BILL NUMBER: S2014

SPONSOR: JACKSON
 
TITLE OF BILL:

An act to amend the administrative code of the city of New York, the
emergency tenant protection act of nineteen seventy-four, the emergency
housing rent control law and the real property law, in relation to
prohibiting charges for legal fees

 
PURPOSE:

This bill would prohibit a landlord from including any legal fees not
awarded pursuant to a court order on any correspondence to a tenant.

 
SUMMARY OF PROVISIONS:

Section 1 amends the Administrative Code of the City of New York by
adding Section 26-416 that would prohibit an owner, lessor or agent from
assessing a lessee any fee, surcharge, or other charges for legal
services in connection with the operation or rental of a residential
              

unit unless the owner, lessor or agent has the legal authority to do so
pursuant to a court order. Legal services include, but are not limited
to, court fees, legal representation, attorney fees, notary public
charges, and administrative fees incurred by the owner, lessor or agent
in connection with management of the building, including actions and
proceedings in a court of law. Any agreement or assessment to the
contrary shall be void as contrary to public policy.

Section 2 amends Section 6 of Section 4 of Chapter 576 of the Laws of
1974, constituting the Emergency Tenant Protection Act of 1974 by adding
a new subdivision f-1 that would prohibit an owner, lessor or agent from
assessing a lessee any fee, surcharge, or other charges for legal
services in connection with the operation or rental of a residential
unit unless the owner, lessor or agent has the legal authority to do so
pursuant to a court order. Legal services include, but are not limited
to, court fees, legal representation, attorney fees, notary public
charges, and administrative fees incurred by the owner, lessor or agent
in connection with management of the building, including actions and
proceedings in a court of law. Any agreement or assessment to the
contrary shall be void as contrary to public policy.

Section 3 amends Section 26-512 of the Administrative Code of the city
of New York by adding a new subdivision g that would prohibit an owner,
lessor or agent from assessing a lessee any fee, surcharge, or other
charges for legal services in connection with the operation or rental of
a residential unit unless the owner, lessor or agent has the legal
authority to do so pursuant to a court order. Legal services include,
but are not limited to, court fees, legal representation, attorney fees,
notary public charges, and administrative fees incurred by the owner,
lessor or agent in connection with management of the building, including
actions and proceedings in a court of law. Any agreement or assessment
to the contrary shall be void as contrary to public policy.

Section 4 amends subdivision 4 of Section 4 of Chapter 274 of the Laws
of 1946, constituting the emergency housing rent control law that would
prohibit an owner, lessor or agent from assessing a lessee any fee,
surcharge, or other charges for legal services in connection with the
operation or rental of a residential unit unless the owner, lessor or
agent has the legal authority to do so pursuant to a court order. Legal
services include, but are not limited to, court fees, legal represen-
tation, attorney fees, notary public charges, and administrative fees
incurred by the owner, lessor or agent in connection with management of
the building, including actions and proceedings in a court of law. Any
agreement or assessment to the contrary shall be void as contrary to
public policy.

Section 5 amends the Real Property Law by adding a new Section 234-A
that would prohibit an owner, lessor or agent thereof from charging or
including any fee, surcharge, or other charges for legal services in
connection with the operation or rental of a residential unit unless the
owner, lessor or agent has the legal authority to do so pursuant to a
court order. Legal services include, but are not limited to, court fees,
legal representation, attorney fees, notary public charges, and adminis-
trative fees incurred by the owner, lessor or agent in connection with
management of the building, including actions and proceedings in a court
of law. Any agreement or assessment to the contrary shall be void as
contrary to public policy.

Section 6 sets the effective date.

 
JUSTIFICATION:

Nearly half of all New Yorkers live below or close to the poverty line.
Accordingly, it is critical that New York City has protections in place
to safeguard its residents' basic necessities, one of the most important
of which is housing. With an average rent of over $51,000 in the City of
New York, programs that reduce the rent burden are essential. One impor-
tant example is New York City's system of rent control and rent stabili-
zation, which provides a variety of tenant protections to over 2 million
people.

Despite the high need for these tenant protections, many landlords are
increasing the cost of housing, by imposing non-rent fees on rent stabi-
lized tenants. One major example, and the focus of this bill, is a fee
or surcharge for legal services. Landlords do not have legal authority
to impose a legal fee unless: a) the tenant's lease has a clause that
allows the landlord to seek such fees; b) the tenant is sued by the
landlord in a court and; c) either a judge has ordered a tenant to pay
the legal fees or the tenant has agreed to pay the fee in a court
approved agreement.

Most of the time, landlords add these surcharges without meeting any of
the above conditions. A recent survey of rent-stabilized tenants indi-
cates that 56% were charged a legal fee in the last year and on average,
the fee exceeded $1,000. Many tenants feel forced to pay these fees
because they fear eviction. This bill is necessary to protect low-income
tenants in New York City and ensure that they are not being charged more
than they legally owe for rent. This extra cost raises rents and makes
rent controlled and rent stabilized apartments unaffordable for many New
Yorkers.

 
LEGISLATIVE HISTORY:

2019-2020: A.2623-A - Referred to Codes/S.3358-A - Referred to Housing,
Construction and Community Development

2017-2018: A.1089 - Referred to Codes/S.2377 - Referred to Housing,
Construction, and Community Development

2015-2016: A.1156-A - Third Reading Rules Calendar No. 262/S.3591-A -
Referred to Judiciary

2013-2014: A.8262-A - Referred to Rules/S.6113-B - Referred to Judiciary

 
STATE AND LOCAL FISCAL IMPLICATIONS:

None to the State.

 
EFFECTIVE DATE:
This act shall take effect immediately; provided that: (a) section
26-416 of the city rent and rehabilitation law as added by section one
of this act shall remain in full force and effect only as long as the
public emergency requiring the regulation and control of residential
rents and evictions continues, as provided in subdivision 3 of section 1
of the local emergency housing rent control act; and (b) the amendments
to section 26-512 of chapter 4 of title 26 of the administrative code of
the city of New York, made by section three of this act shall expire on
the same date as such law expires and shall not affect the expiration of
such law as provided under section 26-520 of such law.