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FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023
NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
In the Matter of the Application of 101-01 ONE
GROUP, LLC,
Petitioner,
Index No. 153346/23
For a Judgment Pursuant to Article 78 of the Civil
Practice Law and Rules,
AFFIRMATION IN OPPOSITION
-against- TO CROSS-MOTION
AND IN REPLY
NEW YORK CITY DEPARTMENT OF HOUSING
PRESERVATION AND DEVELOPMENT and NEW
YORK CITY DEPARTMENT OF FINANCE,
Respondents.
ALEXA ENGLANDER, an attorney duly admitted to practice before the
Courts of the State of New York, hereby affirms the following to be true under the
penalties for perjury pursuant to CPLR § 2106:
1. I am the managing member of Englander PLLC, attorneys for the
Petitioner, 101-01 One Group LLC (“Petitioner”). I am fully familiar with the facts and
circumstances set forth herein.
2. This Affirmation is submitted in opposition to the Cross-Motion to
Dismiss the Petition made by Respondents, the New York City Departments of Housing
Preservation and Development and Finance (separately, “HPD” and “DOF,” and,
collectively, “Respondents”), on the grounds that the proceeding is barred by the
applicable statute of limitations.
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3. As stated in the Petition, Title 28 of the Rules of the City of New
York (“RCNY”) § 39-05 sets forth the method by which notices pertaining to the
revocation of 421-a tax benefits, including Initial Notices and Determination Notices,
must be sent, as follows:
HPD shall deliver all Initial Notices, Pre-Hearing Notices,
Hearing Notices, and Determination Notices to the Taxpayer
by mail to (i) the address to which DOF delivers real property
tax bills for the Noticed Property, (ii) the last address
indicated in documents recorded in the office of the City
Register for any Taxpayer holding fee title to the Noticed
Property, (iii) the last address indicated in documents
recorded in the office of the City Register for any Taxpayer
holding a mortgage on the Noticed Property, (iv) the address
of any owner registered for the Noticed Property in
accordance with Article two of subchapter four of Chapter
two of Title twenty-seven of the Administrative Code, and (v)
the address of any agent registered for the Noticed Property
in accordance with Article two of subchapter four of Chapter
two of Title twenty-seven of the Administrative Code. Any
such notice shall be deemed to have been given upon the
third day after such notice has been deposited in the United
States mail. (Emphasis supplied.)
4. The RCNY clearly requires that HPD mail at least five notices
pertaining to the revocation of 421-a tax benefits to five addresses. Here, however, by
HPD’s own admission, it only purports to have mailed three Notices of Impending
Revocation (“Initial Notices”) dated April 14, 2022 and three Determination Notices
dated July 27, 2022 (collectively, the “Notices”), in violation of the RCNY.
5. Notably, HPD submitted copies of affidavits of service of Notices in
other Article 78 proceedings commenced by owners because their 421-a tax benefits
were revoked without notice. In at least four of those proceedings, the affidavits of
service submitted to the Court reflect that HPD mailed the Determination Notices
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pertaining to those other buildings to at least five addresses. Also, the affidavits of
service reflect that in those cases, unlike here, HPD mailed multiple Determination
Notices to either the same individual or entity at the same address, or to multiple
individuals or entities at the same address, same address with variations, or different
addresses.
6. The affidavits of service submitted by HPD in those other
proceedings support that HPD’s mailing of only three Initial Notices and three
Determination Notices, and failure to send multiple Notices to the same address in this
instance, was a deviation from its standard policies and practices, in violation of the
requirements of the RCNY and Petitioner’s due process rights.
7. Additionally, the address HPD elected to use for mailing in
accordance with 28 RCNY § 39-05(ii) (i.e. “the last address indicated in documents
recorded in the office of the City Register for any Taxpayer holding fee title to the
Noticed Property”), was not reasonably calculated to provide actual notice to Petitioner,
as required by the procedural due process clauses of the United States and New York
State Constitutions.
8. Finally, New York Community Bank (“NYCB”), Petitioner’s lender, a
“Taxpayer,” as such term is defined under 28 RCNY § 39-01, and a recipient listed on
the Notices annexed as Exhibits E and H to Respondents’ Cross-Motion, confirmed in
writing that it has no record of receipt of the Notices that were purportedly mailed to it.
SUMMARY OF RELEVANT FACTS
9. In this proceeding, Petitioner challenges the revocation of its 421-a
tax benefits retroactive to January 1, 2017, predicated on the fact that it did not receive
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any notice of HPD’s intent to revoke the benefits, nor did it receive any notice that the
benefits had been revoked.
10. Rather, it was not until December 14, 2022, that Petitioner was first
notified, when its lender emailed Petitioner’s Managing Member, Jonathan Giahn,
asking that Petitioner wire funds to cover an “escrow deficit,” that $358,752.24 in real
estate taxes had been charged back to the Building’s property tax account and were
due by January 1, 2023.
11. Via its Petition and Mr. Giahn’s Affidavit, Petitioner explained that
the applicable addresses for mailing to Petitioner required under the RCNY are
addresses where Mr. Giahn personally checks and receives mail on a regular basis,
such that he should have received HPD’s notices if they were mailed to those
addresses.1
12. Notably, Respondents’ Cross-Motion to dismiss this proceeding
further supports and establishes that the Notices provided in this instance were not
consistent with the requirements of the RCNY, nor with HPD’s policies and practices in
other similar cases. Thus, for the reasons set forth in the Petition and herein, the
underlying Petition seeking a determination pursuant to Article 78 of the Civil Practice
Law and Rules (“CPLR”), (i) annulling HPD’s July 27, 2022 Determination to revoke the
421-a tax benefits issued to the Building, (ii) reversing the property taxes charged back
to the Building’s property tax account in the amount of $358,752.24; and (iii) granting
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We acknowledge that, contrary to the position relayed via the Petition and the Giahn Affidavit,
39-05(iii) requires service on the mortgagee, and Petitioner would not have personally received any
notices sent to its lender.
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such other and further relief which this Court may deem just and proper must be
granted.
ARGUMENT
13. HPD failed to provide Notices to Petitioner as required in
accordance with its own Rules, policies, and practices, and failed to provide the Notices
in a manner that was reasonably calculated to provide actual notice to Petitioner that its
significant property interest was in jeopardy.
14. In Mullane v. Central Hanover Tr. Co., 339 U.S. 306, 314 (1950),
the United States Supreme Court reiterated the longstanding requirements of
constitutional due process as follows:
An elementary and fundamental requirement of due process
in any proceeding which is to be accorded finality is notice
reasonably calculated, under all the circumstances, to
apprise interested parties of the pendency of the action and
afford them an opportunity to present their objections.
15. As reiterated more recently by the Appellate Division, Second
Department in 149 Glen St. Corp. v. Jefferson, 140 A.D.3d 742 (2nd Dept 2016), the
same form of notice reasonably calculated to provide actual notice and an opportunity to
be heard has been applied to administrative proceedings. The Jefferson Court further
elaborated:
In making a determination as to whether notice is
“reasonably calculated,” the unique information about an
intended recipient must be considered, “regardless of
whether a statutory scheme is reasonably calculated to
provide notice in the ordinary case.” The means used to give
a constitutionally required notice “‘must be such as one
desirous of actually informing the absentee might reasonably
adopt.’” (Internal citations omitted.)
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16. In Harner v. County of Tioga, 5 N.Y.3d 136, 140 (2005), the New
York State Court of Appeals further held as follows:
Due process is a flexible concept, requiring a case-by-case
analysis that measures the reasonableness of a
municipality's actions in seeking to provide adequate notice.
A balance must be struck between the State's interest …
and those of the property owner in receiving notice.
17. As is further explained below, Respondents’ Cross-Motion must be
denied and the relief sought in the Petition must be granted in its entirety, as it is clear
from the documentation attached to the Cross-Motion that HPD’s provision of the
Notices to Petitioner was not “reasonably calculated, under all the circumstances,” to
provide actual notice to Petitioner, as required by the due process clauses of the United
States and New York State Constitutions and reinforced by binding precedent.
18. Moreover, documentary evidence supports that HPD’s alleged
mailing of Notices pertaining to the Building was not consistent with its mailing of
Notices pertaining to the revocation of 421-a tax benefits issued to other buildings.
The Exhibits Attached to the Cross-Motion
Establish that HPD did not Comply with its
Own Notice Requirements
19. The documentation attached to Respondents’ Cross-Motion
establishes that HPD failed to mail the Notices to Petitioner as required under Title 28
RCNY § 39-05.
20. As stated in the Petition, 28 RCNY § 39-05 requires that, in
connection with its intended revocation of 421-a tax benefits, HPD must provide both an
Initial Notice and a Determination Notice to the affected property owner by mailing such
Notices to five addresses. Here, HPD concedes that it only mailed three Initial Notices
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and three Determination Notices pertaining to the revocation of the 421-a tax benefits
previously issued to the Building.
21. Specifically, Exhibits E and H to the Cross-Motion reflect that HPD
purportedly sent both the April 14, 2022 Initial Notices and July 27, 2022 Determination
Notices to the following three addresses only:
(i) 101-01 ONE GROUP, LLC
101-01 39TH AVENUE
CORONA NY 11368
(ii) NEW YORK COMMUNITY BANK
102 DUFFY AVENUE 3TD FLOOR
HICHSVILLE NY 11801
(iii) 101-01 ONE GROUP, LLC
4056 JUNCTION BLVD.
CORONA NY 11368-5837
22. There is no indication from the Notices whether the addresses
listed correspond to the Notice requirements of Title 28 RCNY § 39-05(i), (ii), (iii), (iv) or
(v).
23. The plain language of Title 28 RCNY § 39-05 requires that HPD
mail all notices pertaining to the revocation of 421-a tax benefits to five addresses, with
an “and,” not an “or,” separating the fourth and fifth addresses listed therein.
24. The RCNY does not include any exclusion or exemption from the
statutory mailing requirements when the same address is listed on one or more of the
relevant documents that HPD must review in determining where to send the required
Notices.
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25. Further, HPD submitted affidavits of service in its defense of other
Article 78 proceedings challenging the revocation of 421-a tax benefits. A review of
these affidavits demonstrates that in those other cases, the affidavits of service
memorialized HPD’s service of a minimum of five and up to seven Determination
Notices, all of which were purportedly mailed on July 27, 2022.
26. Specifically, in Young BK LLC v. HPD, Index No. 160697/22, HPD
submitted an affidavit of service indicating that it mailed a July 27, 2022 Determination
Notice to six addresses, including three Notices sent to three different individuals or
entities at the same address.
27. In Young BX 1168 LLC v. HPD, Index No. 160698/22, HPD
submitted an affidavit of service indicating that it mailed a July 27, 2022 Determination
Notice to five addresses, including three Notices sent to three different individuals or
entities at the same address.
28. In Young BX 1212 LLC v. HPD, Index No. 160699/22, HPD
submitted an affidavit of service indicating that it mailed a July 27, 2022 Determination
Notice to six addresses, including five Notices sent to the same or different individuals
or entities at the same address, or a variation of the same address.
29. Finally, in Young BX 1800 LLC v. HPD, Index No. 160700/22, HPD
submitted an affidavit of service indicating that it mailed a July 27, 2022 Determination
Notice to seven addresses, including five Notices sent to the same or different
individuals or entities at the same address, or a variation of the same address. Copies
of the above affidavits of service submitted to the Court in similar matters are annexed
hereto, collectively, as Exhibit I.
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30. Thus, HPD’s determination to mail the Notices to only three
addresses, when the RCNY requires that Notices are sent to five addresses, was
arbitrary and capricious, contrary to the clear requirements of the RCNY, not reasonably
calculated to provide actual notice to Petitioner, inconsistent with HPD’s usual policies
and practices, and resulted in a deprivation of the Petitioner’s due process rights.
31. Additionally, HPD’s failure to mail multiple Notices to the same
address, when duplicate mailing was supported by the relevant documentation, was
also arbitrary and capricious, as well as inconsistent with HPD’s purported mailing of
Notices pertaining to the revocation of 421-a tax benefits to other property owners. All
of the foregoing further supports that the Determination at issue herein must be
annulled, and the 421-a tax benefits issued to the Building must be reinstated, without
penalty.
HPD’s Notices were not “Reasonably Calculated”
to Inform Petitioner that its Substantial Property
Rights were in Jeopardy
32. Similarly, the documentation attached to Respondents’ Cross-
Motion supports that, when presented with multiple addresses to choose from on a
document, HPD did not consider “the unique information about [the] intended recipient,”
and, therefore, apparently, was not “desirous of actually informing” the Petitioner that its
property rights were in jeopardy, as required under Mullane, 339 U.S. 306, supra, and
its progeny. Further, as set forth below, (and in addition to the fact that, by HPD’s
account, it only sent three of each of the Notices to Petitioner), HPD failed to comply
with other requirements of the RCNY in purportedly mailing the Notices.
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33. HPD attached its “Address Documentation for HPD Notices” as
Exhibit F to its Cross-Motion. The “Address Documentation” includes a DOF Property
Tax Bill reflecting activity through February 19, 2022, listing Petitioner’s mailing address
as 4056 Junction Blvd, Corona, New York (“4056 Junction Blvd.”), in accordance with
28 RCNY § 39-05(i).
34. The “Address Documentation” also includes a copy of the mortgage
recorded against the Building, which lists the address for the mortgagee, NYCB, as 102
Duffy Avenue, 3td Floor, Hichsville, New York 11801, in accordance with 28 RCNY §
39-05(iii).
35. Title 28 RCNY § 39-05(iv) and (v) require, in sum and substance,
that the Notices be mailed to the addresses of “any owner” and “any agent” registered
for the Building, as reflected on the Multiple Dwelling Registration (“MDR”) for the
affected building. While Petitioner acknowledges that the “Address Documentation”
supports that HPD reviewed the most recent MDR available at that time in its
determination of where to send the Notices, HPD should have mailed the Notices to
alternative or duplicative individuals and/or entities listed on the MDR.
36. Specifically, Section 5 of the 2019 MDR attached to Respondents’
Cross-Motion as the 29th page of Exhibit F is titled “Other Than Individual Ownership”
and lists Petitioner, 101-01 One Group LLC. Under Section 5A, titled
“Corporation/Partnership/LLC/Other Name,” Petitioner was again listed as the owner of
the Building, with a business address of 101-01 39th Avenue, Corona, New York (the
“Building Address”).
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37. Under Section 5A1, Joseph Giahn (Jonathan Giahn’s father) is
listed as “Responsible Person #1,” with his title listed as “Owner,” and a business
address of the Building Address and a residential address of 40-56 Junction Blvd.
38. Similarly, Section 6 of the 2019 MDR is titled “Managing Agent
Information,” and further lists Petitioner as the managing agent of the Building.
However, Section 6 also lists the managing agent as Joseph Giahn, with a business
address as the Building Address, and a residential address of 40-56 Junction Blvd.
39. Given that HPD had already purportedly mailed the Notices to
Petitioner at the Building Address and 4056 Junction Blvd., due process and the plain
language of the RCNY required that the Notices were also sent to both Joseph Giahn,
as Owner, and Joseph Giahn, as managing agent, in addition to Petitioner. HPD did not
send any Notices to Joseph Giahn, however.
40. It is well settled that, “the clearest indicator of legislative intent is
the statutory text,” such that “the starting point in any case of interpretation must always
be the language itself, giving effect to the plain meaning thereof[.]” See Majewski v.
Broadalbin-Perth Central School District, 91 N.Y.2d 577, 583 (1998).
41. Here, 28 RCNY § 39-05(iv) and (v) specifically require mailing to
“any owner” and “any agent,” making clear that multiple mailings to owners and agents
may be required. If the agency intended only that the notice be mailed to “an owner,”
“an agent,” “the owner” or “the agent,” (indicating only one), it would have said so. This
is true even if compliance with the RCNY would result in HPD sending multiple of the
five required Notices to the same address, or if doing so would result in sending more
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than five notices, as HPD did in the other matters referenced in paragraphs 27 through
30.
42. Thus, in addition to the fact that HPD failed to mail five of each of
the Notices, as required, HPD also failed to comply with the provisions of the RCNY
requiring mailing to “any owner” and “any agent.”
43. More egregious, however, is HPD’s purported mailing of the
Notices as required under Title 28 RCNY § 39-05(ii), to “the last address indicated in
documents recorded in the office of the City Register for any Taxpayer holding fee title
to the Noticed Property.” (Emphasis supplied.)
44. It is unclear whether the single Notice addressed to 101-01 One
Group LLC at the Building Address, was meant to satisfy the requirements of 28 RCNY
§ 39-05(ii), (iv) or (v).
45. Further review of the deed, however, establishes that, with respect
to Title 28 RCNY § 30-95(ii), mailing to the Building Address was not “reasonably
calculated, under all the circumstances” to provide actual notice to Petitioner.
46. Specifically, the Recording and Endorsement Cover Page of the
deed (the “Deed’s Cover Page”) lists the “Grantee/Buyer” as Petitioner, with the Building
Address as its address. Notably, that very same address is listed as the address for
both “Grantor/Sellers” listed, Akram Ahmed and Khurshid Hossain.
47. Further, the “Return To” address listed on the Deed’s Cover Page
lists Petitioner at 95-42 41st Avenue, Corona, New York, which is a valid address for
Petitioner where it checks and receives mail regularly, as stated in the Giahn Affidavit
annexed to the Petition.
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48. Notably, the first page of the actual deed for the Building also lists
Petitioner’s address as 95-42 41st Avenue, Corona, New York, consistent with the
“Return To” address listed on the Cover Page. A complete copy of the August 9, 2007
deed for the Building, including the Cover Page, is annexed hereto as Exhibit J.
49. A page titled, “Land Records - Frequently Asked Questions,”
available on DOF’s website, provides as follows:
Who or what is the “return to entity?”
The “return to entity” is the individual or business
organization to which the City Register will return the
recorded document.
See https://www.nyc.gov/site/finance/taxes/land-records-faqs.page
50. Since the City’s own FAQs recognize the “Return To” address as
the equivalent of a mailing address for a recorded deed, HPD should have used the
“Return To” address listed on both the Deed’s Cover Page for the Building and on the
deed as the appropriate address for mailing of the required Notices.
51. Moreover, since the “Return To” address listed on the deed, 95-42
41st Avenue, Corona, New York, was a fourth address (in addition to the Building
Address 4056 Junction Blvd., and NYCB’s address), HPD should have sent an
additional notice to that address. Its failure to do so was arbitrary, capricious, contrary
to fact and law and resulted in a clear violation of the Petitioner’s due process rights.
52. HPD’s failure to mail the Notices to 95-42 41st Avenue, Corona,
New York, further establishes that the Notices purportedly provided were not
“reasonably calculated, under all the circumstances” to provide actual notice to
Petitioner, as required by the United States and New York State Constitutions.
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53. Specifically, although Petitioner does receive mail sent to the
Building Address, any objective analysis of the appropriate mailing address for
Petitioner as supported by the deed would conclude that 95-42 41st Avenue, Corona,
New York is a more appropriate mailing address for Petitioner than 101-01 39th Avenue.
This is because 95-42 41st Avenue is listed as both Petitioner’s “Return To” address on
the Deed’s Cover Page, as well as Petitioner’s address on the first page of the deed
itself. In contrast, the Building Address is listed as the Petitioner’s address, as well as
the address for the two respective sellers of the Building, on that very same Cover
Page. See Exhibit J. Certainly, the address of the real property being transferred would
not be an appropriate mailing address for both the seller and the buyer of that property.
54. For this reason too, HPD’s determination to revoke the 421-a tax
benefits issued to the Building must be annulled, and the property taxes billed to the
Building’s property tax account in the amount of $358,752.24 must be reversed.
HPD’s Methodology and Documentation of
Mailing is Flawed and Unreliable
55. Via his Affidavit, Mr. Giahn, Petitioner’s Managing Member, credibly
denied receipt of any Notices purportedly sent by HPD in connection with its revocation
of the 421-a tax benefits issued to the Building and supports that he would have
promptly responded to any such Notices.
56. Notably, NYCB also confirmed that it did not receive any of the
Notices pertaining to the revocation of the tax benefits purportedly mailed to it. Upon
receipt of Respondents’ Cross-Motion attaching copies of the Notices and affidavits of
service, Petitioner provided copies of same to Michael P. Scarola, a First Vice President
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and Mortgage Lending Officer employed by NYCB. In response to Petitioner’s inquiry,
Mr. Scarola wrote by email dated July 6, 2023:
Good afternoon - We did not receive either document.
Confirmed no receipt in our Loan Admin tax unit, Asset
Management Dept. and the mail room. All have no record of
the notices.
57. When asked for further clarification on NYCB’s policies and
procedures pertaining to receiving and processing mail, Mr. Scarola wrote by email
dated July 11, 2023, in pertinent part, as follows:
Flagstar Bank, N.A., to its knowledge, is not aware of the
receipt of an April 14, 2022 or a July 27, 2022 mailing from
the New York City Department of Housing Preservation &
Development with respect to its borrower, 101-01 One
Group.
Typically, mail that is received by Flagstar Bank and is
addressed to a specific individual or department is sorted
and delivered to the inbox of that department and/or
individual the day it is received by the mailroom. Mail that is
received and is not addressed to a specific individual or
dept. is reviewed by Flagstar mailroom employees and
delivered to the appropriate department for handling based
upon a review of the contents of the mail and determination
as to where it is most appropriately routed.
***
There is no mail that remains in the mailroom at the end of
each business day.
Copies of the of the above emails from Mr. Scarola of NYCB are annexed hereto,
collectively, as Exhibit K.2
2
Mr. Scarola’s signature block clarifies that NYCB is “a division of Flagstar Bank N.A.”
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58. Further, the Notices and affidavits of service attached to
Respondents’ Cross-Motion are inconsistent and imprecise. Specifically, the affidavits
of service, which, separately, encompass (i) all three of the Initial Notices and (ii) all
three of the Determination Notices, state, “I mailed the attached letter,” in the singular,
“to the following address,” also in the singular, although Exhibits E and H annexed to
Respondents’ Cross-Motion, include copies of each of the three Initial Notices and three
Determination Notices purportedly sent.
59. Thus, the affidavits of service are facially defective and do not
substantiate HPD’s purported mailing of the Notices, as required pursuant 28 RCNY §
39-05. Rather, the affidavits of service raise questions as to which “letter,” if any, was
sent, and to which “address,” if any. Moreover, the affidavits do not state that the
“letter” was placed in any form of packaging or bore any form of postage, as is
customary in the preparation of affidavits of service by mail.
60. All of the foregoing, in addition to the facts, argument and
documentation included in and attached to the Verified Petition, support that, to the
extent that HPD provided any Notice of either the impending revocation of the tax
benefits or of its final determination, such Notices (i) were not mailed in accordance with
the requirements of Title 28 RCNY § 39-05, which require that such Notices are sent to
five addresses, (ii) were not reasonably calculated to provide actual notice to Petitioner,
as required by the due process clauses of the United States and New York State
Constitutions, (iii) were not mailed in accordance with HPD’s usual policies and
practices, as documented by affidavits of service pertaining to similar cases, and (iv)
were not actually received by Petitioner or its lender.
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FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK In the Matter of the Application of 101-01 ONE GROUP, LLC, Petitioner, Index No. 153346/23 For a Judgment Pursuant to Article 78 of the Civil Practice Law and Rules, AFFIRMATION IN OPPOSITION -against- TO CROSS-MOTION AND IN REPLY NEW YORK CITY DEPARTMENT OF HOUSING PRESERVATION AND DEVELOPMENT and NEW YORK CITY DEPARTMENT OF FINANCE, Respondents. ALEXA ENGLANDER, an attorney duly admitted to practice before the Courts of the State of New York, hereby affirms the following to be true under the penalties for perjury pursuant to CPLR § 2106: 1. I am the managing member of Englander PLLC, attorneys for the Petitioner, 101-01 One Group LLC (“Petitioner”). I am fully familiar with the facts and circumstances set forth herein. 2. This Affirmation is submitted in opposition to the Cross-Motion to Dismiss the Petition made by Respondents, the New York City Departments of Housing Preservation and Development and Finance (separately, “HPD” and “DOF,” and, collectively, “Respondents”), on the grounds that the proceeding is barred by the applicable statute of limitations. 1 1 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 3. As stated in the Petition, Title 28 of the Rules of the City of New York (“RCNY”) § 39-05 sets forth the method by which notices pertaining to the revocation of 421-a tax benefits, including Initial Notices and Determination Notices, must be sent, as follows: HPD shall deliver all Initial Notices, Pre-Hearing Notices, Hearing Notices, and Determination Notices to the Taxpayer by mail to (i) the address to which DOF delivers real property tax bills for the Noticed Property, (ii) the last address indicated in documents recorded in the office of the City Register for any Taxpayer holding fee title to the Noticed Property, (iii) the last address indicated in documents recorded in the office of the City Register for any Taxpayer holding a mortgage on the Noticed Property, (iv) the address of any owner registered for the Noticed Property in accordance with Article two of subchapter four of Chapter two of Title twenty-seven of the Administrative Code, and (v) the address of any agent registered for the Noticed Property in accordance with Article two of subchapter four of Chapter two of Title twenty-seven of the Administrative Code. Any such notice shall be deemed to have been given upon the third day after such notice has been deposited in the United States mail. (Emphasis supplied.) 4. The RCNY clearly requires that HPD mail at least five notices pertaining to the revocation of 421-a tax benefits to five addresses. Here, however, by HPD’s own admission, it only purports to have mailed three Notices of Impending Revocation (“Initial Notices”) dated April 14, 2022 and three Determination Notices dated July 27, 2022 (collectively, the “Notices”), in violation of the RCNY. 5. Notably, HPD submitted copies of affidavits of service of Notices in other Article 78 proceedings commenced by owners because their 421-a tax benefits were revoked without notice. In at least four of those proceedings, the affidavits of service submitted to the Court reflect that HPD mailed the Determination Notices 2 2 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 pertaining to those other buildings to at least five addresses. Also, the affidavits of service reflect that in those cases, unlike here, HPD mailed multiple Determination Notices to either the same individual or entity at the same address, or to multiple individuals or entities at the same address, same address with variations, or different addresses. 6. The affidavits of service submitted by HPD in those other proceedings support that HPD’s mailing of only three Initial Notices and three Determination Notices, and failure to send multiple Notices to the same address in this instance, was a deviation from its standard policies and practices, in violation of the requirements of the RCNY and Petitioner’s due process rights. 7. Additionally, the address HPD elected to use for mailing in accordance with 28 RCNY § 39-05(ii) (i.e. “the last address indicated in documents recorded in the office of the City Register for any Taxpayer holding fee title to the Noticed Property”), was not reasonably calculated to provide actual notice to Petitioner, as required by the procedural due process clauses of the United States and New York State Constitutions. 8. Finally, New York Community Bank (“NYCB”), Petitioner’s lender, a “Taxpayer,” as such term is defined under 28 RCNY § 39-01, and a recipient listed on the Notices annexed as Exhibits E and H to Respondents’ Cross-Motion, confirmed in writing that it has no record of receipt of the Notices that were purportedly mailed to it. SUMMARY OF RELEVANT FACTS 9. In this proceeding, Petitioner challenges the revocation of its 421-a tax benefits retroactive to January 1, 2017, predicated on the fact that it did not receive 3 3 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 any notice of HPD’s intent to revoke the benefits, nor did it receive any notice that the benefits had been revoked. 10. Rather, it was not until December 14, 2022, that Petitioner was first notified, when its lender emailed Petitioner’s Managing Member, Jonathan Giahn, asking that Petitioner wire funds to cover an “escrow deficit,” that $358,752.24 in real estate taxes had been charged back to the Building’s property tax account and were due by January 1, 2023. 11. Via its Petition and Mr. Giahn’s Affidavit, Petitioner explained that the applicable addresses for mailing to Petitioner required under the RCNY are addresses where Mr. Giahn personally checks and receives mail on a regular basis, such that he should have received HPD’s notices if they were mailed to those addresses.1 12. Notably, Respondents’ Cross-Motion to dismiss this proceeding further supports and establishes that the Notices provided in this instance were not consistent with the requirements of the RCNY, nor with HPD’s policies and practices in other similar cases. Thus, for the reasons set forth in the Petition and herein, the underlying Petition seeking a determination pursuant to Article 78 of the Civil Practice Law and Rules (“CPLR”), (i) annulling HPD’s July 27, 2022 Determination to revoke the 421-a tax benefits issued to the Building, (ii) reversing the property taxes charged back to the Building’s property tax account in the amount of $358,752.24; and (iii) granting 1 We acknowledge that, contrary to the position relayed via the Petition and the Giahn Affidavit, 39-05(iii) requires service on the mortgagee, and Petitioner would not have personally received any notices sent to its lender. 4 4 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 such other and further relief which this Court may deem just and proper must be granted. ARGUMENT 13. HPD failed to provide Notices to Petitioner as required in accordance with its own Rules, policies, and practices, and failed to provide the Notices in a manner that was reasonably calculated to provide actual notice to Petitioner that its significant property interest was in jeopardy. 14. In Mullane v. Central Hanover Tr. Co., 339 U.S. 306, 314 (1950), the United States Supreme Court reiterated the longstanding requirements of constitutional due process as follows: An elementary and fundamental requirement of due process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. 15. As reiterated more recently by the Appellate Division, Second Department in 149 Glen St. Corp. v. Jefferson, 140 A.D.3d 742 (2nd Dept 2016), the same form of notice reasonably calculated to provide actual notice and an opportunity to be heard has been applied to administrative proceedings. The Jefferson Court further elaborated: In making a determination as to whether notice is “reasonably calculated,” the unique information about an intended recipient must be considered, “regardless of whether a statutory scheme is reasonably calculated to provide notice in the ordinary case.” The means used to give a constitutionally required notice “‘must be such as one desirous of actually informing the absentee might reasonably adopt.’” (Internal citations omitted.) 5 5 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 16. In Harner v. County of Tioga, 5 N.Y.3d 136, 140 (2005), the New York State Court of Appeals further held as follows: Due process is a flexible concept, requiring a case-by-case analysis that measures the reasonableness of a municipality's actions in seeking to provide adequate notice. A balance must be struck between the State's interest … and those of the property owner in receiving notice. 17. As is further explained below, Respondents’ Cross-Motion must be denied and the relief sought in the Petition must be granted in its entirety, as it is clear from the documentation attached to the Cross-Motion that HPD’s provision of the Notices to Petitioner was not “reasonably calculated, under all the circumstances,” to provide actual notice to Petitioner, as required by the due process clauses of the United States and New York State Constitutions and reinforced by binding precedent. 18. Moreover, documentary evidence supports that HPD’s alleged mailing of Notices pertaining to the Building was not consistent with its mailing of Notices pertaining to the revocation of 421-a tax benefits issued to other buildings. The Exhibits Attached to the Cross-Motion Establish that HPD did not Comply with its Own Notice Requirements 19. The documentation attached to Respondents’ Cross-Motion establishes that HPD failed to mail the Notices to Petitioner as required under Title 28 RCNY § 39-05. 20. As stated in the Petition, 28 RCNY § 39-05 requires that, in connection with its intended revocation of 421-a tax benefits, HPD must provide both an Initial Notice and a Determination Notice to the affected property owner by mailing such Notices to five addresses. Here, HPD concedes that it only mailed three Initial Notices 6 6 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 and three Determination Notices pertaining to the revocation of the 421-a tax benefits previously issued to the Building. 21. Specifically, Exhibits E and H to the Cross-Motion reflect that HPD purportedly sent both the April 14, 2022 Initial Notices and July 27, 2022 Determination Notices to the following three addresses only: (i) 101-01 ONE GROUP, LLC 101-01 39TH AVENUE CORONA NY 11368 (ii) NEW YORK COMMUNITY BANK 102 DUFFY AVENUE 3TD FLOOR HICHSVILLE NY 11801 (iii) 101-01 ONE GROUP, LLC 4056 JUNCTION BLVD. CORONA NY 11368-5837 22. There is no indication from the Notices whether the addresses listed correspond to the Notice requirements of Title 28 RCNY § 39-05(i), (ii), (iii), (iv) or (v). 23. The plain language of Title 28 RCNY § 39-05 requires that HPD mail all notices pertaining to the revocation of 421-a tax benefits to five addresses, with an “and,” not an “or,” separating the fourth and fifth addresses listed therein. 24. The RCNY does not include any exclusion or exemption from the statutory mailing requirements when the same address is listed on one or more of the relevant documents that HPD must review in determining where to send the required Notices. 7 7 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 25. Further, HPD submitted affidavits of service in its defense of other Article 78 proceedings challenging the revocation of 421-a tax benefits. A review of these affidavits demonstrates that in those other cases, the affidavits of service memorialized HPD’s service of a minimum of five and up to seven Determination Notices, all of which were purportedly mailed on July 27, 2022. 26. Specifically, in Young BK LLC v. HPD, Index No. 160697/22, HPD submitted an affidavit of service indicating that it mailed a July 27, 2022 Determination Notice to six addresses, including three Notices sent to three different individuals or entities at the same address. 27. In Young BX 1168 LLC v. HPD, Index No. 160698/22, HPD submitted an affidavit of service indicating that it mailed a July 27, 2022 Determination Notice to five addresses, including three Notices sent to three different individuals or entities at the same address. 28. In Young BX 1212 LLC v. HPD, Index No. 160699/22, HPD submitted an affidavit of service indicating that it mailed a July 27, 2022 Determination Notice to six addresses, including five Notices sent to the same or different individuals or entities at the same address, or a variation of the same address. 29. Finally, in Young BX 1800 LLC v. HPD, Index No. 160700/22, HPD submitted an affidavit of service indicating that it mailed a July 27, 2022 Determination Notice to seven addresses, including five Notices sent to the same or different individuals or entities at the same address, or a variation of the same address. Copies of the above affidavits of service submitted to the Court in similar matters are annexed hereto, collectively, as Exhibit I. 8 8 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 30. Thus, HPD’s determination to mail the Notices to only three addresses, when the RCNY requires that Notices are sent to five addresses, was arbitrary and capricious, contrary to the clear requirements of the RCNY, not reasonably calculated to provide actual notice to Petitioner, inconsistent with HPD’s usual policies and practices, and resulted in a deprivation of the Petitioner’s due process rights. 31. Additionally, HPD’s failure to mail multiple Notices to the same address, when duplicate mailing was supported by the relevant documentation, was also arbitrary and capricious, as well as inconsistent with HPD’s purported mailing of Notices pertaining to the revocation of 421-a tax benefits to other property owners. All of the foregoing further supports that the Determination at issue herein must be annulled, and the 421-a tax benefits issued to the Building must be reinstated, without penalty. HPD’s Notices were not “Reasonably Calculated” to Inform Petitioner that its Substantial Property Rights were in Jeopardy 32. Similarly, the documentation attached to Respondents’ Cross- Motion supports that, when presented with multiple addresses to choose from on a document, HPD did not consider “the unique information about [the] intended recipient,” and, therefore, apparently, was not “desirous of actually informing” the Petitioner that its property rights were in jeopardy, as required under Mullane, 339 U.S. 306, supra, and its progeny. Further, as set forth below, (and in addition to the fact that, by HPD’s account, it only sent three of each of the Notices to Petitioner), HPD failed to comply with other requirements of the RCNY in purportedly mailing the Notices. 9 9 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 33. HPD attached its “Address Documentation for HPD Notices” as Exhibit F to its Cross-Motion. The “Address Documentation” includes a DOF Property Tax Bill reflecting activity through February 19, 2022, listing Petitioner’s mailing address as 4056 Junction Blvd, Corona, New York (“4056 Junction Blvd.”), in accordance with 28 RCNY § 39-05(i). 34. The “Address Documentation” also includes a copy of the mortgage recorded against the Building, which lists the address for the mortgagee, NYCB, as 102 Duffy Avenue, 3td Floor, Hichsville, New York 11801, in accordance with 28 RCNY § 39-05(iii). 35. Title 28 RCNY § 39-05(iv) and (v) require, in sum and substance, that the Notices be mailed to the addresses of “any owner” and “any agent” registered for the Building, as reflected on the Multiple Dwelling Registration (“MDR”) for the affected building. While Petitioner acknowledges that the “Address Documentation” supports that HPD reviewed the most recent MDR available at that time in its determination of where to send the Notices, HPD should have mailed the Notices to alternative or duplicative individuals and/or entities listed on the MDR. 36. Specifically, Section 5 of the 2019 MDR attached to Respondents’ Cross-Motion as the 29th page of Exhibit F is titled “Other Than Individual Ownership” and lists Petitioner, 101-01 One Group LLC. Under Section 5A, titled “Corporation/Partnership/LLC/Other Name,” Petitioner was again listed as the owner of the Building, with a business address of 101-01 39th Avenue, Corona, New York (the “Building Address”). 10 10 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 37. Under Section 5A1, Joseph Giahn (Jonathan Giahn’s father) is listed as “Responsible Person #1,” with his title listed as “Owner,” and a business address of the Building Address and a residential address of 40-56 Junction Blvd. 38. Similarly, Section 6 of the 2019 MDR is titled “Managing Agent Information,” and further lists Petitioner as the managing agent of the Building. However, Section 6 also lists the managing agent as Joseph Giahn, with a business address as the Building Address, and a residential address of 40-56 Junction Blvd. 39. Given that HPD had already purportedly mailed the Notices to Petitioner at the Building Address and 4056 Junction Blvd., due process and the plain language of the RCNY required that the Notices were also sent to both Joseph Giahn, as Owner, and Joseph Giahn, as managing agent, in addition to Petitioner. HPD did not send any Notices to Joseph Giahn, however. 40. It is well settled that, “the clearest indicator of legislative intent is the statutory text,” such that “the starting point in any case of interpretation must always be the language itself, giving effect to the plain meaning thereof[.]” See Majewski v. Broadalbin-Perth Central School District, 91 N.Y.2d 577, 583 (1998). 41. Here, 28 RCNY § 39-05(iv) and (v) specifically require mailing to “any owner” and “any agent,” making clear that multiple mailings to owners and agents may be required. If the agency intended only that the notice be mailed to “an owner,” “an agent,” “the owner” or “the agent,” (indicating only one), it would have said so. This is true even if compliance with the RCNY would result in HPD sending multiple of the five required Notices to the same address, or if doing so would result in sending more 11 11 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 than five notices, as HPD did in the other matters referenced in paragraphs 27 through 30. 42. Thus, in addition to the fact that HPD failed to mail five of each of the Notices, as required, HPD also failed to comply with the provisions of the RCNY requiring mailing to “any owner” and “any agent.” 43. More egregious, however, is HPD’s purported mailing of the Notices as required under Title 28 RCNY § 39-05(ii), to “the last address indicated in documents recorded in the office of the City Register for any Taxpayer holding fee title to the Noticed Property.” (Emphasis supplied.) 44. It is unclear whether the single Notice addressed to 101-01 One Group LLC at the Building Address, was meant to satisfy the requirements of 28 RCNY § 39-05(ii), (iv) or (v). 45. Further review of the deed, however, establishes that, with respect to Title 28 RCNY § 30-95(ii), mailing to the Building Address was not “reasonably calculated, under all the circumstances” to provide actual notice to Petitioner. 46. Specifically, the Recording and Endorsement Cover Page of the deed (the “Deed’s Cover Page”) lists the “Grantee/Buyer” as Petitioner, with the Building Address as its address. Notably, that very same address is listed as the address for both “Grantor/Sellers” listed, Akram Ahmed and Khurshid Hossain. 47. Further, the “Return To” address listed on the Deed’s Cover Page lists Petitioner at 95-42 41st Avenue, Corona, New York, which is a valid address for Petitioner where it checks and receives mail regularly, as stated in the Giahn Affidavit annexed to the Petition. 12 12 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 48. Notably, the first page of the actual deed for the Building also lists Petitioner’s address as 95-42 41st Avenue, Corona, New York, consistent with the “Return To” address listed on the Cover Page. A complete copy of the August 9, 2007 deed for the Building, including the Cover Page, is annexed hereto as Exhibit J. 49. A page titled, “Land Records - Frequently Asked Questions,” available on DOF’s website, provides as follows: Who or what is the “return to entity?” The “return to entity” is the individual or business organization to which the City Register will return the recorded document. See https://www.nyc.gov/site/finance/taxes/land-records-faqs.page 50. Since the City’s own FAQs recognize the “Return To” address as the equivalent of a mailing address for a recorded deed, HPD should have used the “Return To” address listed on both the Deed’s Cover Page for the Building and on the deed as the appropriate address for mailing of the required Notices. 51. Moreover, since the “Return To” address listed on the deed, 95-42 41st Avenue, Corona, New York, was a fourth address (in addition to the Building Address 4056 Junction Blvd., and NYCB’s address), HPD should have sent an additional notice to that address. Its failure to do so was arbitrary, capricious, contrary to fact and law and resulted in a clear violation of the Petitioner’s due process rights. 52. HPD’s failure to mail the Notices to 95-42 41st Avenue, Corona, New York, further establishes that the Notices purportedly provided were not “reasonably calculated, under all the circumstances” to provide actual notice to Petitioner, as required by the United States and New York State Constitutions. 13 13 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 53. Specifically, although Petitioner does receive mail sent to the Building Address, any objective analysis of the appropriate mailing address for Petitioner as supported by the deed would conclude that 95-42 41st Avenue, Corona, New York is a more appropriate mailing address for Petitioner than 101-01 39th Avenue. This is because 95-42 41st Avenue is listed as both Petitioner’s “Return To” address on the Deed’s Cover Page, as well as Petitioner’s address on the first page of the deed itself. In contrast, the Building Address is listed as the Petitioner’s address, as well as the address for the two respective sellers of the Building, on that very same Cover Page. See Exhibit J. Certainly, the address of the real property being transferred would not be an appropriate mailing address for both the seller and the buyer of that property. 54. For this reason too, HPD’s determination to revoke the 421-a tax benefits issued to the Building must be annulled, and the property taxes billed to the Building’s property tax account in the amount of $358,752.24 must be reversed. HPD’s Methodology and Documentation of Mailing is Flawed and Unreliable 55. Via his Affidavit, Mr. Giahn, Petitioner’s Managing Member, credibly denied receipt of any Notices purportedly sent by HPD in connection with its revocation of the 421-a tax benefits issued to the Building and supports that he would have promptly responded to any such Notices. 56. Notably, NYCB also confirmed that it did not receive any of the Notices pertaining to the revocation of the tax benefits purportedly mailed to it. Upon receipt of Respondents’ Cross-Motion attaching copies of the Notices and affidavits of service, Petitioner provided copies of same to Michael P. Scarola, a First Vice President 14 14 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 and Mortgage Lending Officer employed by NYCB. In response to Petitioner’s inquiry, Mr. Scarola wrote by email dated July 6, 2023: Good afternoon - We did not receive either document. Confirmed no receipt in our Loan Admin tax unit, Asset Management Dept. and the mail room. All have no record of the notices. 57. When asked for further clarification on NYCB’s policies and procedures pertaining to receiving and processing mail, Mr. Scarola wrote by email dated July 11, 2023, in pertinent part, as follows: Flagstar Bank, N.A., to its knowledge, is not aware of the receipt of an April 14, 2022 or a July 27, 2022 mailing from the New York City Department of Housing Preservation & Development with respect to its borrower, 101-01 One Group. Typically, mail that is received by Flagstar Bank and is addressed to a specific individual or department is sorted and delivered to the inbox of that department and/or individual the day it is received by the mailroom. Mail that is received and is not addressed to a specific individual or dept. is reviewed by Flagstar mailroom employees and delivered to the appropriate department for handling based upon a review of the contents of the mail and determination as to where it is most appropriately routed. *** There is no mail that remains in the mailroom at the end of each business day. Copies of the of the above emails from Mr. Scarola of NYCB are annexed hereto, collectively, as Exhibit K.2 2 Mr. Scarola’s signature block clarifies that NYCB is “a division of Flagstar Bank N.A.” 15 15 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 58. Further, the Notices and affidavits of service attached to Respondents’ Cross-Motion are inconsistent and imprecise. Specifically, the affidavits of service, which, separately, encompass (i) all three of the Initial Notices and (ii) all three of the Determination Notices, state, “I mailed the attached letter,” in the singular, “to the following address,” also in the singular, although Exhibits E and H annexed to Respondents’ Cross-Motion, include copies of each of the three Initial Notices and three Determination Notices purportedly sent. 59. Thus, the affidavits of service are facially defective and do not substantiate HPD’s purported mailing of the Notices, as required pursuant 28 RCNY § 39-05. Rather, the affidavits of service raise questions as to which “letter,” if any, was sent, and to which “address,” if any. Moreover, the affidavits do not state that the “letter” was placed in any form of packaging or bore any form of postage, as is customary in the preparation of affidavits of service by mail. 60. All of the foregoing, in addition to the facts, argument and documentation included in and attached to the Verified Petition, support that, to the extent that HPD provided any Notice of either the impending revocation of the tax benefits or of its final determination, such Notices (i) were not mailed in accordance with the requirements of Title 28 RCNY § 39-05, which require that such Notices are sent to five addresses, (ii) were not reasonably calculated to provide actual notice to Petitioner, as required by the due process clauses of the United States and New York State Constitutions, (iii) were not mailed in accordance with HPD’s usual policies and practices, as documented by affidavits of service pertaining to similar cases, and (iv) were not actually received by Petitioner or its lender. 16 16 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 17 of 18 FILED: NEW YORK COUNTY CLERK 07/14/2023 10:10 AM INDEX NO. 153346/2023 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/14/2023 18 of 18