New Jersey Supreme Court Answers Burning Question: When is a Converted Garage a "Building" Under New Jersey's Anti-Eviction Act?

New Jersey Supreme Court Answers Burning Question: When is a Converted Garage a "Building" Under New Jersey's Anti-Eviction Act?

When my wife and I lived in Hoboken, one of our favorite restaurants was Court Street. It is located on the corner of Sixth Avenue and Court Street. We went there at least once a week for most of the time we lived in Hoboken. (Great food, good atmosphere, a little off the beaten path. You should check it out.) Little did I know at the time that we were looking out from the restaurant onto a "building" that was the subject of a long-running landlord-tenant dispute that was only recently resolved by the New Jersey Supreme Court, [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance].

I used quotation marks around "building" because the issue in Cashin v. Bello was whether the word "building" as used in the Anti-Eviction Act denotes a single, unattached physical structure or whether it includes all structures owned by an individual that are located on the same parcel of land. This issue was more than just semantics to the parties involved because if the Supreme Court endorsed the former then defendant could be evicted, but if it endorsed the latter, then defendant could stay. Unfortunately for the tenant, the Supreme Court endorsed the former.

First, a little background about the Anti-Eviction Act. Under the Act, a landlord cannot evict a residential tenant absent "good cause," which is defined by statute to include, among other things, when "[t]he owner of building of three residential units or less seeks to personally occupy a unit or has contracted to sell the residential unit to a buyer who wishes to personally occupy it." This provision was not in the original version of the Act, but was added in the mid-1970's after a New Jersey court deemed the entire act to be unconstitutional because, absent a provision like this, landlords could not exercise their possessory interest over their property unless a tenant chose to leave or committed an act that satisfied the definition of "good cause" at the time. The court had determined that this would effectively turn the possessory interests of landlords and tenants upside down, seemingly giving tenants a greater right than the owner of the property.

Evictions based on this provision are somewhat unusual (most are based on non-payment of rent, which is also defined as "good cause"), but the more unusual aspect of Cashin was the property involved. Plaintiff owned a single parcel of land that contained two separate structures: (1) a six-unit apartment building that fronted Washington Street; and (2) a two-story, single-family house built in a converted garage behind the apartment building that fronted Court Street. (For those of you familiar with Hoboken, Court Street is more like an alley that runs parallel to, and in between Washington Street and Hudson Street.)

Plaintiff and her husband converted the garage into a house in the late 1960's. At the time, they obtained all of the necessary approvals and permits for the conversion and the newly-created single-family house had its own address. But, tax records do not reflect that the converted garage is a separate property from the apartment building and there is no separate deed for the converted garage.

Plaintiff and her husband lived in the converted garage until 1971, after which they began renting it out. Defendant began renting the building in 1973 and has lived there since. Her rent increased only $5 from the time she started renting the property until the present.

On several occasions, plaintiff asked defendant to vacate the property, but defendant never agreed to do so. In 2012, however, plaintiff sued, seeking to evict defendant because plaintiff intended to occupy the converted garage. The trial court dismissed the complaint, holding that the converted garage was not a separate "building" under the Act because it could not be sold separate from the apartment building. Therefore, plaintiff did not own a "building" with three residential units or fewer and thus did not have "good cause" to evict defendant so that plaintiff could occupy the converted garage. A split panel of the Appellate Division affirmed, [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance], and plaintiff appealed to the Supreme Court.

The Supreme Court overturned the trial court and the Appellate Division. Its decision was straightforward. The Supreme Court held that the Act does not define "building," but the dictionary defines it as "a structure with walls and a roof, esp. a permanent structure." Based on this definition, the Supreme Court concluded that the converted garage was a "building" -- "a freestanding physical structure that contains at most three residential units" -- and that plaintiff therefore was entitled to evict defendant. The Supreme Court held that it did not have to look to extrinsic evidence to define "building" because it concluded that the meaning of "building" was unambiguous. Nonetheless, it noted that extrinsic evidence supported its conclusion.

As a result of the Supreme Court's decision in Cashin, after more than 40 years, the converted garage/single-family home outside of Court Street will likely have a new resident. I may have to make a return visit to take a look (and to have some of Court Street's great tapenade.)

    By: Peter J. Gallagher (@pjsgallagher)

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I hope Pete's Take will be equal parts informative and entertaining. My goal with this blog is to report on cases and issues that I find relevant, or at least interesting, and hope you will too. I am a commercial litigator. In my career I have handled cases that run the gamut from complex commercial litigation to the more routine commercial matters that fill our time. Being a “generalist,” I have been exposed to various industries and areas of the law, and “Pete’s Take” will reflect this wide-ranging experience and my sometimes wider-ranging interests in the law. I hope you enjoy it and come back often.

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