the other tenants.

On a Motion to Dismiss for Failure to State A Claim, the Complaint must be searched in depth and with liberality to determine if a cause of action can be gleaned even from an obscure statement, particularly if further discovery is taken... A Complaint should not be dismissed where a cause of action is suggested by the facts... Printing Mart v. Sharp Electronics.

However, if the Complaint states no basis for relief and discovery would not provide one, dismissal of the Complaint is appropriate. Energy Rec. v. Dept. of Environmental Protection.

When the landlord filed an Answer to the Complaint, they also served the tenants with discovery which included a list of interrogatories and notices to propound.

The landlord has now filed a second motion to dismiss the case based on the fact that the tenants have failed to respond to these discovery demands.

The tenants did not file written Opposition to the first motion. However, they responded to the second motion by filing a Motion to Extend Discovery an additional 60 days.

"Our response to Interrogatories in this matter is now past due. As this Court is aware, there is a multitude of Plaintiff’s in this matter, approximately 50. Due to the number of Plaintiffs associated with this case, it has taken myself, along with my support staff additional time to receive all corresponding documentation from each Plaintiff. In addition, many of the Plaintiff’s in this matter are parents of young children, on summer break who have been traveling for the summer, which has caused a delay in their production of documents to my office.

"Due to the number of Plaintiff’s in this matter, and their vacations, we are kindly requesting a 60-day extension to produce of Interrogatories, and Request to Produce Document," wrote Mr. Goldman.

At oral arguments held on Friday, Judge Must declined to dismiss the case, saying that he disagreed with the landlord's assertion that this is a class action case without court approval for a class.

"A class action suit is where every single party was equally damaged and seeks equal reparations, and agrees to be equally bound by one single court ruling. However, this case isn't necessarily about equal damages and equal reparations," the judge stated.

At the same time, the judge declined to completely dismiss the litigation. Quoting the very case law that was cited in the motion brief, "On a Motion to Dismiss for Failure to State A Claim, the Complaint must be searched in depth and with liberality to determine if a cause of action can be gleaned even from an obscure statement, particularly if further discovery is taken... A Complaint should not be dismissed where a cause of action is suggested by the facts..." Printing Mart v. Sharp Electronics, Judge Must noted that while the Complaint did not exactly state each party's name, their original rent and their new rent, the, "a cause of action can be gleaned" that this lawsuit alleges an unlawful rent increase.

Additionally, while the Complaint did not exactly state these specifics, "if further discovery is taken," all that information will be learned.

As such, the judge ruled that the litigation can proceed with further discovery demands. As to the motion to dismiss for failure to make discovery and the tenants' request to extend discovery for 60 days, Judge Must granted an extension for 30 days and stated, "legally, all discovery questions need to be answered. You may not leave any questions unanswered. If the answer is 'non-applicable', you must answer so."

Judge Must added, "the fact that you have so many clients in this case is no excuse to fail to make discovery. When you accept clients you need to have the sufficient wherewithal to serve all of them."

As to both Orders To Show Cause seeking to evict the landlord and appoint a receiver to manage the building, Judge Must denied both requests, saying, "I don't see any basis for emergent relief here."

In his opposition to the second Order To Show Cause, the landlord's attorney lays out very simply the basis of his assertion why the lawsuit must be dismissed:

The landlord filed a hardship rent increase application with the Lakewood Rent Control Board on June 9, 2023 on the basis that he is bleeding money from this property and must raise rents in order to support the economic viability of the apartment complex. Per the language of the Township's Ordinance, the Rent Control Board has to rule on the increase in 60 days or it is granted automatically. As the (non-existent) Board did not rule on the application by August 9, 2023, it became granted automatically retroactive to 30 days prior.

As such, as of August 1, rents were increased to $2,483 as requested in the hardship application to the Rent Control Board.

The tenants filed their recent Order To Show Cause simply as a run around the Rent Control Board and a futile attempt to stop this increase. Continued litigation in light of the procedural history and legal arguments presented should be viewed solely as a delay tactic.

I.e. The Lakewood Township Committee's abolishment of the Rent Control Board (which was done years ago to help "one of the boyz") continues to cause havoc for landlord and tenants alike, as that Board was granted jurisdiction to accept complaints from tenants of illegal rental increases, investigate complaints, reduce rents based on landlord's breach of covenants in lease or implied covenants, such as habitability, as well as to accept applications from landlords who are seeking rental increase based on hardship, unusual expenses, tax surcharge or other circumstances, and to adjust rents based on landlord's subsequent change in position caused by law or economic conditions.

Despite that this contentious litigation has been ongoing in civil court since May, and despite that this story highlights the havoc caused by the abolishment of the Rent Control Board, Township officials have been silent this entire time, with no public statements regarding the abolishment of the Rent Control Board and whether or not it will be reinstated.

At Friday's hearing, Judge Must did not address the merits of the landlord's assertions are in full compliance with the Township's Rent Control Board ordinances, as that will be addressed at a future trial.

The landlord has filed in court for 3 evictions. The hearings on those matters have been set for October 23, 2023.

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