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229-233 Phoenix Property, L.L.C. v. Rivera

A-0157-06T1 (N.J. Super. App. Div. 2008) (Unpublished)

LANDLORD-TENANT; EVICTION; RELOCATION — Even though a tenant who has removed from its premises pursuant to the New Jersey Anti-Eviction Act because the building is being repaired to cure violations and may have been granted a right of refusal by a court to reoccupy its apartment after the building is renovated, there is nothing in the Act that permits such a tenant to reoccupy the premises at the previous rental price.

A married couple, as residential tenants, appealed from judicial orders that had given their landlord the right to evict them from their rent controlled premises, and from a finding that the tenants had not exercised their right of first refusal to reoccupy their apartment upon completion of renovations at market price rent. The tenants had been forced to relocate because their building was scheduled for extensive structural renovations to correct numerous municipal and state safety code violations. The lower court had awarded them the maximum relocation expense allowance available under law. A judicial order had given them a right of first refusal to reoccupy the reconditioned apartment, but it was dependent on the couple’s payment of the that rent upon completion of the property’s renovation and the tenants’ submission to a credit review to determine their capacity to pay market rent. The lower court also confirmed that the tenants knew that they were ceding occupancy rights to the apartment. One year after the relocation, the new building owners notified the tenants that they could exercise their right of first refusal and reoccupy the apartment. The tenants contested the market rent set by the new building owners. The lower court concluded that the prior tenancy had been terminated and that the tenants had been compensated for their relocation costs. It fixed the market rent and found that the tenants failed to exercise the right of first refusal. Therefore, it terminated their right.

The Appellate Division affirmed the lower court’s ruling, finding that the tenants had been evicted in accordance with the New Jersey Anti-Eviction Act. The Act allows eviction of a residential tenant where the landlord needs to remedy code violations that affect health and safety, and where it is unfeasible to comply without removing the tenant. Here, the Court agreed with the lower court that the landlord had established good cause and that it was proper to require the tenants to relocate. It sustained the lower court’s order that the landlord pay its tenants the maximum available relocation allowance, and found that the tenants had agreed to a right of first refusal to the apartment after building renovation. The Court saw nothing in the Act that would permit a tenant to reoccupy the premises at the previous rental price. It also pointed out that the New Jersey Senior Citizens and Disabled Protected Tenancy Act did not grant the disabled wife a protected tenancy status because she was no longer living in her apartment when it had been converted to condominium ownership. This statute serves to prevent the relocation of disabled tenants because of difficulties in mobility prior to any conversion of a dwelling unit.

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