For more than 45 years, New York wine enthusiast Peter Morrell and his wife Cathy have rented an attic house in a pre-war building near the East River. The apartment boasted a view of the UN building and a terrace where the family could buy charming fireworks on July 4.
Not only that, but it was stabilized by rent.
As the years went by, many of the 81 apartments on 865 First Avenue were converted into apartments and sold north for $ 1 million. However, the Morrells remained in place. Why not?
Under state law, their landlord had no choice but to continue renewing the rent for market rents – still only $ 3,381 a month – and wait for Father Time to get to the random couple.
However, it turned out that even Time’s father did not comply with the New York rent law: the Morrells could only rent their daughter.
The current owner, Queens-based Samson Management, has no plans to wait another 45 years. In August 2019, allegations that the Morells lived in the north of the state were notified of their release and that their daughter was not entitled to stabilized rent. Rent-stabilized units can only be used as primary residence.
A legal battle ensued. So far, the Morells are winning.
Wines and spirits
Peter Morrell’s family is worshiped in the New York wine community. In 1994 she organized the first auction of good wine in the city and five years later opened the Morrell Wine Bar and Cafe in Rockefeller Center. A bar that has closed for a pandemic, offers more than 100 wines from the glass, and NBC executives and editors from Simon & Schuster have visited the site, according to a profile in Edible Manhattan.
Morrell’s parents, Samuel and Charlotte Morrell, started a family business in 1947, opening a small liquor store on East 49th Street. It was also a crucial year in the history of rent control: Buildings built before February 1947 were subject to and nationwide control of rent Statute signed by President Franklin Delano Roosevelt.
When the Korean War ended in 1953, the federal government got out of the rent control business, but New York City took over and in 1969 layered a new framework: rent stabilization. Two years later, Peter took over the family business, and a few years later he and his wife moved to the First Avenue shelter.
A major change in the Rent Act in 1993 made an apartment exempt from regulation if it was relaxed and the rent exceeded a certain amount. However, the Morrells adhered to their rent, and 26 years later, the state legislature ended the vacancy check in the 2019 reform of the Rent Act.
Problems with the law
The new statute made it almost impossible for landlords to remove units from rent stabilization – even though tenants primarily live in a country home (which Morrell allegedly did), make money, or die.
However, there are several remaining pathways to deregulation. Because Morrell’s buildings have been converted into a condominium, rent-stabilized units can be released, removed from regulation, and sold.
Samson’s case assumes that the First Avenue apartment between East 48th and East 49th is not the couple’s primary residence. According to court documents, the Morrells also have a place in the Hudson Valley.
However, the Morrells claim that they use this apartment to attend meetings of a winery in New York and that their daughter Tarajia has been staying there since 2016. Expect Morrell is a freelance writer for wine, food and travel who has bylines in WSJ Magazine and Vogue.com, according to her affidavit.
In December, Tarajia brought a state agency overseeing rent regulation, the Homes Division and Community Renewal, against the landlord. She claimed that she was entitled to inheritance rights from rent, which means that she could stay there for regulated rent, which usually increases only 1 or 2 percent annually.
In June, the state decided in its favor. The landlord appealed, but was rejected again last month.
Samson doesn’t give up. The company sued the New York Supreme Court last week, seeking to modify or revoke an order based on inconsistencies in a freelance writer. For example, she filed tax returns stating a mailbox, not an apartment, and in 2016, when her parents lived in Dutchess County, she claimed to be roommates.
Samson management declined to comment. Morrells’s lawyer, Andrew Luskin of McLaughlin & Stern, was unable to respond immediately to a request for comment.