GRAND IMPERIAL LLC, IMPERIAL V LLC, IMPERIAL Part 2 COURT MANAGEMENT, MICHAEL EDELSTEIN, (Hon. Kathryn Freed, J.S.C.) Defendants. : ss.

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1 FILED: NEW YORK COUNTY CLERK 07/18/ :35 PM INDEX NO /2016 NYSCEF DOC. NO. 72 RECEIVED NYSCEF: 07/18/ " SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: CIVIL BRANCH x RICHARD AMELIUS, SINJA CHO, ILONA, FARKAS, OLGA PAPKOVITCH, JESSE ZHU, -against- Plaintiffs, AFFIDAVIT OF DOB INSPECTOR VLADIMIR PUGACH Index No /2016 GRAND IMPERIAL LLC, IMPERIAL V LLC, IMPERIAL Part 2 COURT MANAGEMENT, MICHAEL EDELSTEIN, (Hon. Kathryn Freed, J.S.C.) Defendants x STATE OF NEW YORK ) COUNTY OF NEW YORK ) : ss.: VLADIMIR PUGACH, being duly sworn, deposes and says: 1. I am presently employed as a Building Inspector for the New York City Department of Buildings (hereinafter the "DOB"), and I have been so employed for the past ten years. Since July of 2009, I have been assigned to the Mayor's Office of Special Enforcement ("OSE"), where I serve as a member of the OSE' Inspection Task Force. 2. OSE is composed of inspectors from various New York City agencies, including the DOB, the New York City Fire Department ["FDNY"], and the New York City Department of Finance ["DOF"], as well as officers from the New York City Police Department ["NYPD"]. OSE's function is to perform "quality of life" inspections, covering compliance with health, safety and fire codes, in structures located within the five boroughs of New York City. 3. I submit this affidavit in support of the application by Intervenor-Plaintiff, the CITY OF NEW YORK ["CITY''] to intervene as intervenor-plaintiff as well as its applications for a temporary restraining order (TRO) and a preliminary injunction, due to the 1 of 13

2 existence of various public nuisances occurring at The Land and Building Known as 307 West 79th St., Block 1244, Lot 8, County, City and State of New York (hereinafter "the Subject Premises" or "the Building"). 4. Specifically, as explained in greater detail below, OSE inspections have indicated that residential units within the Subject Premises have been converted to provide illegal short-term occupancies (less than thirty days), despite the fact that the only legal use of the units within the Subject Premises is permanent residences. As a result of OSE's inspections at the Subject Premises, I have issued twenty-six Notices of Violation (NOVs) returnable to the Environmental Control Board (ECB) as a result of safety and code violations observed at the Building. Sixteen of these twenty-six NOVs have been directly related to the owner's operation of the Building as an illegal hotel, as fully detailed below. 5. Since 2011, I have performed the following four inspections at the Subject Premises as part of the OSE Inspection Task Force: January 13, 2011; January 31, 2012; March 28, 2016; and May 10, This affidavit is based upon my training and personal experience as a DOB Building Inspector, my review of relevant records maintained by DOB and other NYC agencies regarding the Building, and the observations I made while conducting these four inspections. 6. As part of our duties, DOB Building Inspectors are required to determine whether the actual uses and occupancies of a building or part thereof are in compliance with the legal uses and occupancies permitted by the building's applicable certificate of occupancy and other relevant DOB records, as well as all provisions of the New York City Administrative Code ("Admin. Code"), New York City Building Code ("Building Code"), New York City Zoning Resolution ("Zoning Resolution"), and other laws and regulations enforceable by DOB. 2 2 of 13

3 7. Additionally, DOB Building Inspectors have the duty to determine whether work has been conducted within a building or any part thereof without' first obtaining required DOB work permits. According to Admin. Code , it shall be unlawful to alter or change the use or occupancy of any building, or to erect or use any sign, or to cause any such work to be done, unless and until a written permit therefore shall have been issued by the DOB Commissioner in accordance with the Building Code. 8. Under Admin. Code , no change shall be made to a building or portion thereof, which is inconsistent with the last issued certificate of occupancy, or which would bring it under some special provision of that code or other applicable laws or rules, unless and until the DOB Commissioner has issued a new certificate of occupancy. 9. Pursuant to the Building Code, any person who violates or fails to comply with these provisions, or with any other provisions of the Building Code, the Zoning Resolution, or other laws or rules enforced by DOB, shall be liable for a civil penalty that may be recovered in a proceeding before the New York City Environmental Control Board ["ECB"]. Under Admin. Code , an ECB Notice of Violation and Hearing [''NOV''] may be issued by DOB Inspectors. Pursuant to Admin. Code , each NOV contains an order of the DOB Commissioner directing the respondent to correct the condition constituting the violation, and to file a certification with the DOB that the condition has been corrected. 10. Because of the higher safety standards for buildings with transient occupancy, when an inspection reveals illegal short-term use, it triggers others codes' heightened requirements for building safety systems, such as automatic sprinklers, fire alarms, and means of 1 Fonnerlynumbered under the 1968 NYC Building Code. 2 Fonnerly numbered under the 1968 NYC Building Code. 3 3 of 13

4 "? egress. Therefore, in many instances where I found illegal conversion to transient use at the Subject Premises, I also issued NOVs for failure to provide the required automatic sprinklers, fire alarm, and/or means of egress. 11. Furthermore, pursuant to Admin. Code , the failure to comply with an order of the Commissioner issued pursuant to to correct and certify correction of a violation within the applicable time period, is a violation of the Building Code for which penalties may be imposed, in addition to the penalties that may have been imposed for the violation referred to in such order. THE LAWFUL USE AND OCCUPANCY OF THE BUILDING 12. As explained above, this action involves the public nuisances being operated, permitted, and maintained within the Building at 307 W 79 1 h ST., New York, NY. 13. Prior to conducting the inspections, I and the other OSE Inspection Task Force members reviewed a copy of the applicable DOB records for the Building. The applicable DOB records for the Building include the Certificate of Occupancy ["C/0"] No , issued on November 7, According to C/0 No , the only lawful use and occupancy of the first floor of the Building is "Sixteen (16) rooms-single room occupancy, two (2) community kitchenettes, registration desk, manager's office and lobby of building." For floors two through ten of the Building, the only legal use is "Twenty-three (23) rooms-single room occupancy, two (2) community kitchenettes on each story." The only legal use of the Pent House of the Building is "Four (4) rooms-single room occupancy." According to C/0 No , the Occupancy 4 4 of 13

5 .. Classification for the Building is ''New Law Tenement Class 'A."' Single Room Occupancy. A copy ofc/0 No is annexed hereto as Exhibit According to New York Multiple Dwelling Law ["MDL"] 4{8){a), "A 'class A' multiple dwelling is a multiple dwelling that is occupied for permanent residence purposes." The law clarifies that "permanent residence purposes" means that the unit is occupied "by the same natural person or family for thirty consecutive days or more." 15. Furthermore, according to MDL 4{16) (echoed in the NYC Housing Maintenance Code ["HMC"]), Single Room Occupancy ("SRO") is "the occupancy by one or two persons of a single room, or of two or more rooms which are joined together, separated from all other rooms within an apartment in a multiple dwelling, so that the occupant or occupants thereof reside separately and independently of the other occupant or occupants of the same apartment. When a class A multiple dwelling is used wholly or in part for single room occupancy, it remains a class A multiple dwelling." 16. Finally, MDL 248 states that "A dwelling occupied pursuant to this section shall be deemed a class A dwelling and dwelling units occupied pursuant to this section shall be occupied for permanent residence purposes, as defined in paragraph a of subdivision eight of section four of this chapter." (emphasis added) 17. This means that any rental of one of the SRO units at the Building for fewer than thirty days is a violation of the MDL, as well as the HMC, in addition to implicating the attendant safety concerns such illegal transient occupancy raises. 18. Yet, despite each of its residential SRO units having the legal use of only Class "A" Multiple Dwelling-for permanent stays of thirty days or more-as fully illustrated below, the Building has been and is currently operated as an illegal hotel. 5 5 of 13

6 19. Furthermore, operation of a hotel within New York City may only be done within certain Zoning Districts. Specifically, hotels are not permitted in Residential Districts other than RIO-H, pursuant to ZR The Subject Building, as indicated in Zoning Map 5d, is zoned in RIO-A. A copy of Zoning Map 5d is annexed hereto as Exhibit Following is a summary of the facts supporting my conclusions, including the personal observations I made while conducting my administrative code enforcement inspections ofthe Building on January 13,2011, January 31, 2012, March 28,2016, and May 10, I also provide the results of my review of the relevant DOB records regarding the adjudicated resolution, if any, of the violations issued. OSE INSPECTIONS FOUND ILLEGAL TRANSIENT USE AT THE BUILDING A. January 13, 2011 Inspection & Violations Issued 22. On January 13, 2011, together with other members ofose, I conducted an Administrative Code enforcement inspection of the Building. We conducted this inspection to determine compliance with the Building Code and Zoning Resolution, as well as any other statutes or regulatory provisions enforceable by the DOB. 23. Upon arriving at the Building, we entered the lobby and found a hotel reception desk. We asked the hotel staff for a registry of their rooms. We then inspected many of the rooms in the Building, and found the majority of them to be occupied for transient use and occupancy. As a result of my inspections that day, I concluded that there was illegal occupancy being conducted in the Building contrary to that allowed by the applicable DOB records. 6 6 of 13

7 . " 24. As I continued to inspect the Building at that time, I noted that there was a failure to provide the required number of means of egress for every floor of the Building, as required by the Building Code for transient occupancy. 25. Based upon my observations, I issued the following ECB NOVs to the Building owner GRAND IMPERIAL LLC ("Grand Imperial"), explaining each violation and directing remedy to address the violation: NOV# Violation Noted Remedy Ordered Y Occupancy Contrary to C/0; Building occupied Discontinue illegal occupancy as transient hotel P Failure to provide required means of egress for Discontinue illegal occupancy every floor for transient use J Illegal use in Residential Zoning District Discontinue illegal use - See Exhibit 3 for copies of the NOVs I issued during the inspection on January 13, In accordance with standard DOB procedure, within each of those NOVs there was a DOB Commissioner's order to correct the violation. Specifically, on the face of each NOV, there is an express order to the named Respondent, Grand Imperial, that "[t]he Commissioner orders that you correct these conditions and file a certificate of such correction." 27. According to DOB records, on June 24, 2011, Grand Imperial appeared at the ECB in response to the violations I issued on January 13, After the hearing, Grand Imperial was found to be "In Violation" for NOVs No J, Y, and P. See Exhibit 4 for copies of the ECB decisions issued following the hearing on June 24, 2011, and status sheets showing that the violations have the status of "Open," ''No Compliance Recorded," meaning the underlying conditions have not been corrected to date. B. January 31, 2012 Inspection & Violations Issued 7 7 of 13

8 ', On January 31, 2012, together with other members ofose, I conducted an Administrative Code enforcement inspection of the Building. As before, we conducted this inspection to determine compliance with the Building Code and Zoning Resolution, as well as any other statutes or regulatory provisions enforceable by the DO B. 29. Upon arriving at the Building, we entered the lobby and again found the hotel reception desk. We asked for a copy of the hotel registry, and the attendant at the desk provided a copy to me. The registry showed the check-in and check-out dates of the guests staying at the Building at that time. Each of the guests listed on the registry was staying for a period of thirty days or less. We then went to some of the units within the Building, and interviewed the occupants about how long they were staying in the Building. In at least thirteen of the units, I encountered occupants who admitted that he or she had paid to stay in the Building for less than thirty days, and who showed me a payment receipt or confirmation of their reservation for a period ofless than thirty days. See Exhibit 5 for a copy of the guest registry I was provided on January 31, 2012, and for photos I took of the various receipts and documents. As a result of my inspections that day, I concluded that there was illegal transient occupancy in the Building, contrary to the C/0 No As I continued to inspect the Building, I noted that there was a continued failure to provide the required number of means of egress for every floor of the Building per the Building Code. Nor were all the hotel rooms equipped with automatic sprinklers, as required for transiently occupied units. 31. Accordingly, based upon my observations, I issued the following ECB NOVs to the Building owner, Grand Imperial, explaining each violation and directing the remedy to address the violation: 8 8 of 13

9 ..., NOV# Violation Noted Remedy Ordered L Z M Occupancy Contrary to C/0; Building occupied as Discontinue illegal occupancy transient hotel Failure to provide automatic sprinklers in rooms Discontinue illegal occupancy as required for transient use Failure to provide required means of egress for Discontinue illegal occupancy every floor for transient use See Exhibit 6 for copies of the NOVs I issued during the inspection on January 31, In accordance with standard DOB procedure, within each of those NOVs there was a DOB Commissioner's order to correct the violation. Specifically, on the face of each NOV, there is an express order to the named Respondent, Grand Imperial, that "[t]he Commissioner orders that you correct these conditions and file a certificate of such correction." 33. According to DOB records, on June 5, 2012, Grand Imperial appeared at the ECB in response to the violations I issued. After a hearing, Grand Imperial was found to be "In Violation" for NOVs No L, Z, and M. See Exhibit 7 for copies of the ECB decisions issued following the hearing on June 5, 2012, and for status sheets showing that the violations have the status of "Open," ''No Compliance Recorded," meaning the underlying conditions have not been corrected to date. C. March 28, 2016 Inspection & Violations Issued 34. On March 28, 2016, together with other members of OSE, I conducted an Administrative Code enforcement inspection of the Building. As with our previous two inspections at the Building, we conducted this inspection to determine compliance with the Building Code and Zoning Resolution, as well as any other statutes or regulatory provisions enforceable by the DOB. 35. Upon arriving at the Building, we entered the lobby and found the hotel reception desk. We again asked for a copy of the hotel registry, and the attendant at the desk 9 9 of 13

10 .... provided a copy. The registry showed the check-in and check-out dates of the guests staying at the Building at that time. All of the guests listed on the registry were staying for a period of thirty days or less. We then went to some of the units in the Building, and interviewed the occupants about how long they were staying. Throughout my inspection, I encountered multiple guests who confirmed that they had paid to stay in their units for less than thirty days. As a result of my inspections that day, I concluded that there was illegal transient occupancy in the Building, contrary to the C/0 No See Exhibit 8 for a copy of the guest registry I was provided. 36. As I continued to inspect the Building, I noted that there was a continued failure to provide the required number of means of egress for every floor of the Building per the Building Code. Nor were all the rooms in the Building equipped with automatic sprinklers or fire alarm, as required for transiently occupied units. 37. Accordingly, based upon my observations, I issued the following ECB NOVs to the Building owner, Grand Imperial, explaining each violation and directing the remedy to address the violation: NOV# Violation Noted Remedy Ordered H Perm dwelling converted for other purposes Discontinue illegal occupancy {transient use) Failure to provide automatic sprinklers in rooms Discontinue illegal occupancy as required for transient use R Failure to provide required means of egress for Discontinue illegal occupancy every floor for transient use K Failure to provide Class "J" fire alarm for Discontinue illegal occupancy transient use Z Illegal use in Residential Zoning District Discontinue illegal occupancy See Exhibit 9 for copies of the NOVs I issued during the inspection on March 28, of 13

11 In accordance with standard DOB procedure, within each of those NOVs there was a DOB Commissioner's order to correct the violation. Specifically, on the face of each NOV, there is an express order to the named Respondent, Grand Imperial, that "[t]he Commissioner orders that you timely correct these conditions and file a certificate of such correction. Uncorrected violations are subject to additional violations and penalties." 39. The ECB hearing for the violations I issued on March 28, 2016 remains pending. D. May 10, 2016 Inspection & Violations Issued 40. On May 10, 2016, together with other members of OSE, I conducted an Administrative Code enforcement inspection of the Building. We conducted this inspection to determine compliance with the Building Code and Zoning Resolution, as well as any other statutes or regulatory provisions enforceable by the DOB. 41. Once again, upon arriving at the Building, we entered the lobby and found the hotel reception desk. We asked for a copy of the hotel registry, and the attendant at the desk provided a copy to me. The registry showed the check-in and check-out dates of the guests staying at the Building at that time. According to the registry, ninety-nine units of the Building were occupied by guests staying for a period of thirty days or less. We then went throughout the Building and interviewed the occupants to find out how long they were staying at the hotel. In all, I encountered approximately sixteen units where guests confirmed that they had paid to stay at the Building for less than thirty days. As a result of my inspections that day, I concluded that there was illegal transient occupancy in the Building contrruy to that allowed by the C/0 No See Exhibit 10 for a copy of the guest registry I was provided of 13

12 As I continued to inspect the Building, I noted that despite my previous NOVs and Commissioner's Orders to correct, there was a continued failure to provide the required number of means of egress for every floor of the Building; all the hotel rooms were not equipped with automatic sprinklers and fire alarm, as required for transiently occupied units. 43. Accordingly, based upon my observations, I issued the following ECB NOVs to the Building owner, Grand Imperial, explaining each violation and directing the remedy to address the violation: I NOV# Violation Noted ~- Remedy Ordered X Perm dwelling converted for other purposes Discontinue illegal occupancy (transient use) H Failure to provide automatic sprinklers in rooms Discontinue illegal occupancy as required for transient use Failure to provide required means of egress for Discontinue illegal occupancy every floor for transient use N Failure to provide Class "J" fire alann for Discontinue illegal occupancy transient use L Illegal use in Residential Zoning District Discontinue illegal use I I I See Exhibit 11 for copies of the NOVs I issued during the inspection that day. 44. In accordance with standard DOB procedure, within each of those NOVs there was a DOB Conunissioner's order to correct the violation. Specifically, on the face of each NOV, there is an express order to the named Respondent, Grand hnperial, that "[t]he Commissioner orders that you timely correct these conditions and file a certificate of such correction. Uncorrected violations are subject to additional violations and penalties." of 13

13 The ECB hearing for the violations I issued on May 10, 2016 remains pending. BRIAN JOSEPH KRIST NOTARY public, Slate of New Yen No. 02KR Qualified In New Yortt CountY,."'7 commtsslon Expires June 15, 20~ of 13