CLIENT ALERT: Updates on Tenant Protections Relating to the Disaster EmergencyBy: Jared R. Mack, Esq.

On May 7, 2020 Governor Cuomo issued Executive Order 202.28 extending Executive Orders 202 through 202.14 through June 6, 2020. Accordingly, unless otherwise noted, all orders issued before April 7, 2020 have been extended through June 6, 2020. 

Executive Order 202.28 includes provisions that will have a statewide impact on landlords and tenants.  These provisions include limitations on residential and commercial evictions for non-payment proceedings through August 20, 2020; a prohibition on charges for late fees between March 20, 2020 and August 20, 2020; and a process by which tenants that have been financially affected by COVID-19 can apply their security deposits to unpaid rent balances and replenish the deposit over the course of a twelve-month period.  A general outline of the revised order provisions is included below. 

LIMITATION ON SUMMARY PROCEEDINGS AND FORECLOSURES:

Pursuant to Executive Order 202.28, there shall be no initiation of a proceeding or enforcement of either an eviction of any residential or commercial tenant, for nonpayment of rent or a foreclosure of any residential or commercial mortgage, for nonpayment of such mortgage, owned or rented by someone that is eligible for unemployment insurance or benefits under state or federal law or otherwise facing financial hardship due to the COVID-19 pandemic for a period of sixty days beginning on June 20, 2020.

?LIMITATION ON THE COLLECTION OF LATE FEES OR OTHER CHARGES:

• Subdivision 2 of section 238-a of the Real Property Law was temporarily revised to provide that no landlord, lessor, sub-lessor or grantor shall demand or be entitled to any payment, fee or charge for late payment of rent occurring during the time period from March 20, 2020, through August 20, 2020. 

APPLICATION OF SECURITY DEPOSITS TO RENT

PAYMENTS UPON TENANT’S REQUEST:

• Sections 7-103, 7-107 and 7-108 of the General Obligations Law was temporarily revised to the extent necessary to provide that:  

• Landlords and tenants or licensees of residential properties may, upon the consent of the tenant or licensee, enter into a written agreement by which the security deposit and any interest accrued thereof, shall be used to pay rent that is in arrears or will become due. If the amount of the deposit represents less than a full month rent payment, this consent does not constitute a waiver of the remaining rent due and owing for that month.  Execution in counterpart by email will constitute sufficient execution for consent;
• Landlords shall provide such relief to tenants or licensees who so request it that are eligible for unemployment insurance or benefits under state or federal law or are otherwise facing financial hardship due to the COVID-19 pandemic;
• It shall be at the tenant or licensee’s option to enter into such an agreement and landlords shall not harass, threaten or engage in any harmful act to compel such agreement;
• Any security deposit used as a payment of rent shall be replenished by the tenant or licensee, to be paid at the rate of 1/12 the amount used as rent per month. The payments to replenish the security deposit shall become due and owing no less than 90 days from the date of the usage of the security deposit as rent. The tenant or licensee may, at their sole option, retain insurance that provides relief for the landlord in lieu of the monthly security deposit replenishment, which the landlord, must accept such insurance as replenishment.

• A link to the full text of the Executive Order can be found below: https://www.governor.ny.gov/news/no-20228-continuing-temporary-suspension-and-modification-laws-relating-disaster-emergency

*The Attorneys at Levene Gouldin & Thompson, LLP are available to provide advice and counsel concerning these new statutory obligations and other matters related to COVID-19.