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How Much Can My Landlord Raise My Rent? Michelle Itkowitz Article in Bushwick Daily

September 25, 2019

Recently a shorter version of this Article originally appeared in Bushwick Daily, where Michelle Itkowitz is the "Tenant’s Rights Adviser".

Hi, I'm Michelle Itkowitz, an instructor on the Tenant Learning Platform and Bushwick Daily's Tenant’s Rights Adviser. This is the fourth article in a series about your rights as a New York City Tenant. In this column, I am going to answer one of our reader’s specific questions.


BD Reader Question: "How much is my landlord allowed to raise my rent? And over what time period?"

Michelle’s Answer:

First, are you Rent Stabilized? Or is your apartment free-market? Your answer to my question will make all the difference!

HOW DO I KNOW IF I AM RENT STABILIZED OR FREE-MARKET?

Rent Stabilization applies to about one million tenancies in New York City. There is no official list somewhere that definitively tells the world which apartments are subject to Rent Stabilization. The NYS Division of Housing and Community Renewal (DHCR) has jurisdiction over matters relating to Rent Stabilization and the DHCR maintains some records. But the records the DHCR maintains contain information that is largely self-reported by landlords and that is not controlling with regard to an apartment’s Rent Stabilization status. The problem is that many landlords lie and say an apartment is free-market, when it is actually Rent Stabilized.

How do you ever get a definitive answer on an apartment’s Rent Stabilization status? With some exceptions, the last word on whether an apartment is Rent Stabilized is in the hands of the courts or the DHCR. Until a judge is satisfied that an apartment is not Rent Stabilized, the matter is always, in some measure, unsettled. Why is this so complicated? Because it is. There are many statutes and mountains of case law, stretching back to the 1970’s, that, when woven together, make up the rent regulatory scheme in New York City. There are rules, and exceptions to the rules, and exceptions to the exceptions to the rules. 

In general, if a Building was built before 1974 and contains six or more units or is new construction and is receiving a real estate tax exemption, then the apartments therein are Rent Stabilized unless certain exceptions apply. Therefore, if your landlord hits you with a huge rent increase, and even suspect that you are Rent Stabilized, you should first check with a lawyer who is qualified to evaluate your regulatory status. If you are Rent Stabilized, not only will that proposed rent increase not be valid, but the landlord probably owes you money on a rent overcharge case.

RENT STABILIZED TENANTS

If you are a Rent Stabilized tenant, you have mountains of rights. Rent Stabilization limits the rent an owner may charge for an apartment and restricts the right of an owner to evict tenants. Rent Stabilized tenants are entitled to leases and lease renewals. Even if landlord fails to renew a Rent Stabilized tenant’s lease, all tenant’s rights remain intact. Rent Stabilization Code (“RSC”) § 2523.5. If a Rent Stabilized lease is not properly renewed, a landlord cannot sue tenant for the rent. Paid Enters. v. Gonzalez, 173 Misc.2d 681, 682 (App. Term 2nd Dept. 1997) ("Rent [S]tabilization is a lease-based regulatory scheme. As such, a tenant's obligation to pay the stabilized rent is dependent on the tenant's agreement to pay it."). Family members of a Rent Stabilized tenant residing in a Rent Stabilized apartment often have succession rights to the tenancy. RSC § 2523.5(b)(1); RSC § 2520.6(o).

Under Rent Stabilization, landlord is required to follow a very specific procedure for Rent Stabilized lease renewals. Leases must be entered into and renewed for one- or two-year terms, at the tenant's choice. RSC § 2522.5. Landlord must send the lease renewal offer between 150 and 90 days before the expiration of the current lease. RSC § 2523.5. Every lease renewal offer must have a special DHCR rider attached. RSC § 2522.5. A Rent Stabilized lease renewal offer must be on the same terms and conditions as the expired lease. RSC § 2522.5.

Rent increases for Rent Stabilized tenants are controlled by the NYC Rent Guidelines Board, which sets maximum rates for rent increases once a year, which are effective for leases beginning on or after October 1st. Long story short, a Rent Stabilized tenant’s rent goes up much more gradually that a free-market tenant’s rent.

FREE-MARKET TENANTS

But let’s say you are certain that you are not Rent Stabilized; you are a free-market tenant. Then your landlord can ask to raise your rent as much as they want to. You do not have to agree to the rent increase. If, however, you do not agree to the increase and do not leave on your own, the landlord can eventually bring a holdover case (an eviction case) against you.

As of June 14, 2019 of this year, the NYS legislature passed the Housing Stability and Tenant Protection Act (“HSTPA”). As a result of the HSTPA, Real Property Law § 266(c) now requires landlord to give tenant notices to increase a free-market tenant’s rent by five percent (5%) or more or to refuse to renew a free-market tenancy. Real Property Law § 226-c (Notice of rent increase or non-renewal of residential tenancy) has been added and states:

"1. Whenever a landlord intends to offer to renew the tenancy of an occupant in a residential dwelling unit with a rent increase equal to or greater than five percent above the current rent, or the landlord does not intend to renew the tenancy, the landlord shall provide written notice as required in subdivision two of this section. If the landlord fails to provide timely notice, the occupant's lawful tenancy shall continue under the existing terms of the tenancy from the date on which the landlord gave actual written notice until the notice period has expired, notwithstanding any provision of a lease or other tenancy agreement to the contrary. 2. (a) If the tenant has occupied the unit for less than one year and does not have a lease term of at least one year, the landlord shall provide at least thirty days' notice. (b) If the tenant has occupied the unit for more than one year but less than two years, or has a lease term of at least one year but less than two years, the landlord shall provide at least sixty days' notice. (c) If the tenant has occupied the unit for more than two years or has a lease term of at least two years, the landlord shall provide at least ninety days' notice."

Here is a chart that makes the new rules easier to understand:



If the landlord fails to provide the written notice in the allotted time frames to the tenant regarding a rent increase or a non-renewal, then the tenancy continues under its existing terms (even if the lease has expired) until the required notice has been given and the notice period has expired.

This law is very new and is a big change. Therefore, many landlords may not even know about this. Send your landlord a copy of this article if they try to raise your rent more than 5 percent, refuse to renew your lease, or bring an end-of-lease holdover eviction proceeding against before giving you the required notice.




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Michelle's Guide to the Rent Stabilization Laws of 2019

Updated August 11, 2019 (Originally published June 17, 2019)

I represent as many residential tenants as I do residential landlords, probably more tenants at this point. I am neither a residential tenant nor a multifamily real estate investor. I got no horse in this race. Therefore, as always, you can rely on me to tell you what’s really going on.

This article will deal only with the changes to the Rent Stabilization Law in New York City as codified in a new law entitled, the Housing Stability Tenant Protection Act of 2019 ("HSTPA"). I am writing a separate article about the Act’s changes to other real property laws, which will affect ALL tenants in New York City, and that article should be up in a few days.

I. READ THE LAW



This article is NOT exhaustive as to the 2019 changes in the Rent Stabilization Law in New York City. This article covers what I think my readers will be most interested in. 

II. WHY THE LAW NEEDED TO CHANGE


As I explained in these pages years ago, a bad trend developed over the last 20 years in New York City multifamily housing, whereby speculators over-paid for buildings containing Rent Stabilized apartments, with the intention of raising the rents and eventually deregulating the apartments, thus raising the rent roll substantially to make a large and quick profit on these assets. 

But the rent could only go up and apartments could only be deregulated if long-term existing tenants vacated. This prompted the speculators to bring legal cases against many long-term tenants, not always based on solid grounds. It also prompted the speculators to buy tenants out and/or harass tenants out. When vacancies occurred, higher rents and deregulations depended on the owners doing six-figures worth of work in an apartment. Often, that work never really happened. Landlords would often lie about the amount spent on individual apartment improvements. Add to this the rampant abuses related to “Preferential Rents”, and that’s how you end up with 250,000 illegally deregulated Rent Stabilized apartments

The law needed to evolve to curb these abuses. Nevertheless, all of the law-abiding good landlords get hurt along with the nefarious ones.

III. HOW THE RENT STABILIZATION LAW CHANGED IN NEW YORK CITY IN JUNE 2019


A. There is no longer a rent-increase pathway to deregulation.


In June 2019, the New York State legislature took away the incentive for a landlord to seek a vacancy. The new law repeals statutes that allowed units to be deregulated on vacancy if the rent reached $2,744, or if that rent is lawfully achieved while a tenant earning $200k a year or more resided in the apartment. In short, there is no longer a rent-increase pathway to deregulation. 

B. The legislature severely limited the ability of owners to take rent increases on vacancies.


Moreover, the legislature severely limited the ability of owners to take rent increases on vacancies, further dampening a landlord’s appetite for tenant turnover. The new law:
  • Repeals the statutory vacancy bonus, which allows landlords of Rent Stabilized apartments to create an automatic increase in rent up to 20% on vacancy; and
  • Repeals the vacancy longevity bonus.
The rent for the new tenant is the rent that the old tenant paid, plus applicable Rent Guidelines Board increases, which historically are very low (as I write this, they are 1.5% for a one-year lease and 2.5% for a two-year lease). The new law says:
"Any tenant who is subject to a lease on or after the effective date of a chapter of the laws of two thousand nineteen which amended this subdivision, or is or was entitled to receive a renewal or vacancy lease on or after such date, upon renewal of such lease, the amount of rent for such housing accommodation that may be charged and paid shall be no more than the rent charged to and paid by the tenant prior to that renewal, as adjusted by the most recent applicable guidelines increases and any other increases authorized by law."
Furthermore, individual apartment improvement increases (“IAI’s”) have changed dramatically pursuant to the new law. Landlords may only spend $15k in 15 years on IAI’s. Landlord may only add to the rent 1/168th of such IAI’s to a vacancy rent. That’s about $89. In addition, major capital improvement expenditure increases (“MCI’s”) have been curtailed. It is beyond the scope of this already-long article to go into the details on MCI’s. Again, I encourage anyone contemplating MCI’s to read the new law carefully. 

Long story short, the rent rolls for buildings containing Rent Stabilized apartments can be expected to increase much more modestly than before HSTPA.

C. Preferential Rent remains in place for a whole tenancy.


The new law reforms Preferential Rents. The new law:
  • Prohibits owners who offer tenants a "preferential rent," or rent below the legal regulated rent, from discontinuing the use of preferential rent or raising the rent to the full legal amount upon lease renewal.
  • But it allows landlords to charge any rent up to the full legal regulated rent once the tenant vacates the unit, as long as the tenant did not vacate due to the owners failure to maintain the unit.
This is the text of the new law (the green words were added, and the red words were stricken):


D. Momentous Changes to Rent Overcharge Laws


When it comes to the new laws, everyone seems to be talking about de-regulation and rent increases and, of course, those are important issues. But a close-second in importance are the momentous changes to the Rent Stabilization laws regarding rent overcharges. 

1. There is no statute of limitations on an overcharge claim.


First, there is no longer any statute of limitations on a rent overcharge! Formerly, there was a four-year statute of limitations (CPLR § 213-a). That meant that an overcharge claim had to be filed within four years of the last overcharge. Now CPLR § 213-a states, “…an overcharge claim may be filed at any time…” This means that many more tenants will be eligible to file overcharge claims.

2. A court or the DHCR can look back as far as it wants and at as many sources of information as it deems appropriate, when attempting to determine if there is an overcharge and at what level the legal rent should be set.


Furthermore, a court or the DHCR can look back as far as it wants and at as many sources of information as it deems appropriate, when attempting to determine if there is an overcharge and at what level the legal rent should be set. Before this amendment to the law, a court or DHCR could only look back four-years when determining if there was an overcharge, unless there was evidence of fraud and in some other limited circumstances. 

Let us look at all the material added to the law to give a court or DHCR latitude in overcharge matters:
"The [DHCR], and the courts, in investigating complaints of overcharge and in determining legal regulated rents, shall consider all available rent history which is reasonably necessary to make such determinations, including but not limited to:
(i) any rent registration or other records filed with [DHCR], or any other state, municipal or federal agency, regardless of the date to which the information on such registration refers;
(ii) any order issued by any state, municipal or federal agency;
(iii) any records maintained by the owner or tenants; and
(iv) any public record kept in the regular course of business by any state, municipal or federal agency. Nothing contained in this subdivision shall limit the examination of rent history relevant to a determination as to:
(i) whether the legality of a rental amount charged or registered is reliable in light of all available evidence including but not limited to whether an unexplained increase in the registered or lease rents, or a fraudulent scheme to destabilize the housing accommodation, rendered such rent or registration unreliable;
(ii) whether an accommodation is subject to the emergency tenant protection act or the rent stabilization law;
(iii) whether an order issued by the [DHCR] or by a court, including, but not limited to an order issued pursuant to section 26-514 of this chapter, or any regulatory agreement or other contract with any governmental agency, and remaining in effect within six years of the filing of a complaint pursuant to this section, affects or limits the amount of rent that may be charged or collected;
(iv) whether an overcharge was or was not willful;
(v) whether a rent adjustment that requires information regarding the length of occupancy by a present or prior tenant was lawful;
(vi) the existence or terms and conditions of a preferential rent, or the propriety of a legal registered rent during a period when the tenants were charged a preferential rent;
(vii) the legality of a rent charged or registered immediately prior to the registration of a preferential rent; or
(viii) the amount of the legal regulated rent where the apartment was vacant or temporarily exempt on the date six years prior to a tenant's complaint."
[Emphasis supplied.]

These changes to the Rent Stabilization laws regarding rent overcharges were made to stem the problems I discussed at the beginning of this article and in several of my earlier articles. Bad landlords counted on the passage of time to insulate them from their indiscretions with a rent roll. Before these changes, if a landlord illegally raised the rent, all the landlord had to do was wait and hope that no tenant challenged the illegal jump in the next four-years. The HSTPA eliminates this loophole. I will provide examples, so you can see how sweeping these changes are. 

Example of How the Overcharge Law Worked Before June 2019: In 2004 (15 years ago), a landlord illegally jumped the rent ahead from $600 per month to $1,600 per month. But after that big jump, the landlord only took legal increases. It’s 2018 and a tenant asks the DHCR to determine whether she has been overcharged. The DHCR can only look back 4 years (to 2014). When it looks back to 2014 and examine the rent increases landlord implemented since then, they all check out. The landlord in this example got away with the illegal jump in 2004.

Example of How the Overcharge Law Works Now: In 2004 (15 years ago), a landlord illegally jumped the rent ahead from $600 per month to $1,600 per month. But after that big jump, the landlord only took legal increases. It’s July 2019 and a tenant asks the DHCR to determine whether she has been overcharged. The DHCR can look back all the way to 2004 and question the $1,000 jump. The DHCR (or a court, by the way) can look at any rent registration or other records filed with the DHCR, any orders in any earlier cases or issued by HPD for violations, any records maintained by the owner or tenants, etc. Maybe the landlord is claiming it did $40k of work in the apartment in 2004. But maybe tenant has pictures from 2004, when she moved in, showing that the apartment was not newly renovated at that time. 

3. There were radical changes to the treble damage section of the law and attorneys' fees are now mandatory.


The most radical changes to the overcharge laws, however, are contained in the damages section. Before these amendments to the Rent Stabilization law, a court or DHCR could award a tenant up to four years of damages for an overcharge. With these amendments, however, now a court or the DHCR can award a tenant up to six years of damages for an overcharge. 

Moreover, what makes overcharge findings so devastating to landlords is the punitive damages section built into the law, and those sections in this new law are on steroids. Before these changes to the law, a landlord caught overcharging a tenant could simply refund the overcharged amount and avoid any punitive damages. The new law removes the ability of owners to avoid punitive damages if they voluntarily return the amount of the rent overcharge prior to a decision being made by a court or the DHCR. And wow are the new damages punitive! 

Under the new law, if a court or a DHCR finds that an overcharge is willful, it can order that the landlord refund to tenant not only the amount it overcharged tenant, but also triple the amount of the overcharge for six full years. Before the change in the law, a court or DHCR could only award two years of triple damages. 

Let’s look at another (rough) example to see the impact of this change:



Finally, the new law makes is mandatory (not up to DHCR’s or a court’s discretion, as was the case up until June 14, 2019) to award an overcharged tenant costs, reasonable attorney’s fees, and interest for the overcharge. 

IV. PREDICTION - EPIC BATTLES OVER ILLEGALLY DEREGULATED APARTMENTS. EPIC!!!


I do not like making predictions, but that is what everyone asks for. So, here’s what I foresee.

I have long had a service for tenants to help them figure out whether their allegedly free-market apartment is actually subject to Rent Stabilization. I have also long had a Rent Stabilization Due Diligence product for landlords, the main purpose of which is to detect illegally deregulated apartments. I predict that both of these services will be in even greater demand. 

Every apartment that gets swatted back into Rent Stabilization is never…coming…out. And now it’s easier to get an apartment wrongly deregulated back into Rent Stabilization, because of the enhanced look-back options built into the new law. And when an apartment goes back into Rent Stabilization, its going in with a healthy overcharge award. With these new laws, tenants have much greater incentives to challenge the regulatory status of their apartment. And would-be multifamily purchasers have greater incentive to question the efficacy of alleged deregulations. 

This will be the new battlefield in the wake of these new laws. Landlords were the hunters (the ones bringing frequent cases against tenants), and now they shall be the hunted (the ones defending against cases brought by tenants), as Legal Aid and private tenant attorneys seek to push as many of those 250,000 illegally deregulated units back into Rent Stabilization and win an overcharge award along with the re-regulation. 

My only concern is that there may not be adequate enforcement of these laws for middle class New Yorkers. Low income New Yorkers have Legal Aid. Higher income New Yorkers have firms like mine. Middle class New York will still need help navigating their rights under these laws. This year, I launched an initiative separate from my law firm, for just this purpose – the Tenant Learning Platform. Unfortunately, the TLP is still too young to tackle illegal deregulation. But stay tuned…

V. WHAT OPPORTUNITIES STILL EXIST FOR REAL ESTATE INVESTORS


There are several sectors of multifamily investment that are unaffected by the HSTPA. There are still assets that investors can purchase that contain Rent Stabilized apartments that will deregulate themselves by operation of law. These include:

A. Blocks of Co-Op Sponsor Apartments


I see nothing in these new laws that prevents a co-op apartment long occupied by a non-purchasing tenant who is currently Rent Stabilized, from becoming deregulated when the tenant finally surrenders the apartment, at which point the unit can be sold to a shareholder. I have several clients who invest in blocks of these apartments. 

B. Substantially Rehabilitated or New Construction Buildings Where Tax Abatements Expiring


I see nothing in these new laws that prevents a building that is subject to Rent Stabilization SOLELY by reason of the receipt of a tax abatement from deregulating organically at the end of an abatement period. With such buildings, it is crucial that the prospective buyer do Rent Stabilization Due Diligence to make sure that the building does not have a reason, independent of the abatement, for being subject to Rent Stabilization. Moreover, every lease and renewal must be checked for the proper rider language. Absent the right language, tenants will remain Rent Stabilized after the expiration of the abatement.

C. Legitimately Deregulated Apartments


Nine out of ten alleged deregulations that I analyze are illegitimate and those apartments belong back in Rent Stabilization. That still leaves one in ten, however, that were correctly deregulated. As I suggested above, those apartments are going to be worth their weight in gold. They are out there; investors just have to invest in Rent Stabilization Due Diligence to find them. 


On June 20, 2019, the legislature added an addendum to the new law, clarifying that, “any unit that was lawfully deregulated prior to June 14, 2019 shall remain deregulated…”

D. Development


I see nothing in these new laws that prevents an owner from applying to DHCR for permission not to renew Rent Stabilized leases because the applicant-owner has shown DHCR approved plans from the New York City Department of Buildings for a new building and a legitimate loan commitment to finance such project. The only change to this type of application I see is that a judge can give a tenant relocated pursuant to such non-renewal up to a year to relocate. Over the years I have been consulted by many owners about this option. Many of them were unenthusiastic when I reminded them that the new building would be subject to a new tax assessment. But tax abatements in exchange for a period of rent regulation are also available. I predict that these new laws will cause various owners to reconsider the development option. That’s probably a good thing, inasmuch as this increases the amount of affordable housing in New York City. 


VI. 421-a(16) EXCEPTION


The STPA was amended on June 20, 2019 to state that:


"a market rate unit in a multiple dwelling which receives benefits pursuant to subdivision 16 of section 421-a of the real property tax law shall be subject to the deregulation provisions of rent stabilization as provided by law prior to June 14, 2019."



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Michelle's Guide to General Changes in Residential Landlord and Tenant Laws in New York City, Occasioned by the Statewide Tenant Protection Act of 2019

July 15, 2019

This is Part 3 of my series of articles on the Housing Stability Tenant Protection Act of 2019 (“HSTPA”). This short article rounds out our examination of the STPA and covers topics that did not fit in to Part 1 (about how the HSTPA changed the Rent Stabilization Law in New York City) or Part 2 (about how the HSTPA changed procedures in the landlord and tenant litigation process in New York City)


I. RPL § 226(c) NEW NOTICES TO INCREASE A NON-REGULATED TENANT’S RENT OR TO REFUSE TO RENEW NON-REGULATED TENANCIES


Real Property Law § 226-c (Notice of rent increase or non-renewal of residential tenancy) has been added and states:


"1. Whenever a landlord intends to offer to renew the tenancy of an occupant in a residential dwelling unit with a rent increase equal to or greater than five percent above the current rent, or the landlord does not intend to renew the tenancy, the landlord shall provide written notice as required in subdivision two of this section. If the landlord fails to provide timely notice, the occupant's lawful tenancy shall continue under the existing terms of the tenancy from the date on which the landlord gave actual written notice until the notice period has expired, notwithstanding any provision of a lease or other tenancy agreement to the contrary.
2. (a) If the tenant has occupied the unit for less than one year and does not have a lease term of at least one year, the landlord shall provide at least thirty days' notice.
(b) If the tenant has occupied the unit for more than one year but less than two years, or has a lease term of at least one year but less than two years, the landlord shall provide at least sixty days' notice.
(c) If the tenant has occupied the unit for more than two years or has a lease term of at least two years, the landlord shall provide at least ninety days' notice."

Coupling this section together with the anti-retaliatory eviction statute discussed in Part 2 of this series, it almost becomes like a form of limited rent regulation for free-market apartments. Landlords can no longer refuse to renew tenants or raise their rents exorbitantly with the same ease as before these changes. 


II. RPL § 227-e A RESIDENTIAL LANDLORD NOW HAS A DUTY TO MITIGATE DAMAGES IF A TENANT BREACHES A LEASE.


A residential landlord now has a duty to mitigate. Landlord must take “reasonable and customary actions to rent the premises at fair market value or at the rate agreed to during the tenancy, whichever is lower.” Once landlord re-rents, the new lease terminates the old lease. 

This is a big change and will make it much easier now for tenants to break residential leases.


III. RPL 238-a(2) RESIDENTIAL LATE FEES NOT TO EXCEED $50 (OR 5%)


The maximum late fee that landlord may charge per month, after the rent is five days late, is $50 (or 5%, whichever is lower). 


IV. GOL 7-107 AMENDED SO NO RESIDENTIAL “DEPOSIT OR ADVANCE” SHALL EXCEED ONE MONTH’S RENT AND OTHER CHANGES TO 


NYS General Obligations Law § 7-107 was amended so that, “No [residential] deposit or advance shall exceed the amount of one month’s rent under such contract.” Please notice that the statute affects “advances” as well as deposits. 

There were many other changes to the security deposit statute under GOL § 7-107 that landlords and tenants should read and make themselves aware of, including, but not limited to the fact that there are now inspection provisions that apply both before possession is taken and after vacatur, and if an itemized statement of damages is not provided within a limited time after tenant vacates, landlord will forfeit her right to the deposit. 

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Michelle's Guide to Changes in the Landlord and Tenant Litigation Process in New York City, Occasioned by the Statewide Tenant Protection Act of 2019

June 26, 2019

This is Part 2 of my series of articles on the Housing Stability and Tenant Protection Act of 2019 (“HSTPA”). This article is about how the STPA changed procedures in the landlord and tenant litigation process in New York City.[fn1] Part 1 was about how the HSTPA changed the Rent Stabilization Law in New York City. The final article in the series will address other changes in the STPA and will come out in about a week.

I. RPL § 232-a TERMINATION OF MONTH-TO-MONTH TENANCY NEW TIME PERIODS


We have new time periods for terminating a month-to-month tenancy in the City of New York in a new Real Property Law § 232-a. The newly drafted statute incorporates time periods for termination by reference to RPL § 226-c, which states:


"2. (a) If the tenant has occupied the unit for less than one year and does not have a lease term of at least one year, the landlord shall provide at least thirty days' notice.
(b) If the tenant has occupied the unit for more than one year but less than two years, or has a lease term of at least one year but less than two years, the landlord shall provide at least sixty days' notice.
(c) If the tenant has occupied the unit for more than two years or has a lease term of at least two years, the landlord shall provide at least ninety days' notice."

Commercial month-to-month tenancies in the New York City may still be terminated on 30 days’ notice.


II. RPL § 235-e(d) EXTRA PREDICATE NOTICE FOR RECOVERING RENT


Real Property Law § 235-e has been modified to add the following paragraph:


"(d) If a lessor, or an agent of a lessor authorized to receive rent, fails to receive payment for rent within five days of the date specified in a lease agreement, such lessor or agent shall send the lessee, by certified mail, a written notice stating the failure to receive such rent payment. The failure of a lessor, or any agent of the lessor authorized to receive rent, to provide a lessee with a written notice of the non-payment of rent may be used as an affirmative defense by such lessee in an eviction proceeding based on the non-payment of rent."

This new subparagraph “d” is tucked at the end of the “Duty to provide a written receipt” section of the Real Property Law. Nevertheless, it seems to me that this new subsection’s implications go far beyond anything to do with providing a rent receipt. There are two major things to consider here. First, does this new requirement apply to commercial tenancies as well as residential ones. Second, how does the new RPL § 235-e(d) notice fit in with the service of a rent demand or notice to cure for failure to pay rent in the commercial context?


A. Does RPL § 235-e(d) apply to commercial tenancies as well as residential ones?


The RPL § 235 series is a little but frustrating. The section has a definite residential feel about it. After all, RPL 235-b codifies the residential warranty of habitability. But one has to be careful. The majority of the sections of the RPL § 235 series state they refer to "multiple dwellings", "rental agreements for residential premises", "residential leases". Yet other sections of RPL § 235 series do not claim to be applicable to only residential tenancies. It is generally agreed that such sections apply also to commercial tenancies. RPL § 235-e(d) does not say that it only applies to residential tenancies. The difficulty arises because the rest of RPLR § 235-e is obviously designed for residential tenancies, and it seems downright silly that this new section "d" should apply to commercial tenancies. A sophisticated commercial tenant now needs a note from the landlord, reminding it to pay the rent, on top of the statutory rent demand?

Nevertheless, RPL § 235-e(d) does not  limit itself to residential tenancies, and therefore, I am going to assume that it applies to commercial tenancies until an appellate court tells me otherwise or the legislature clarifies the matter. 


B. How does the RPL § 235-e(d) notice fit in with the service of a rent demand or notice to cure for failure to pay rent in the commercial context?


Clearly, the RPL § 235-e(d) notice is an additional predicate step that must be followed before a summary proceeding for the nonpayment of rent can be initiated. The RPL § 235-e(d) notice can NOT be combined with the statutory rent demand of RPAPL § 711. They are totally different things. So the question then arises, does the RPL § 235-e(d) notice have to be served before the RPAPL § 711 rent demand? Is so, how much sooner?

Until I get more guidance from an appellate court or the legislature, I am looking for this answer to New York Civil Practice Law and Rules § 2103(b)(2) (Service of papers):


"...where a period of time prescribed by law is measured from the service of a paper and service is by mail, five days shall be added to the prescribed period if the mailing is made within the state..." 

See also ATM One, LLC v. Landaverde, 2 N.Y.3d 472 (2004), which applied CPLR § 2103 to notices to cure called for in the Rent Stabilization Code. I know, it's not exactly applicable because RPL § 235(e)-d does not contain a "period of time prescribed by law", rather it is just a reminder. Yet it seems, to me, that the purpose of a reminder is defeated if the reminder is not allowed to reach the tenant before the landlord issues a formal RPAPL § 711 rent demand. So, until precedent gives us an answer, I am waiting until five days after the certified mailing of the RPL § 235-e(d) notice before I have the landlord issue and serve the RPAPL § 711 rent demand.

Finally, just like a statutory rent demand, the RPL § 235-e(d) notice needs to be issued by the landlord; it cannot be issued by landlord’s attorney. 


III. 14-DAY RENT DEMAND UNDER RPAPL § 711


Rent demands for residential and commercial tenants will now be on 14-days’ notice, up from three days before the Real Property Actions and Proceedings Law § 711 was changed.

RPAPL § 711 goes on to add a special protection for the successors to tenant after the tenant dies. If landlord wants to sue for the rent at that point, landlord may only go after tenant’s estate, but doing so is without prejudice to the possessory rights of the successors. I am not sure this is really a change from how such a claim would have been handled before the statute was amended. 


IV. PAYMENT IS A DEFENSE TO NONPAYMENT RPAPL § 731(4)


Newly added Real Property Actions and Proceedings Law § 731(4) states:


"In an action premised on a tenant defaulting in the payment of rent, payment to the landlord of the full amount of rent due, when such payment is made at any time prior to the hearing on the petition, shall be accepted by the landlord and renders moot the grounds on which the special proceeding was commenced."

Again, payment was always treated as a defense to a nonpayment summary proceeding, so I am not sure that this section does anything but codify case law and accepted procedure.


V. RPAPL § 732 - NONPAYMENT PETITION RETURNABLE WITHIN 10 AFTER IT IS SERVED, AND RPAPL § 733 - A HOLDOVER PETITION MUST BE SERVED BETWEEN TEN AND SEVENTEEN DAYS BEFORE THE PETITION IS NOTICED TO BE HEARD. 


Tenants now have ten days to answer a nonpayment petition, courtesy of the new Real Property Actions and Proceedings Law § 732.

A holdover petition must be served between ten and seventeen days before the petition is noticed to be heard, courtesy of the new Real Property Actions and Proceedings Law § 733.

Also, RPAPL §743 has been changed to take out that complicated nonsense about if a tenant got served within eight days of the court date they would have to answer within three days of the court date. No one is going to miss that. 


VI. RENT DEPOSIT STATUTE RPAPL § 745(2) MUCH LESS VERSATILE FOR LANDLORD


RPAPL § 745(2) now says that after two adjournments requested solely by tenant or sixty days charged solely to tenant (as opposed to thirty days), whichever is shorter, that landlord can move for tenant to be ordered to deposit ongoing use and occupancy (i.e. rent). Also, those adjournments don’t count against tenant if tenant is asking for the time in order to get a lawyer. 

The new RPAPL § 745(2) tells us that this request has to be made via a motion (not an application) and that the court can only order the deposit of use and occupancy going forward from the date of the court's order (as opposed to use and occupancy that accrued from the date of the petition). 

The new RPAPL § 745(2) also expands the lists of defenses that, if interposed properly by tenant, will defeat the motion for the rent deposit. Such defenses include:


"(i) the petitioner is not a proper party to the proceeding pursuant to section seven hundred twenty-one of this article; or(ii) (A) actual eviction, or (B) actual partial eviction, or (C) constructive eviction; and respondent has quit the premises; or(iii) a defense pursuant to section one hundred forty-three-b of the social services law; or(vi) a defense based upon the existence of hazardous or immediately hazardous violations of the housing maintenance code in the subject apartment or common areas; or(v) a colorable defense of rent overcharge; or(vi) a defense that the unit is in violation of the building's certificate of occupancy or is otherwise illegal under the multiple dwelling law or the New York city housing maintenance code; or(vii) the court lacks personal jurisdiction over the respondent."

Under the new RPAPL § 745(2), if tenant is ordered to deposit the ongoing use and occupancy but fails to, the court no longer has the discretion to strike the tenant’s answer, containing tenant’s defenses and counterclaims. 

RPAPL § 745(2) is not getting a lot of attention, but I predict this is going to be one of those quiet game-changers, because this section will affect tactical considerations by both sides. When it is less likely that a tenant will be ordered to pay rent during a proceeding, a judgment-proof tenant then has little incentive not to delay the case if said tenant values the opportunity to gain time to either live rent free or find his or her next home. This should increase a landlord’s incentive to settle quickly on terms favorable to tenant. 


VII. RPAPL § 749 WARRANTS


Real Property Actions and Proceedings Law § 749, regarding warrants of eviction, has changed.

The warrant now must include the earliest date upon which it can be executed.

The new RPAPL § 749 allows the court to stay re-letting and renovation of the premises for a “reasonable period of time”. The language of the statute is not clear to me, but I assume this means for a reasonable time after the warrant is executed. 

A tenant must now receive at least fourteen days’ notice of an eviction served upon tenant by the marshal.

The new RPAPL § 749 no longer says that the landlord and tenant relationship is terminated upon issuance of the warrant, and goes on to say that the tenant may pay the full rent due anytime before the warrant is issued, which will cause the court to vacate the warrant. 


VII. LONGER HARDSHIP STAYS AND THE RIGHT TO CURE RPAPL § 753


As per RPAPL § 753:


"In the event that [a] proceeding is based upon a claim that the tenant or lessee has breached a provision of the lease, the court shall grant a thirty day stay of issuance of the warrant, during which time the respondent may correct such breach."

The tail-end cure period used to be only ten days.

Also, as per RPAPL § 753, the court can stay the issuance of a warrant of eviction for up to a year in the event of hardship. What “hardship” might mean is spelled out in detail and should be reviewed by all practitioners. Again, as always, I encourage everyone to read the law closely for themselves. 




IX. RPL § 223-b THE RETALIATORY EVICTION DEFENSE HAS BEEN EXPANDED TO ENCOMPASS MORE TENANT ACTIVITIES


The retaliatory eviction defense has been expanded to encompass more tenant activities. 

First, landlord retaliation is prohibited not only when tenant complains to a government authority, but also when tenant complains directly to the landlord or to landlord’s agent.

Second, landlord retaliation is prohibited not only when tenant alleges a violation of law but also when tenant alleges a violation of the warranty of habitability.

Third, landlord may not, among other things, retaliate by outright refusing to renew the lease or offering to renew the lease at “an unreasonable rent increase”.


Fourth, the rebuttable presumption now exists for a year from tenant’s attempts to enforce her rights; the presumption formerly existed for six months from such complaint. 


X. RPAPL § 702 - IN A RESIDENTIAL SUMMARY PROCEEDING, ONLY RENT MAY BE SUED FOR, NOT ADDITIONAL RENT OR LATE FEES



In a residential summary proceeding, only rent may be sued for, not additional rent or late fees. RPAPL § 702 states:


Rent in a residential dwelling. In a proceeding relating to a residential dwelling or housing accommodation,  the  term  "rent"  shall mean  the  monthly or weekly amount charged in consideration for the use and occupation of a dwelling pursuant to a written or oral rental agreement.  No fees, charges or penalties other than rent may be sought in a summary  proceeding  pursuant  to  this  article,  notwithstanding  any language to the contrary in any lease or rental agreement.

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fn1. This article is NOT exhaustive as to how the STPA changed procedures in the landlord and tenant litigation process in New York City. This article is also boring. What can I say, procedure is boring, but important. 

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Goodbye Yellow Brick Road…and Goodbye Yellowstone Injunction? Michelle Itkowitz Teaches CLE at National Law Institute About the New Redbridge Case


On May 21, 2019, Michelle Itkowitz taught a Continuing Legal Education class for The York Group, LLC, with the National Law Institute, hosted by Morgan Stanley, entitled Goodbye Yellow Brick Road…and Goodbye Yellowstone Injunction? The Implications of 159 MP Corp.v Redbridge Bedford, LLC for commercial tenants and landlords.

Below is a copy of the materials presented.


I. WHAT A YELLOWSTONE INJUNCTION IS AND WHY IS IT IMPORTANT TO COMMERCIAL TENANTS AND LANDLORDS


A. Types of Defaults Subject to Conditional Limitations in a Lease


One of the landlord’s most powerful remedies, a default subject to a conditional limitation pursuant to the lease, permits the landlord to terminate the lease by following certain procedures.

1. Non-Rent Defaults Subject to Conditional Limitations


The following are events of default subject to a conditional limitation under the Real Estate Board of New York, Inc.’s Standard Form of Store Lease (“the REBNY Lease”):

"If the Tenant defaults in fulfilling any of the covenants of this lease other than the covenants for the payment of rent or additional rent; or if the demised premises becomes vacant or deserted; or if any execution or attachment shall be issued against Tenant or any of Tenant’s property whereupon the demised premises shall be taken or occupied by someone other than Tenant; or if the lease be rejected under Section 365 of Title II of the U.S. Code (Bankruptcy Code); or if Tenant shall have failed, after five (5) days written notice, to redeposit with Owner any portion of the security deposit hereunder which Owner has applied to the payment of any rent and additional rent due and payable hereunder; or if Tenant shall be in default with respect to any other lease between Owner and Tenant; or if Tenant shall fail to move into or take possession of the premises within thirty (30) days after the commencement of the term of this lease…."

Other defaults which may be included in the lease as subject to a conditional limitation are: 

  • assigning, mortgaging or encumbering the lease or subletting without the landlord’s permission
  • the filing of a mechanic’s lien against the premises which is not discharged within a period of time after notification of the tenant by the landlord
  • the failure to maintain insurance
  • assigning the lease, or any interest in the lease, transfer ownership of the lease 
  • illegal sublets
  • closing for a period of ten or more days not for landlord authorized renovations

2. Nonpayment of Rent as a Conditional Limitation


Although the many leases specifically exclude such, a lease can provide a mechanism whereby landlord may terminate the lease, after default in the payment of rent, in the commercial context. Properly drafted, a conditional limitation clause for the nonpayment of rent in a commercial lease will be enforced by the courts and is, perhaps, the landlord’s most powerful remedy, nonpayment being the most common default. This is particularly true where the market has quickly improved and the lease-rent has fallen “below market". A properly structured conditional limitation for the non-payment of rent should utilize the language cited approvingly by the court in Grand Liberte Co-op Inc. v. Billhaud126 Misc.2d 961 (1st Dept. App. Term. 1984), expressly making the conditional limitation applicable to rent defaults and stating that “it [is] the intention of the parties hereto to create hereby a conditional limitation". Note, however, that this strategy will not work in a residential context. A conditional limitation regarding the nonpayment of rent in a residential lease has been held to violate public policy as it would provoke a forfeiture, and the law disfavors automatic forfeitures of residential tenancies. Semans Family Ltd. Partnership v. Kennedy, 177 Misc.2d 345 (N.Y.C. Civ.Ct. N.Y. Cty. 1998).

B. Notice to Cure


In most commercial leases, the landlord must first notify the tenant of the default and set forth a time period in which the tenant must cure the default; or, if it is impossible to cure within the time period, it must set forth a time period in which the tenant must begin curing the default. This notice is commonly referred to as a “notice to cure default”.  

C. "Yellowstone" and Tolling Time to Cure Defaults


Giving a notice to cure may prompt the commercial tenant to initiate a proceeding in Supreme Court commonly referred to as a “Yellowstone", so called after the case of First National Stores v. Yellowstone Shopping Center, 21 N.Y.2d 630 (1968), rearg. denied, 22 N.Y.2d 827 (1968).

The essence of a Yellowstone is a declaratory judgment complaint accompanied by an emergency stay application (which is routinely granted, at least in the form of a temporary restraining order, pending a hearing on a preliminary injunction), which seeks a trial on the issue of whether the tenant is indeed in violation of the lease. This procedure is designed to toll the time the tenant would ordinarily have to cure a lease violation while the court resolves the issue of whether the tenant is indeed in violation and/or has cured the violation. If the court finds the tenant in violation, then by virtue of the stay of the notice to cure, the tenant still has the opportunity to cure the violation before the cure period ends. This process can buy the tenant significant time as the resolution of the proceeding can take months or years. 

The purpose of a Yellowstone injunction is to maintain the status quo by means of a temporary stay while the tenant challenges the landlord’s notice to cure. See e.g., Jemaltown of 125th Street, Inc. v. Leon Betesh/Park Seen Realty Assocs., 115 A.D.2d 381 (1st Dept. 1985); Fratto v. Red Barn Farmers Market Corp., 144 A.D.2d 635 (2nd Dept. 1988).Thus, the injunction tolls the cure period set forth in the landlord’s notice of default until there is a judicial determination of the parties’ rights. See, Finley v. Park Ten Associates, 83 A.D.2d 537 (1st Dept. 1981); South Ferry Building Co. v. J. Henry Schroder Bank & Trust Co., 91 A.D.2d 963 (1st Dept. 1983).  

To demonstrate one’s entitlement to a Yellowstone injunction, a tenant must demonstrate that he/she: (i) holds a valuable commercial lease (ii) has received a notice to cure; (iii) has requested injunctive relief prior to the termination of the lease; and (iv) is prepared and maintains the ability to cure the alleged default by any means short of vacating the premises. Garland v. Titan West Assocs., 147 A.D.2d 304 (1st Dept. 1989). “These standards reflect and reinforce the limited purpose of a Yellowstone injunction: to stop the running of the applicable cure period.” Graubard Mollen Horowitz Pomeranz & Shapiro v. 600 Third Avenue Associates, 93 N.Y.2d 508 (1999). 

A Yellowstone injunction can provide a modicum of protection to landlords as well as tenants, because such injunctions are often conditioned upon the tenant’s ongoing payment of rent and/or the posting of a bond to protect the landlord from a wrongfully issued injunction.

The First Department has held that commercial tenants have a right to a virtually automatic issuance of a Yellowstone injunction  and has held that in order to obtain a Yellowstone, rather than requiring the tenant to prove on his application that he can cure the alleged default, a tenant must merely state his desire and ability to cure the default by any means short of vacating the premises. See Herzfeld & Stern v. Ironwood Realty Corp., 102 A.D.2d 737 (1st Dept. 1984); 34 N.Y.Jur.2d § 261 (“where a tenant denies any default and demonstrates that the landlord has given notice of default, and where a period of time remains within which to cure, the tenant is entitled to a grant of preliminary relief in the form of a Yellowstone injunction; since the law does not favor forfeitures, the tenant is not required, as a prerequisite to such relief, to demonstrate a likelihood of success on the merits or an ability to cure, and the proper inquiry instead is whether a basis exists for believing that the tenant desires to cure and has the ability to do so through any means short of vacating the premises”). Furthermore, a tenant is entitled to a Yellowstone injunction when the tenant argues that he is not in violation of the lease, and that if he is, he agrees to cure any such violations. See Empire State Building Assocs. v. Trump Empire State Partners, 245 A.D.2d 225 (1st Dept. 1997) (where a tenant can show that it is able and willing to bring itself into compliance with the lease absent vacating the premises, forfeiture is inappropriate).  

If the tenant is successful in having the Yellowstone injunction implemented, then the landlord must answer the Supreme Court action and counterclaim for termination of the tenancy. 

D. Termination Notice


If no Yellowstone proceeding is commenced and the default is not cured or being cured by the date specified in the notice to cure or if the tenant refuses to cure (see below), then the landlord may notify the tenant that the lease will be terminated in a certain number of days, as per the lease. This notice is commonly referred to as a “notice of termination". Notices to cure and notices of termination pursuant to the terms of a lease are served on the tenant in accordance with the lease. No statute specifies other methods of service for notices given strictly pursuant to a lease. See Rose Assoc. v. Bernstein, 138 Misc.2d 1044 (N.Y.C. Civ.Ct. N.Y. Cty. 1988). If the lease is silent on a method of service, the method used must be “reasonable". 

After the expiration of the notice of termination, the landlord may commence a summary holdover proceeding against the tenant to recover possession of the premises (see more about summary proceedings below). In such event, the tenant can still argue there is no default or that the notices are defective. If tenant prevails, there is no harm to the tenancy. If the tenant does not prevail, the proceeding may well end with the eviction of the tenant.

E. Defaults the Tenant Refuses to Cure


If a tenant’s position is that it refuses to cure the default, Tenant can’t have the Yellowstone. In Linmont Realty, Inc. v. Vitocarl, Inc., 147 A.D.2d 618 (2nd Dept. 1989), the Yellowstone application was denied. There were 17 defaults, including failure to renew environmental liability insurance, failure to keep daily records of gasoline inventory, failure to have tanks tested, failure to permit the defendants to inspect records of tank tests and inventory control, failure to clean and maintain the premises, and illegally subletting a portion of the premises for the storage and distribution of newspapers. The Linmont court reasoned: 

"To procure a Yellowstone injunction, a commercial tenant must demonstrate, inter alia, that it has the desire and ability to cure the alleged default by any means short of vacating the premises. The plaintiff herein has made no offer to cure any of the charged defaults, alleging instead that many of the alleged defaults listed in the Notice of Termination of Lease were not its responsibility, that various conditions did not exist as claimed by the defendants, and that the remainder of the defaults had been waived by the defendants acceptance of rent with knowledge of their existence. [(internal quotation marks and citation omitted)]." 

F. Why Being in Supreme Court on a Yellowstone Case is Different Than Being In a Summary Proceeding in Civil Court


In most instances when a landlord finds it necessary to sue a commercial tenant to recover rent or possession of a premises, the proper vehicle is a summary proceeding for the recovery of real property. A summary proceeding for the recovery of real property (“summary proceeding”) is an expedited lawsuit, for the recovery of rent and possession of a premises, created by the New York State Legislature in 1820 and governed by Article 4 of the Civil Practice Law and Rules (“CPLR”) and Article 7 of the Real Property Actions and Proceedings Law (“RPAPL”). Summary proceedings are expeditious because the parties’ procedural rights and remedies are severely limited. Among other things, for example, the tenant’s time to answer the lawsuit is accelerated and, absent leave of court, there is no discovery. NYU v. Farkas, 121 Misc.2d 643 (N.Y. Civ. Ct. 1983) (defines “ample need” test for discovery to be allowed in a summary proceeding). 

Therefore, if there is not a successful Yellowstone application by a commercial tenant, then the case will, generally, go faster for the landlord and cost less for the landlord to prosecute. It should be noted that whether a case is litigated in Supreme Court, pursuant to a Yellowstone application and replete with discovery, or whether a case is litigated more swiftly in New York City Civil Court, via a summary proceeding – the merits are still the merits.

II. HOW THE REDBRIDGE CASE ALLOWS THE PARTIES TO WAIVE TENANT’S RIGHT TO SEEK A YELLOWSTONE INJUNCTION


A. Redbridge Holding


On May 7, 2019, 159 MP Corp. v. Redbridge Bedford LLC, 2019 WL 19955262019 N.Y. Slip Op. 03526, was decided by the New York State Court of Appeals. It was a 4-3 decision written by Chief Judge DiFiore, with a long dissent by Judge Wilson. 

The commercial leases in Redbridge were for 22-years, for 13,000 square feet space, and utilized a standard form with a 36-paragraph rider. The tenant was a Foodtown. Rents started at $341k per year and were to go up to $564k per year. I peeked at the Second Department case, 159 MP Corp. v. Redbridge Bedford LLC, 160 A.D.3d 176 (2nd Dept. 2018), for more details, and it appears that the lease began in 2010, and it was only four years into the 20+-year term when the landlord attempted to terminate. The alleged breaches, “included the failure to obtain various permits, the arrangement of the premises in a manner that created fire hazards, the existence of nuisances and noises, and the failure to allow for sprinkler system inspections…”.

Redbridge holds that:

"In New York, agreements negotiated at arm’s length by sophisticated, counseled parties are generally enforced according to their plain language pursuant to our strong public policy favoring freedom of contract. In this case, commercial tenants who unambiguously agreed to waive the right to commence a declaratory judgment action as to the terms of their leases ask us to invalidate that waiver on the rationale that the waiver is void as against public policy. We agree with the courts below that, under the circumstances of this case, the waiver clause is enforceable, requiring dismissal of the complaint."

B. The Specific Lease Language Upheld


The specific lease language upheld as enforceable by the Court of Appeals in Redbridge was this:

"Tenant waives its right to bring a declaratory judgment action with respect to any provision of this Lease or with respect to any notice sent pursuant to the provisions of this Lease . . . [I]t is the intention of the parties hereto that their disputes be adjudicated via summary proceedings."

III. THE NEW WAY THINGS WILL WORK FOR COMMERCIAL LANDLORD AND TENANT LITIGATORS - A CHART!


It would not be a CLE without a flowchart now would it!




IV. SOME GUESSES ABOUT THE REAL-LIFE IMPLICATIONS OF REDBRIDGE – I.E. YELLOWSTONE INJUNCTIONS ARE ALIVE AND WELL AND PROBABLY WILL BE FOR A WHILE.


Yellowstone injunctions are alive and well and probably will be for a while.

A. Many current leases will not contain the Redbridge waiver language.


Many current leases will not contain the Redbridge waiver language.

I looked at the last three commercial landlord and tenant litigations that I worked on. Those concerned the following types of commercial leases:

  • A net lease for an entire building in Brooklyn,
  • A lease for a small office suite in a class B building in Manhattan,
  • A lease for a store in a shopping plaza in Queens,


– AND NONE OF THEM HAD REDBRIDGE WAIVER CLAUSES!!! 

B. The profession is slow to respond, so there will be a lag time before landlord-drafters are including the Redbridge waiver.


The profession is slow to respond, so there will be a lag time before landlord-drafters are including the Redbridge waiver in commercial leases.

C. When landlord-drafters attempt to include the Redbridge waiver, some tenant-drafters will successfully resist.


When landlord-drafters attempt to include the Redbridge waiver in commercial leases, some tenant-drafters will successfully resist. It will depend on whose market it is and how much bargaining power the tenant in question has.

Who knows what interesting new clauses will be negotiated? Perhaps a tenant-drafter will allow a Redbridge waiver in if the deadlines for curing a default are extended from 15 days to 45 or 60 days. 

D. Again, the profession is slow to respond, so there will be a lag time before litigators working for landlords in commercial tenant default matters know to look for Redbridge waiver language.


Again, the profession is slow to respond, so there will be a lag time before litigators working for landlords in commercial tenant default matters know to look for Redbridge waiver language. If landlord’s counsel does not know to look for the Redbridge waiver, then she will not raise it and thwart a Yellowstone injunction.

E. Inevitably, there will be disputes about whether lease language, which is not the specific language dealt with by the Court of Appeals in Redbridge, gives rise to the same waiver.


Inevitably, there will be disputes about whether lease language, which is not the specific language dealt with by the Court of Appeals in Redbridge, gives rise to the same waiver. That should be fun.

F. Ultimately, as Redbridge does reduce the number of Yellowstone applications, these cases will be hashed out more frequently in the commercial landlord and tenant part of the NYC Civil Court and the world will continue to spin on its axis.


Ultimately, as Redbridge does reduce the number of Yellowstone applications, these cases will be hashed out more frequently in the commercial landlord and tenant part of the NYC Civil Court.

The world will continue to spin on its axis.

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