Real Estate Weekly
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Non-payment proceedings a need-to-know business

By Martin Meltzer, partner, BBWG

Often, clients ask us to start non-payment proceedings against tenants who reside in apartments subject to rent stabilization, or apartments that have been deregulated, after a lease has expired or a tenant has not returned a signed renewal lease offer.

Photo by Brian Turner
Photo by Brian Turner

In these instances, tenants have remained in possession even though there is no signed lease. Often in these situations the tenants have also not paid rent.

In such circumstances, it is important to be able to gather the facts and analyze what type of case to bring for the owner.

Appellate case law allows for an owner to bring a non-payment case against a tenant who resides in a rent stabilized unit or deregulated unit after the lease has expired.

There are court decisions from the 1980’s that say otherwise, but the current law allows for the non-payment proceeding to be brought.

The owner is allowed to also bring a holdover as; a lease expiration holdover; a month-to-month holdover; or failure to renew lease holdover, depending on the circumstances.

With a lease expiration holdover in a deregulated apartment where the tenant has not paid rent after the lease expiration date, the owner is permitted to bring the case by filing a holdover petition.  No predicate notice is required.

A month-to month holdover situation with a deregulated apartment arises when an owner, after the expiration of the lease, accepts money from the tenant for the period after the lease expires. In this circumstance, the owner must serve a predicate notice called a 30-day notice of termination.

In the third scenario, a failure to renew holdover, with a rent stabilized unit where the owner has timely offered a renewal lease to the tenant and the tenant has not returned the renewal lease to the owner within the 60-day required time allotment, the owner is required to serve a predicate 15-day notice of termination.

After its expiration a holdover petition is filed with the court.

It is important to gather the facts before an owner decides whether to bring a nonpayment or holdover proceeding.

If you have a situation where a tenant’s lease has expired and/or owes rent, it is suggested to speak with your attorney to determine what the best, most practical, efficient and cost effective course of action is.

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