Tenants are disregarding their lease obligations and finding strength in the eviction moratoriums. What is a landlord to do? Andrew Lieb, Esq. shares tips in this article published in Behind The Hedges.
Showing posts with label #listentolieb. Show all posts
Showing posts with label #listentolieb. Show all posts
Tuesday, September 01, 2020
Wednesday, August 26, 2020
The US Department of Labor's Wage and Hour Division recently issued "guidance regarding employers’ obligation under the Fair Labor Standards Act (FLSA or Act) to track the number of hours of compensable work performed by employees who are teleworking or otherwise working remotely away from any worksite or premises controlled by their employers" that is a must read by employers / HR professionals.
We addressed this issue on the Lieb Cast on 8/2/2020's segment 3 at the 9 minute mark well before the guidance was ever issued as this advice was a no brainer for a quality employment attorney like Mordy Yankovich.
We advise you now that Fair Labor Standards Act lawsuits are coming.
Are you prepared?
To get prepared, you need to immediately establish "a reasonable process for an employee to report uncompensated work time."
Tuesday, August 25, 2020
A must read for all employers, both public and private, is the US Equal Employment Opportunity Commission's publication "What You Should Know About COVID-19 and the ADA, the Rehabilitation Act, and Other EEO Laws."
In plain English, if you have an employee with a pre-existing disability that either "puts her at greater risk during this pandemic" or, if such disability will be "exacerbated by the pandemic," and such employee requests a reasonable accommodation, then, you better either grant that request or engage in the "interactive process" to avoid getting sued.
Be warned - the lawsuits are coming.
Monday, August 24, 2020
On Sunday, 8/23/20, between 12pm and 1pm on WRCN 103.9FM, LIEBCAST aired an hour episode on Homeless Housing.
The conversation was inspired by the Facebook Group - Upper West Siders for Safer Streets. With well over 11k members in under a month - this group was formed in response to rising crime and safety concerns after 3 luxury hotels in the neighborhood were converted into homeless shelters.
We start the episode with a conversation on ethics and we breakdown how successful businesses succeed with ethical discretion in the context of contractual obligations and the law.
We thereafter bring on a representative from the Facebook Group - Upper West Siders for Safer Streets.
Then, we go deep into the following topics:
- Real estate value losses / underwater real estate
- How a hotel can become a homeless shelter
- Unraveling whether homeless people are more likely to be drug users, sex offenders, substance abusers and mentally unstable
- The De Blasio Administration
- Safety, Crime and Police Action in NYC
- Where to relocate homeless people
And finally, we reached out to the NYC Department of Health Services / Homeless Services and share their response.
The show was broken out into 4 podcasts without commercials. Below are the links:
Thursday, August 13, 2020
The Federal Courts, in the Southern District of New York, awarded $125,000 to each individual who was denied cosmetic surgery due to their HIV-Positive status in interesting discrimination case.
The case was brought under Title III of the Americans with Disabilities Act of 1990 (ADA) and the New York City Human Rights Law.
The penalty was based upon the HIV-Positive individuals' traumatic experiences, resulting in significant feelings of humiliation, shock, and worthlessness, as well as anxiety, stress, sleeplessness, and feelings of stigma and humiliation.
Again, $125,000 was awarded to each victim of discrimination who experienced emotional distress.
What do you think the award should have been?
- Nothing
- $20,000
- $125,000
- $1,000,000
Tuesday, August 11, 2020
On August 11, 2020, NYS passed a law that clarifies "that reasonable accommodation to enable a person with a disability to use and enjoy a dwelling includes the use of an animal to alleviate the symptoms or effects of a disability."
This codification exists at Executive Law 296(2-a)(d)(2) and (18)(2) and explicitly states that refusing "to make reasonable accommodations in rules, policies, practices, or services, when such accommodations may be necessary to afford a person with a disability equal opportunity to use and enjoy a dwelling, INCLUDING THE USE OF AN ANIMAL AS A REASONABLE ACCOMMODATION TO ALLEVIATE SYMPTOMS OR EFFECTS OF A DISABILITY, AND including reasonable modification to common use portions of the dwelling."
This new law is effective immediately.
If you'd like to learn more about service animals, therapy animals, emotional support animals, comfort animals and discrimination lawsuits, read my article in the American Bar Association's Section of Litigation - The Intersection of Pet Policies and Anti-Discrimination Laws in Real Estate.
Thursday, August 06, 2020
The Appellate Division recently reminded us of the importance of investigating a no consideration deed prior to issuing a mortgage to the titleholder.
In 2386 Hempstead, Inc. v. 182 St., Inc., the Appellate Division held that the no consideration deed constituted notice of a potential previous fraud in the title spurring a duty to make inquiry concerning the circumstances of the transaction at issue.
By failing to make such inquiry, the lender lost its status as a bona fide encumbrancer for value and therefore, jeopardized its status as a prior lienholder, who gets paid first in a foreclosure action.
The Appellate Division recently reminded us how the courts make a boundary line dispute determination in the case of Old Timers Rod & Gun Club, Inc. v. Wa-A-We Rod and gun Club, Inc. with the following quote:
Where such discrepancies exist in property descriptions, ‘the rules of construction require that resort be had first to natural objects, second to artificial objects, third to adjacent boundaries, fourth to courses and distances and last to quantity’
We are therefore reminded of the importance of locating monuments referenced in a deed rather than simply relying on compass bearings and distances when resolving boundary line disputes.
I want it; I want it; I want it is not a good enough argument said the Appellate Division in Irma Straus Realty Corp. v. Old Republic National Title Insurance Company.
Underlying the demand for action was a dispute between neighbors over use of a common stairwell. Plaintiff sued their insurer demanding that the title company pay attorneys' fees and costs to prosecute an ownership action against the neighbor.
Plaintiff's suit was pursuant to section 5 (b) of its policy, which provides that the title insurer “shall have the right ... to institute and prosecute any action or proceeding or to do any other act that in its opinion may be necessary or desirable to establish the Title, as insured, or to prevent or reduce loss or damage to the Insured."
Clearly, as the court points out, Plaintiff didn't understand the difference between the terms "right," which the policy stated, and "obligation," which the policy didn't state.
That is to say, the Plaintiff lost the case.
Clearly, words matter.
Tuesday, July 21, 2020
The moratorium on foreclosures expires on August 20th (EO 202.28) and a foreclosure tsunami is coming.
According to CNBC, "32% of U.S. households missed their July housing payments" based on a survey by Apartment List, which also advises that 17% of "homeowners [are] concerned about foreclosure."
To prepare for the tsunami, we are giving you our 10-Point Inspection Checklist to evaluate a foreclosure case. Whether we are representing the lender or the borrower, we utilize this list to evaluate the strength of the case, which, when coupled with an evaluation of the borrower's current mortgage terms (i.e., L/V ratio front end/back end, interest rate, principal, interest to date, penalties, attorneys' fees, months of missed payments, prior modifications/forbearances, etc.) is how we assess whether a modification, or other workout, should be considered.
10 Point Inspection Checklist:
In our upcoming Real Estate Investing shows, WRCN / FM 103.9 / Sundays at Noon, we will be breaking down this list into plain English and showing you how to litigate foreclosure cases whether you are the lender or the borrower.
According to CNBC, "32% of U.S. households missed their July housing payments" based on a survey by Apartment List, which also advises that 17% of "homeowners [are] concerned about foreclosure."
To prepare for the tsunami, we are giving you our 10-Point Inspection Checklist to evaluate a foreclosure case. Whether we are representing the lender or the borrower, we utilize this list to evaluate the strength of the case, which, when coupled with an evaluation of the borrower's current mortgage terms (i.e., L/V ratio front end/back end, interest rate, principal, interest to date, penalties, attorneys' fees, months of missed payments, prior modifications/forbearances, etc.) is how we assess whether a modification, or other workout, should be considered.
10 Point Inspection Checklist:
- Standing of plaintiff (owner / holder of note on date of commencement or authorized agent of such owner / holder pursuant to Pooling and Servicing Agreement or other agreement)
- Record admissibility (swearing to business records of another entity; failure to attach business records to affidavits)
- RPAPL 1303 / 1304 / 1305 / 1306 compliance
- Acceleration / Deacceleration (statute of limitations)
- Notices tendered in satisfaction of note terms
- Lis Pendens filing
- Payment history for default calculations / date (requisite missed months for default requirement in note / aligned with notices / statute of limitations)
- Default on Answer with time since settlement conference for late answer availability
- Service / personal jurisdiction issues
- Pleadings requirements (Certificate of Merit - CPLR 3012-B, RPAPL 1302)
In our upcoming Real Estate Investing shows, WRCN / FM 103.9 / Sundays at Noon, we will be breaking down this list into plain English and showing you how to litigate foreclosure cases whether you are the lender or the borrower.
Tuesday, June 30, 2020
If you are a NYS landlord, you MUST read the decision from the case Elmsford Apartment Associates LLC v. Cuomo if you want to be on the top of your game.
We aren't going to discuss the results, beyond saying the Court ruled that Governor Cuomo can legally suspend evictions and more during a pandemic.
We focus on these other gems given to us by the Court - Every property investor (landlord, property manager, broker, flipper, etc.) should read and accept this reality before getting into the investment game:
This hasn't diminished our motivation to invest in real estate, but as the Court makes clear - we respect the rules and adjust our prices / reserves to account for more rules in the future.
Some years there are less rules and other years there are more, but we know that a keen understanding of the rules will make us profitable as property investors.
If you want profitability too, you need to increase your compliance budget immediately and respect the rules of the game because, as you can see, fighting the governor's office is a losing battle.
We aren't going to discuss the results, beyond saying the Court ruled that Governor Cuomo can legally suspend evictions and more during a pandemic.
We focus on these other gems given to us by the Court - Every property investor (landlord, property manager, broker, flipper, etc.) should read and accept this reality before getting into the investment game:
Evicting a tenant – especially a residential tenant – in New York is a slow, cumbersome and extremely tenant-favorable process, especially when compared to analogous procedures in other states.
Governor Cuomo did nothing to impede the commencement of holdover proceedings… Nor does EO 202.28 suspend[] the landlords’ right to initiate a common law breach of contract action in the New York State Supreme Court to redress a tenant’s failure to perform its payment obligations under his or her lease.
Tenants will continue to accrue arrearages, which the landlord will be able to collect with interest once the Order has expired.
One who chooses to engage in a publicly regulated business… by so doing surrenders his right to unfettered discretion as to how to conduct same.
The expected costs of foreseeable future regulation are already presumed to be priced into the contracts formed under the prior regulation
New York landlords do not enjoy a constitutional right to realize a profit from their rental properties – let alone all the profits contemplated in each of their individual rental agreements.
If the tenant uses the security deposit to pay a month’s rent, and the tenancy ends before the deposit is fully replenished, the landlord can obtain a judgment for the amount expended in repairs.A special shout-out to the eviction explanation -
To secure an eviction warrant from the housing courts, a New York landlord must serve the tenant a notice of nonreceipt of payment, and give the tenant one final chance to pay by making a demand of payment within 14 days. If the landlord is still owed payment after two weeks have passed, he may commence what is known as a summary proceeding by filing a petition in the civil court, returnable by the tenant within 10 days. If the tenant does not respond in ten days, the court may (but rarely does) issue an eviction warrant immediately. However, if the tenant does respond, however, a trial is set for eight days hence. The trial may be adjourned up to ten additional days if the parties so require in order to produce their witnesses. If, after trial, a judgment is entered for the landlord and the court issues a warrant for eviction, the Sheriff must give the tenant 14 days’ notice in writing prior to execution. There are the usual provisions for appeal and stays issue routinely so that non-defaulting tenants are not evicted before their cases are fully reviewed. But even if the evidence supports a judgment for the landlord, the housing court is not required to order the tenant’s immediate eviction. A tenant may obtain a stay of the issuance of the warrant for up to one year by showing that ‘it would occasion extreme hardship to the tenant or the tenant’s family if the stay were not granted’. Such stays are far from uncommon.Still think that being a landlord is for you?
This hasn't diminished our motivation to invest in real estate, but as the Court makes clear - we respect the rules and adjust our prices / reserves to account for more rules in the future.
Some years there are less rules and other years there are more, but we know that a keen understanding of the rules will make us profitable as property investors.
If you want profitability too, you need to increase your compliance budget immediately and respect the rules of the game because, as you can see, fighting the governor's office is a losing battle.
Wednesday, June 24, 2020
Effective June 24, 2020, the following rules apply to
residential and commercial foreclosure proceedings as per Administrative Judge
Lawrence K. Marks memorandum
dated June 23, 2020:
Like eviction proceedings, commencement documents must be filed only by NYSCEF or by mail and commencement papers for
residential and commercial foreclosure proceedings are required to include:
- A form plaintiff’s attorney affirmation, indicating that counsel has reviewed the various state and federal restrictions and qualifications on foreclosure proceedings and believes in good faith that the proceeding is consistent with those restrictions and qualifications; and
- A form notice to defendants-tenants (in English and Spanish), informing them that they may be eligible for an extension of time to respond to the complaint in light of legal directives related to the COVID-10 pandemic, and directing them to a website link for further information.
In addition, regardless of whether an answer is filed,
further hearing of the case shall be stayed until Executive Orders suspending
deadlines for the prosecution of legal matters expire. However, the following
may proceed:
- Foreclosure matters wherein all parties are represented by counsel may be calendared for both initial and follow-up virtual settlement conferences;
- Lenders may move for a judgment of foreclosure and sale on the ground that a property is vacant and abandoned; and
- Lenders may also move to discontinue a pending case.
No motions shall be entertained or decided, except for
motions to discontinue and motions for judgments of foreclosure for vacant and
abandoned property only.
Stay tuned as Administrative Judge Lawrence K. Marks is
expected to issue further directives on foreclosures at or before the Executive
Orders suspending deadlines expire.
Tuesday, June 23, 2020
Friday, June 19, 2020
Beginning June 20, 2020, courts will accept new eviction matters – statewide eviction moratorium expires (Executive Order 202.28).
To facilitate this, the Chief Administrative Judge released a memorandum setting the procedures for residential and commercial eviction proceedings in New York State.
Now, commencement documents in eviction proceedings must be filed with the court by NYSCEF or mail. Further, until further order, petitions in commercial and residential eviction proceedings based on nonpayment of rent or on other grounds must include the following:
- Form petitioner’s attorney affirmation or petitioner’s affidavit (for self-represented petitioners), indicating that counsel / petitioner has reviewed the various state and federal restrictions and qualifications on eviction proceeding and believes in good faith that the proceeding is consistent with those restrictions and qualifications; and
- Form notice to respondent-tenants (in both English and Spanish), informing them they may be eligible for an extension of time to respond to the petition in light of legal directives related to the COVID-10 pandemic, and directing them to a telephone number and/or website link for further information.
The memorandum further stays the hearing of the eviction matter until the Executive Orders suspending statutory time periods for legal matters expire. However, eviction matters commenced on or before March 16, 2020 in which all parties are represented by counsel shall be eligible for calendaring for virtual settlement conferences.
Also, the New York State Courts Electronic Filing System (NYSCEF) will accept New York City Housing Court matters later this summer.
Tuesday, June 16, 2020
The Real Estate market has reopened and investors are everywhere. We review the legal requirements to take on investors and review calculations to make sure you are making the right decisions.
Friday, June 05, 2020
5-Step
Plan to Reopen Your Long Island Business
We
are reopening throughout Long Island!
Phase
2 is Wednesday - Are you ready to open your business?
Reopening
isn’t just going back to work – there are 5 steps that businesses must take to
open their doors if they want to avoid legal troubles.
Each industry has
tailored guidelines from NYS DOH, which represents the minimum requirements for
you to reopen.
Step
2. Formulate a business safety plan.
Each business MUST
develop a written safety plan to prevent the spread of COVID.
The plan must be retained
on the premises of the businesses and made available for inspection by DOH or
your local health and safety authorities (zoning) upon request.
The sample plan provided
by NYS is 7 pages long and includes a daily mandatory health screening
assessment for employees and essential visitors, a requirement to record a log
of all those physically present at the premises, cleaning requirements, and
much more.
Start writing your plan
now in compliance with the law if you plan to reopen.
Step
3. Create logbooks to comply and maintain policies.
You need to create forms
to implement your plan. You need the health screening assessment developed, a logbook
for cleaning, and a logbook for visitors. These can be inspected by DOH and
other authorities so they better exist before you open your doors.
Step
4. Floor markings and PPE.
You are required to
provide your entire team with PPE so it’s time to start ordering supplies
yesterday. Plus, you need to place signage and floor markings throughout your
premises to maintain proper social distancing. So, take out your tape and
measuring stick to get going.
Step
5. Craft your message.
Your team and your
customers need to understand your plan and how it impacts them, or they won’t
follow it. So, you need to create a message, start getting it out there via
email and make it available to everyone at your business. This message must explain
your safety plan and the new policies that you will enforce for the rest of
COVID. Getting buy-in is the key to proper implementation and protecting you
from suit and negative PR.
Here
is a radio clip with our employment lawyer, Mordy Yankovich,
discussing how to comply and protect your business when you are ready to reopen
– have a listen - Real
Estate Investing with Andrew Lieb 6/7/20 - Seg 3: Advice for Phase 2 Business
Owners Reopening.
Thursday, May 28, 2020
This pandemic is turning the restaurant industry upside down and creating new opportunities for restaurants to shift their businesses, adapt and innovate. From new ways of doing take out, curbside and opening up when the government allows, restaurants have unique opportunities to get creative. This week's guests includes Melissa Fleischut, the CEO of New York State Restaurant Association discussing guidance and lobbying efforts. We have Restaurateur and Executive Chef Joe DeNicola who owns 8 restaurants sharing unique ways they have changed their business model and finally we have Tora Matsuoka, strategist and owner of iconic Hamptons restaurants inspiring every entrepreneur how to finish the puzzle to their personal success.
This 1 hour show was aired on 5/24/20 on WRCN 103.9 FM. You can download the podcasts for this show at www.listentolieb.com or by clicking on the podcast links below.
Thursday, May 21, 2020
On
May 13, 2020, the NYC Council approved Int.
No. 1932-A,
which makes substantial changes to personal guaranties in commercial leases.
The bill is on the Mayor’s desk to be enacted.
The
bill’s purpose is to provide relief to NYC commercial tenants impacted by
COVID-19. It temporarily prohibits the enforcement of personal liability
provisions in commercial leases or rental agreements. It would amend the
Administrative Code of the City of New York by adding Section 22-1005 and
adding Paragraph 14 to Subdivision a of section 22-902 of the NYC Administrative
Code.
If
enacted, the bill would render guarantee provisions unenforceable against
natural persons who are not a tenant in commercial leases or other rental real
property. The law would only impact liability for the payment of rent and other
charges caused by an occurrence of default, and subject to the following conditions:
1. The tenant must satisfy at least one of the following:
a) The
tenant was required to cease serving patrons food or beverage for on-premises
consumption or to cease operation under EO 202.3;
b) The
tenant was a non-essential retail establishment subject to in-person
limitations under guidance issued by the NYS Department of Economic Development
pursuant to EO 202.6; or
c) The
tenant was required to close to members of the public under EO 202.7; and
Under
the bill, an attempt to enforce a personal liability provision that the
landlord knows or reasonably should know is unenforceable, pursuant to the
above, shall be deemed commercial tenant harassment, which could result in
compensatory and punitive damages and attorneys’ fees and court costs. See
N.Y.C. Admin. Code § 22-903.
Sounds
too good to be true for many tenants and often when it’s too good to be true,
it’s untrue. Expect this law to be challenged on constitutional grounds should
it be enacted. Specifically, the bill seems to impair the Contracts Clause of
the United States Constitution because it retroactively affects personal
guaranties entered into prior to the bill’s passing. For such a claim to
succeed, the initial inquiry under the impairment of contracts clause contains
three components:
- Whether there is a contractual relationship;
- Whether a change in law impairs that contractual relationship; and
- Whether the impairment is substantial. U.S.C.A. Const. Art. 1, § 10, cl. 1; American Economy Ins. Co. v. State, 30 N.Y.3d 136 (2017).
While
tenants will surely argue that the bill doesn’t substantially impair the
parties’ contractual relationship, as the bill only covers rent and payments
for the period of March 7, 2020 to September 30, 2020, landlords will counter
that the personal guarantee was a material term of the lease and a substantial
reason that the landlord agreed to enter into the contract.
For
analogy, the Court of Appeals has previously struck down similar government
interference in contacts. In Patterson v. Carey, the Court of Appeals
struck down a law which curtailed toll authority bondholders’ ability to
increase their tolls for Jones Beach State Parkway on constitutional grounds.
41 N.Y.2d 714 (1977).
If
the NYC bill passes, it would likely undergo similar challenges and review as
the law in Patterson and be deemed unconstitutional. The bill’s
impairment to contractual rights agreed upon by landlords and guarantors would
be substantial, especially considering that the bill does not merely delay a
landlord’s right to enforce the guarantee during the period stated in the bill,
it extinguishes it altogether.
Mayor
DeBlasio has until June 12, 2020 to either sign, veto, or do nothing. If the Mayor
signs the bill or does nothing, the bill will automatically become law. If the Mayor
vetoes the bill, it is sent back to the Council. The Council can then override
the Mayor’s veto with a 2/3 vote.
In
the meantime, both landlords and tenants should contact their attorneys to
ensure that their interests are protected and to prepare for expected lawsuits
to follow. For ideas on how to creatively resolve lease issues due to
coronavirus and for tips on important lease provisions when renegotiating,
listen to our podcasts HERE
and HERE.
Tuesday, May 19, 2020
It's time to make lemonade out of those lemons and fill up your half cup of coffee! We have the technology to run businesses remotely and Coronavirus is the motivation for everyone to use it. This means the future will involve a drastic decline in daily office commuting with a corresponding uptick in new real estate investment opportunities. Trendsetters and HGTV Stars Tom and Mickey join us to explore New York's exurban areas that are poised to explode. Plus we break down when to invest and teach you how to time the market before 2021.
Segment 1: How Changing Times Can Make You Money
Show Breakdown (click on links below in order to listen to the full show)
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