FILED: NEW YORK COUNTY CLERK 09/29/ :33 PM INDEX NO /2016 NYSCEF DOC. NO. 13 RECEIVED NYSCEF: 09/29/2016

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1 FILED: NEW YORK COUNTY CLERK 09/29/ :33 PM INDEX NO /2016 NYSCEF DOC. NO. 13 RECEIVED NYSCEF: 09/29/2016 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK WILLIAM ATKINSON and JESSICA JONES, v. - Plaintiffs, Index No /2016 AMENDED COMPLAINT WEISLAW MAKSIM, TAYLOR COHEN, and MIRON PROPERTIES BROOKLYN LLC, Defendants. Plaintiffs William Atkinson and Jessica Jones (collectively Plaintiffs ), by and through their undersigned attorneys, as and for their Amended Complaint (the Complaint ) against the Defendants allege as follows: PRELIMINARY STATEMENT 1. This is an action for breach of a residential lease, fraud in inducing Plaintiffs to enter into that lease, breach of the New York warranty of habitability, and the New York Multiple Dwelling law and other claims arising from a bedbug infestation in the apartment which Defendants fraudulently induced Plaintiffs to rent. When Defendant Weislaw Maksim ( Maksim ) rented Apartment 4L at 106 Greenpoint Avenue, Brooklyn, NY (the Apartment in the Building ) to Plaintiffs on or about April 26, 2016, Defendant Maksim knew but intentionally did not disclose to Plaintiffs that the Apartment and the Building had a recent and continuing bedbug infestation. Although the prior tenants were forced to vacate the Apartment just six weeks after moving in because of a bedbug infestation, Maksim affirmatively misrepresented to Plaintiffs in a written and signed notice annexed to the signed lease that there was no history of any bedbug infestation within the past year in the building or in any 1 of 13

2 apartment. Maksim knew that he was making a false statement, but, as a sophisticated and long-time New York City landlord, he also knew that no one would rent the Apartment if he truthfully disclosed that it had been infested with bedbugs, just days, or at most weeks, prior to renting it to Plaintiffs. 2. In addition, Defendant Taylor Cohen ( Cohen ), an experienced real estate agent, employed by or contracted with Defendant Miron Properties Brooklyn LLC ( MPB ) was Defendant Maksim s rental agent, and was responsible for securing tenants for the Building, including in the Apartment. As Maksim s rental agent for some prior period of time, Defendants Cohen and MPB had to be familiar with the bedbug infestation history in the Building and knew that the Apartment had been vacated by the prior tenants after only a few weeks because of the bedbug infestation. Defendants Cohen and MPB nevertheless introduced the Apartment to Plaintiffs as a suitable and habitable residence for which said Cohen and MPB wrongly obtained compensation from Plaintiffs, as real estate agents for Defendant Maksim. 3. By reason of Defendant Maksim s fraud and breach of the warranty of habitability, and intentional conduct, and by reason of Cohen s and MPB s aiding and abetting Maksim s fraud, Plaintiffs were forced after only seven weeks in the Apartment to give notice that they would have to leave the premises, which were uninhabitable due to bedbug infestation, and Plaintiffs incurred damages in rent paid, lost brokerage fees, lost security deposit, extra moving expenses, fumigation of their property and dog, and rental at greater expense for another apartment. THE PARTIES 4. Plaintiffs are individuals, who currently reside as husband and wife, in the City, County and State of New York. 2 2 of 13

3 5. Upon information and belief, Defendant Maksim is, and at all relevant times was, the owner and landlord of the property at 106 Greenpoint Avenue, Brooklyn New York Upon information and belief, at all times relevant Maksim has maintained a business office and/or resides at 99 Freeman Street, Basement, Brooklyn, NY Upon information and belief, Defendant MPB is a limited liability company organized under the laws of the State of New York and active and subsisting in the records of the NY State Department of State, Division of Corporations. At relevant times, MPB was a real estate agency specializing, among other things, in the sale and leasing of properties in Brooklyn, New York. Upon information and belief, MPB was Defendant Maksim s agent, seeking to obtain tenants for the Building. 7. Upon information and belief, at all times relevant, Defendant Cohen was a real estate agent working for Defendant MPB in New York City. Upon information and belief, in or about May 2016, Cohen left MPB and is working with a different real estate agency in New York City. FACTS COMMON TO ALL CAUSES OF ACTION 8. In or about April 2016, Plaintiffs began searching for a suitable rental property for themselves and their dog, with a reasonable commute to Manhattan, where they both worked. At the time, Plaintiffs were living in Williamsburg paying $3, a month in rent. Their sole motivation for moving was to find a less expensive apartment. In mid to late April 2016, Cohen showed Plaintiffs the Apartment, which was listed for immediate occupancy at $ During the viewing, neither Cohen nor Maksim disclosed to Plaintiffs that the Apartment was vacant because of a recent bedbug infestation or that the adjoining apartment the condition of which Plaintiffs later learned was a Collyer s Mansion filled with trash and debris appeared to be the source of the infestation. To the contrary, during the showing, Defendant Cohen 3 3 of 13

4 represented to Plaintiffs that the Apartment was suitable for them as a habitable residence. Based on these representations, on which Plaintiffs reasonably relied, and Defendants failure to disclose the bedbug infestation, Plaintiffs agreed to rent the Apartment. 9. Plaintiffs and Maksim negotiated and agreed for Plaintiffs to lease Apartment 4L as their residence for a monthly rent of $2, for 12 months to commence May 1, Maksim also required Plaintiffs to pay a security deposit of one month s rent of $2, and a one time pet deposit of $ to lease the Apartment. 10. Plaintiffs and Defendant Maksim signed the 12 month residential lease for the Apartment on April 29, 2016 and Plaintiffs paid Defendant Maksim the initial payments of one month s rent, one month s security deposit and the pet deposit, for a total of $4, Plaintiffs also paid MPB a non-refundable broker s fee of $ as the leasing agent for the Apartment. 11. The lease consisted of a printed form and riders (collectively the Lease ), which, upon information and belief, were all drafted by either Maksim, his daughter or his attorneys. The Lease included several printed forms, including a NYS Division of Housing and Community Renewal ( DHCR ) Notice To Tenant Disclosure of Bedbug Infestation History (the Bedbug Notice ). Maksim signed the Bedbug Notice and checked off the box expressly stating that there was no history of any bedbug infestation within the past year in the building or in any apartment. A true copy of the Lease is annexed hereto as Exhibit A. 12. Cohen, on Maksim s behalf, handled the Lease signing. By reason of his extensive experience in Brooklyn and upon information and belief, knowledge of the rental history of the Building and Apartment 4L, and that the prior tenants had left or were planning to leave without finishing their lease term, Cohen knew or should have known that the Building and the Apartment had a recent history of bedbug infestation, as more fully alleged herein, and that 4 4 of 13

5 Maksim s representation on the Bedbug Notice was false. And there can be no dispute that Maksim knew about the bedbug infestation in the Apartment, since the prior tenants had vacated the Apartment for that very reason and, upon and information belief, had so informed Maksim as the reason for their vacating the Apartment. 13. Nevertheless, at no time did any of the Defendants disclose orally or in writing the fact, fully known to Defendant Maksim and, upon information and belief, also known to Defendants Cohen and MPB, that the Apartment 4L had been recently vacated by the prior tenants after only 6 weeks of residence because the Apartment and the Building had an on-going bedbug infestation, which continued immediately prior the commencement of the Lease term. By failing to make such disclosure, Defendant Maksim violated N.Y.C. Administrative Code Pursuant to the Leased signed April 29, 2016, Plaintiffs were given possession of the Apartment on or about May 1, 2016 and moved in on or about May 1, Just over a month after moving into 4L, Plaintiffs met the Apartment s previous tenants when they came to pick up a package that had mistakenly been delivered to the Apartment. Plaintiffs discovered from the previous tenants that they had been forced to vacate Apartment 4L just six weeks after moving in, because the Apartment was or became infested with bedbugs. Plaintiffs then also learned that the bedbug infestation originated in the adjoining apartment, 4R. Plaintiffs immediately complained to Defendants that no bedbug infestation had been disclosed to them and advised Defendants that Plaintiffs would not have rented the Apartment if the bedbug infestation had been disclosed. Plaintiffs asked Maksim to cancel the Lease, return May and June s rent and the security deposits, and pay the damages they had incurred, including for their moving expenses, the brokerage fee, and the fumigation costs. Maksim refused. Plaintiffs promptly commenced a search for an alternative residence. 5 5 of 13

6 16. On or about June 19, 2016, Plaintiffs also advised Defendants that they would be forced to leave on short notice, with no time to locate an appropriate replacement residence at an equivalent rent. Defendant Maksim still failed and refused to cancel the Lease and pay Plaintiffs as hereinabove alleged. 17. Shortly thereafter, Plaintiffs began to suffer the effects of the bedbug infestation in their leased Apartment. Whenever they were in the Apartment, they were bitten by bedbugs. Accordingly, Plaintiffs discovered that the Apartment was unfit and uninhabitable. Plaintiffs notified Maksim of the recurring bedbug infestation, but Maksim failed and refused to take any action to abate the condition or to treat the Apartment for bedbugs. Plaintiffs thus could not continue to reside in the Apartment and were constructively evicted. However, as Plaintiffs had feared, Plaintiffs had no other residence to move to on short notice. 18. After about two weeks of intensive searching, during the week of July 4 th, Plaintiffs finally were able to locate another apartment located in Manhattan, at greater monthly expense. Plaintiffs moved out of Defendant Maksim s infested Apartment on or about July 9, 2016, and, through counsel, tendered the keys to Maksim s attorney Steven Sperber, Esq. on July 12, Plaintiffs again demanded that Maksim return Plaintiffs security deposit and reimburse them for the damages they incurred as a result of Defendants fraud and numerous breaches. These damages include the additional expense of another brokerage fee, moving expenses, fumigation expenses and the excess rental for a new rental apartment Plaintiffs had to move to on short notice. Maksim failed to respond to Plaintiffs demand, and has failed even to return to Plaintiffs either their security deposit or pet deposit. 6 6 of 13

7 FIRST CAUSE OF ACTION (Breach of Contract and Rescission) 19. Plaintiffs repeat and reallege paragraphs 1 through 18 of this Complaint as if set forth in full herein. 20. Plaintiffs contracted with Defendant Maksim for a 12 month lease of a habitable residential premises at the Apartment. Among other things, paragraph 32 of the Lease (Exhibit A) provides: Landlord s warranty of habitability. Landlord states that the Apartment and Building are fit for human living and there is no condition dangerous to health, life or safety. 21. At all times relevant, Plaintiffs duly and properly performed their obligations under the Lease and made all required payments. Plaintiffs paid the required security deposits and the monthly rents for both May and June at $ per month. Plaintiffs also paid Cohen or MPB a non-refundable broker s fee of $ as consideration for the agreement to find Plaintiffs a suitable and habitable apartment. 22. As hereinabove alleged, the Apartment was in fact unfit and uninhabitable due to the bedbug infestation, previously well known to Defendant Maksim but undisclosed by him and, upon information and belief, known by Defendants Cohen and MPB. By reason of the foregoing, Defendant Maksim breached his obligations to Plaintiffs under the Lease and Defendants Cohen and MPB breached their agreement to find Plaintiffs a suitable and habitable apartment for the brokerage fee they paid. 23. As a direct and proximate result of Defendants breaches, Plaintiffs have been, and continue to be, substantially, materially and directly injured in an amount to be determined at trial. 7 7 of 13

8 24. Moreover, Maksim s breach of the Lease was willful and a wanton disregard of the applicable law requiring truthful pre-disclosure of bedbug infestation. Accordingly, Plaintiffs are also entitled to an award of punitive damages. 25. The Lease includes in paragraph 23(D)(3) and paragraph 19 of the Rider a provision for the Landlord s entitlement against the tenant to recover expenses (including, but not only reasonable legal fees, brokers fees, cleaning and repairing costs, decorating costs and advertising costs ) in the event of an action by the Landlord the lease is cancelled by the Landlord or he takes back possession. By reason of these provisions and in accordance with New York RPL 234, Plaintiffs are therefore also entitled in this action to an award of costs and reasonable attorneys' fees. SECOND CAUSE OF ACTION (Breach of Warranty of Habitability and NY MDL) 26. Plaintiffs reallege and incorporate by reference herein the allegations in paragraphs 1 through 25 of this Complaint as if fully set forth herein. 27. At all times relevant, there existed a warranty of habitability in the residential Lease between Plaintiffs and Maksim. 28. New York Real Property Law ( NYRPL ) Section 235-b provides, in relevant part, that [i]n every written or oral lease or rental agreement for residential premises the landlord or lessor shall be deemed to covenant and warrant that the premises so leased or rented and all areas used in connection therewith in common with other tenants or residents are fit for human habitation and for the uses reasonably intended by the parties and that the occupants of such premises shall not be subjected to any conditions which would be dangerous, hazardous or detrimental to their life, health or safety. 8 8 of 13

9 29. Under the provisions of NYRPL 235-b, Defendant Maksim was required to maintain the Apartment in a condition fit for human occupation and so that Plaintiffs, as the occupants of such premises, would not be subjected to any conditions which would be dangerous, hazardous or detrimental to their life, health or safety. Defendant Maksim failed to do so and failed prior to commencement of the Lease to remove and eliminate all bedbugs and insects from the Apartment. 30. The Building is a multiple dwelling as defined in the New York Multiple Dwelling Law ( NYMDL ). NYMDL 80(1) requires the owner of the Building to keep all and every part of a multiple dwelling... clean and free from vermin, dirt... or other thing or matter dangerous to life or health. Defendant Maksim long had notice of the bedbug infestation in the Building and in the Apartment prior to Plaintiffs moving in as residents. 31. By reason of the forgoing, Defendant Maksim breached the warranty of habitability by failing to maintain the Apartment as required by NYRPL 235-b and breached NYMDL 80(1). 32. The defects hereinabove alleged were known to Maksim long before and at the time of the execution of the Lease and were not disclosed to Plaintiffs nor cured. 33. As a direct and proximate result of Defendant Maksim s breach, Plaintiffs have been, and continue to be, substantially, materially and directly injured in an amount to be determined at trial. 34. Pursuant to the terms of the Lease and NY Real Property Law, Plaintiffs are also entitled to recover their attorneys fees and costs for Defendant Maksim s breaches of the warranty of habitability and of NY MDL of 13

10 THIRD CAUSE OF ACTION (Fraud) 35. Plaintiffs reallege and incorporate by reference the allegations of paragraphs 1 through 35 of the Complaint as though fully set forth herein. 36. Prior to the parties entering into the Lease, Defendant Maksim represented to Plaintiffs that the Apartment was habitable and specifically represented in writing in the Bedbug Notice that There is no finding of any bedbug infestation within the past year in the building or in any apartment. (See Bedbug Notice in Exhibit A hereto.) 37. Upon information and belief, Defendant Cohen and MPB by reason of their relationship with Maksim, their knowledge of the rental history of the Building and the Apartment as hereinabove alleged, also knew, but did not disclose to Plaintiffs, that the Building and Apartment suffered from recent history of bedbug infestation. Nevertheless, Defendant Cohen orally represented to Plaintiffs that the Apartment was fit and suitable as a residence. 38. Defendants aforesaid representations to Plaintiffs were false and fraudulent and known by Defendants to be false and fraudulent, in that, upon information and belief, Defendants were fully aware of bedbug infestations in the Building and in the Apartment within the year preceding the vacancy of the Apartment in or about April Defendant Maksim falsely represented to the contrary, that there was no history of such bedbug infestation. Defendant Cohen on behalf of himself, MPB and Maksim, falsely represented to Plaintiffs that the Apartment was fit and suitable as a residence, in order to induce Plaintiffs to enter into the Lease and earn his brokerage fees. Defendants Cohen and MPB substantially assisted and encouraged Maksim in the aforesaid fraudulent conduct and Cohen attended the signing of the Lease containing Maksim s false representations. Cohen thereby aided and abetted Maksim s fraud and obtained a brokerage fee of 13

11 39. Defendants knew or had reason to know that Plaintiffs would not enter into the Lease if they knew the true facts about the bedbug infestation. Defendants intended Plaintiffs to rely upon their false and fraudulent representations, which were material to the condition of the Apartment and to the Lease terms, and to deceive Plaintiffs in order to induce Plaintiffs into signing the Lease. 40. Plaintiffs reasonably relied on Defendants aforesaid false and fraudulent representations in deciding to enter into the Lease. But for those misrepresentations, Plaintiffs would not have entered into the Lease. 41. By reason of the aforesaid fraud, Defendants fraudulently induced Plaintiffs execution of the Lease, and secured the payment of monetary compensation, which ultimately caused Plaintiffs to suffer additional foreseeable damages as set forth herein. 42. Defendant Maksim then continued this fraudulent conduct by failing to correct or disclose the false and fraudulent representations while continuing to receive monies from Plaintiffs under the Lease. 43. By reason of the foregoing fraud, Plaintiffs are entitled to rescission and to have the Lease rescinded, cancelled, declared null and void. 44. By reason of the foregoing, Plaintiffs have been substantially, materially and directly injured in an amount to be determined at trial, and are entitled to recover the costs and attorneys' fees of this action. FOURTH CAUSE OF ACTION (Rescission) 45. Plaintiffs reallege and incorporate by reference the allegations of paragraphs 1 through 44 of the Complaint as though fully set forth herein of 13

12 46. In the alternative, even if the aforesaid misrepresentations of material facts as to the condition of the Apartment were innocently made without deceptive intent, those misrepresentations were a material inducement for Plaintiffs to sign the Lease and created such an impression in Plaintiffs that the Apartment was suitable and habitable, so that Plaintiffs could enter into the Lease therefor. 47. By reason of the foregoing, Plaintiffs are entitled to rescission and to have the Lease rescinded, cancelled, and declared null and void. WHEREFORE, Plaintiffs ask that the Court enter judgment as follows: A. For Plaintiffs and against each Defendant on the aforesaid causes of action; B. For Plaintiffs against Defendant Maksim declaring that the Lease is rescinded, cancelled, and null and void; C. For Plaintiffs against each Defendant for the damages proximately caused by Defendants on each of the aforesaid causes of action, in an amount to be determined at trial but alleged to be in excess of $30,000; D. For Plaintiffs against each Defendant on the aforesaid causes of action for punitive damages of at least $90,000; E. For Plaintiffs against each Defendant awarding Plaintiffs their reasonable attorneys fees and costs of this action to the extent allowed by law; and of 13

13 F. For such other and further relief as is just and proper. SCHWARTZ & THOMASHOWER LLP Dated: New York, New York September 29, 2016 By: s/rachel Schwartz Rachel Schwartz William Thomashower 15 Maiden Lane, Suite 705 New York, New York Tel.: (212) Attorneys for Plaintiffs, WILLIAM ATKINSON and JESSICA JONES of 13