Tenant Issues: Attorneys Fees, Late Fees, And The Warranty of Habitability

I do not regularly practice landlord-tenant law, and I would strongly recommend that anyone faced with a serious landlord-tenant issue find an attorney who practices in this area. If you are facing eviction, and have limited income, NYC Legal Services and Nassau/Suffolk Law Services may be able to help.

The landlord-tenant relationship is easily susceptible to over-reaching, and the purpose of this post is to help tenants understand their legal rights. Just as people hope that wealth will trickle-down in a good economy, you can be sure that financial burden and debt will pour down upon those who are least able to handle it in a bad economy.

Every landlord-tenant court is different, and the City courts have a reputation for being tenant-friendly. In suburban communities, however, you will more than likely be faced with a small-town judge, before whom the same attorneys, representing the same landlords, constantly appear. I do not mean to imply that these courts are bias or corrupt, but the local landlord tenant court is undeniably the landlord's home-turf.

Below is a discussion of three frequently occurring issues in landlord-tenant cases: attorneys fees, late fees, and the warranty of habitability. 

ATTORNEYS FEES

In a landlord-tenant proceeding, regardless of the terms of the lease, only the prevailing party is entitled to costs and attorneys fees. To be considered the “prevailing party,” a party must be successful “with respect to the central relief sought.” Babylon Village Equities v. Mitchell, 11 Misc 3d 84, 816 NYS2d 279 (App Term 2nd Dep't 2006).

One tactic that is often used by landlords with in-house attorneys is to quickly bring eviction actions, then discontinue them based upon partial pament, and charge the tenant a court cost or attorneys fee on their next bill. This practice is extremely profitable for the landlord, but makes it much more difficult for the tenant to catch-up on rent.

This practice is improper, and you may be entitled to a refund of those fees or a set-off against the amount the landlord is claiming against you. Babylon Village Equities v. Mitchell, 11 Misc.3d 84, 816 N.Y.S.2d 279 (App. Term., 2d Dept., 2006); ATM Four LLC v. Demezier, 2 Misc.3d 1132(A), 2009 N.Y. Slip Op. 50406(U) (Nassau County, 1st Dist., March 6, 2009); Clinton Realty, LLC v. Tarra, 15 Misc.3d 1118(A), 839 N.Y.S.2d 432 (Nassau County Dist. Ct., 2007)(Finding that Petitioner is not entitled to court costs and attorneys fees where tenant voluntarily pays back rent). The catch, however, is that an improper fee, by itself, will not stop an eviction if some rent is legitimately owed; if you are behind, they have a right to evict you.

LATE FEES

Often landlords will charge a late fee equal to a percentage of a months rent, sometimes 10% or more. Unreasonable fees, however, violate public policy. As one court explained:

The underlying issue is the enforceability of a rent surcharge of 5% per month… the charge, while not technically interest, is at the rate of 60% a year. Examined in the light of the public policy expressed in section 190.40 of the Penal Law, which makes an interest charge of more than 25% a criminal offense, we find the charge unreasonable and confiscatory in nature and therefore unenforceable.

943 Lexington Avenue, Inc. v Niarchos, 83 Misc 2d 803, 373 NYS2d 787 (App. Term. 1st Dept. 1975). See also Dashnaw v. Shiflett, 10 Misc. 3d 1051A (App Term 1st Dept. 2005)($5 per day on $475 rent, totalling 26.3%, held unconscionable).

THE WARRANTY OF HABITABILITY

The warranty of habitability, basically, means that your landlord needs to provide decent living conditions. Issues such as a lack of heat, hot water, or mold can give rise to a claim under the breach of the warranty of habitability, which may result in a rent abatement. You need to prove that the issue makes your apartment, essentially, unliveable, and that you have given the landlord notice of the problem and an opportunity to correct it.

There are three guarantees within the warranty of habitability, which are that the premises: (1) is not dangerous to life, health or safety; (2) is habitable and usable; and (3) is in accord with reasonable expectations of the parties. Solow v. Wellner, 6 N.Y.2d 582, 635 N.Y.S.2d 132 (1995) citing Park West Management Corp. v. Mitchell, 47 N.Y.2d 316, 418 N.Y.S.2d 310 (1979). See also Tavarez v. Wearn, 2005 NY Slip Op 51236U, 4, 8 Misc. 3d 1022A, 803 N.Y.S.2d 21 (Kings County Civ. Ct. 2005).