The Standard of Review in Non-Primary Residence Appeals

The New York Court of Appeals (New York’s highest court) has issued a decision that affirms the long-standing standard of review to be employed by the Appellate Division when the Appellate Division is acting as the second appellate court to pass judgment on a non-primary residence proceeding. In the case of 409-411 Sixth Street, LLC v. Mogi, 22 N.Y.3d 875, __ N.E.2d ___, ___ N.Y.S.3d ___ (2013) the Court of Appeals reversed a decision of the Appellate Division and remanded the case with instructions on the correct standard of review to be employed by the Appellate Division when it is the second appellate court to hear a non-primary residence proceeding.

The Mogi case was a fascinating example of how difficult it can be for a judge to render a decision in a non-primary residence proceeding. Judge Jean Schneider heard testimony and reviewed documentary evidence and came to the conclusion that the tenant did not maintain the subject unit as her primary residence. Judge Schneider found that because the tenant had negligible electrical usage in the subject apartment, owned a house in Vermont where her companion lived, listed the Vermont address on her driver license and car registration, and had significant credit card and bank transactions in Vermont that the tenant did not maintain her primary residence in New York.

The Appellate Term (the first appellate court to take a whack at this case) affirmed Judge Schneider and found that while she may have placed undue emphasis on the credit card and bank statements that her decision in favor of the landlord was a fair interpretation of the evidence.

The tenant moved for leave to the Appellate Division and that motion was granted. The Appellate Division reversed 3-2 and held that the landlord had not proved by preponderant evidence that the tenant did not maintain the subject apartment as a primary residence. Justice Renwick, writing for the majority, wrote a detailed factual analysis in which she concluded that the tenant did maintain the subject apartment as her primary residence.

As the decision from the Appellate Division was 3-2, the landlord was able to appeal to the Court of Appeals. As was discussed above, the Court of Appeals reversed and remanded the case to the Appellate Division for further proceedings. In reversing, the Court of Appeals was persuaded that the wrong standard of review had been utilized by the Appellate Division and expressly held that as the second appellate court reviewing the case that the landlord was not required to show that it had proved its case by preponderant evidence. Rather, the Court of Appeals held:

    “the decision of the fact-finding court should not be disturbed upon appeal unless it is obvious that the court’s conclusions could not be reached under any fair interpretation of the evidence, especially when findings of fact rest in large measure on considerations relating to the credibility of witnesses.”

Mogi, supra.

It is rare for a non-primary residence proceeding to reach the Appellate Division but the Court of Appeals did clarify what is the role of the Appellate Division when one does get there. An interesting case indeed.