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Housing Authority of the City of Newark v. Blanding

A-2978-00T5 (N.J. Super. App. Div. 2002) (Unpublished)

LEASES— Annual renewals of leases that provide for such renewals are not new leases, but constitute the same lease.

A woman lived in a public housing complex. Her rent was subsidized by the federal government. At the outset of her tenancy, she executed a lease agreement for a term of one month which was “to be automatically renewed for successive periods of equal length unless properly terminated… .” The lease also provided that the rent could be changed “by either an annual or an interim redetermination” based upon HUD guidelines. The Lease provided, “The TENANT will be notified in writing of any rent adjustment due to annual or interim re-examinations.” Periodically, the tenant’s rent was decreased, or increased. Over the years, she fell seriously into arrears and a series of eviction actions followed. Ultimately, the housing authority sought to evict the tenant for failure to pay fifteen months’ rent. The proceeding was terminated when the lower court concluded that the parties had entered into a new lease when the woman’s rent had been last increased before the eviction proceedings took place. In fact, the Court said: “I find that the common understanding is that the annual renewals are in effect a new lease, rather than a rider or addendum to an existing lease, notwithstanding any language in the original lease to the contrary.”

The Appellate Division disagreed. It found the lower court’s conclusion inconsistent with the plain language of the lease and the rider in which the tenant agreed to the most recent increase in rent. The Court focused on the lease language stating that it was “automatically renewable.” It also pointed to the elaborate procedure for redeterminations of rent and specific language in the lease stating that the tenant agreed that a redetermination of the rent by the housing authority and execution of a rider to the lease constituted a lease modification rather than an execution of a new lease. A letter setting forth the most recent rent increase expressly stated, “[y]our present lease will remain unchanged in all particulars other than the amount of rent to be paid, if a change in rent is indicated above.” The letter was consistent with the lease language. Therefore, the Court remanded the matter to the lower court for further hearing based upon the tenant’s other defenses.

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