Victorville by the Sea's "China Club Cottage" depicted in a photo posted by @_victorville on Instagram in June 2020. The caption says "Wake up to a peaceful view from the China club cottage!"

The operator of a Aquebogue vacation rental on Overlook Drive known as “Victorville by the Sea” has signed a stipulation preventing it from advertising, booking and renting any part of the property through Airbnb or otherwise pending the outcome of a lawsuit brought by the town.

The lawsuit, filed by the town attorney’s office in October 2020 accuses the operator of having constructed and occupied improvements on the property without building permits and certificates of occupancy and of violating the town’s rental code since at least May 2018.

The property at 128 Overlook Drive is owned by Canal House, a Manhattan-based company whose managing member is Victor Ozeri, according to court documents.

According to the complaint, the property owner added without permits at least two bedrooms, at least two fill bedrooms, added a cottage including multiple bedrooms and at least one bathroom, added a pool house, a fixed airstream trailer and a fixed boat house, and converted a detached garage into habitable space. The owner had no permits or certificates of occupancy or compliance for any of those structures, according to the complaint.

A post from by @_victorville on Instagram

The town in its complaint said the defendants — the company and Ozeri — market the premises on social media platforms such as Instagram and on the vacation rental website Airbnb as “Victorville by the Sea” which “sleeps 42-46 people” and “consists of a main house with five themed bedrooms and four bathrooms, as well as 7 separate and unique cottages” that each sleeps 4-12 people,” as well as 7 separate and unique cottages.”

The complaint says the defendants operate the premises “as a hotel and/or bed-and-breakfast enterprise,” preparing and serving food and alcoholic beverages to guests.

Defendants have used the premises to host weddings and parties, including birthday, bachelor and bachelorette parties and corporate retreats, the complaint states.

Rates charged by the operator range from $289 per night to $1,068 per night, the complaint says.

The defendants are represented by Anthony Palumbo, who answered the complaint with general and specific denials and raised a number of affirmative defenses, including the town’s alleged “own culpable conduct, negligence, omissions” and more.

Palumbo is a state senator representing the senate district that includes the Town of Riverhead. When the lawsuit was filed he was a state assemblyman representing the assembly district that includes the Town of Riverhead.

Riverhead sought a temporary restraining order preventing the defendants from renting the property while the lawsuit was pending.

State Supreme Court Justice Paul Baisley Jr. denied the town’s application on Aug. 6.

The town did not get a chance to appear before the court on the TRO application, Town Attorney Erik Howard said. The town was not contacted by the court or given the opportunity to be heard, which Howard said was “unusual.”

Nevertheless, Howard said, the town was able to negotiate a informal agreement that “the rentals through Airbnb would stop.”

“Then, earlier this month, we were finally able to bring everyone together in a conference to discuss the case and how Mr. Ozeri could address the building violations at the property,” Howard said. “Those discussions were productive and we formalized the stipulation providing that the AirBnb rentals would cease absent appropriate Town permits and/or certificates of occupancy,” Howard said.

The town attorney said the Riverhead Police Department was “instrumental in assisting code enforcement and the town attorney’s office in documenting and establishing Canal House’s practice of transient rentals in violation of town code,” Howard said, “and we were able to achieve a good result and relief for residents in the area.”

Palumbo said in a text message Wednesday Ozeri is “working with the town to make sure his home is fully compliant with all local laws and certificates of occupancy are obtained wherever necessary.

“We are hopeful that the matter will be completely resolved soon,” Palumbo said.

Riverhead Supervisor Yvette Aguiar noted the property had “numerous violations for an extensive period of time,” and despite the town’s attempts to resolve the issues, “they remained noncompliant.”

Aguiar said she is happy about the agreement but “time will tell,” she said.

“We’ll stay on top of this until all the violations are corrected and they remain in compliance with our code,” Aguiar said.

Riverhead Town in 2013 banned transient rentals except by legally operating commercial hotel/motel businesses or bed-and-breakfast establishments. Transient rentals are defined by the code as rentals for a period of 29 days or less.

Despite the ban, dozens of private homes across town are still being offered for nightly rentals on Airbnb and similar websites.

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Denise is a veteran local reporter, editor, attorney and former Riverhead Town councilwoman. Her work has been recognized with numerous awards, including investigative reporting and writer of the year awards from the N.Y. Press Association. She is a founder, owner and co-publisher of this website.Email Denise.