Coronavirus in Your Multi-Family / Commercial Building

If you learn that someone is infected with Coronavirus in a unit, do not notify other tenants or conduct cleaning.

Instead, contact your local (County / City) and follow their guidance. Do nothing else.

You are ill-equipped to create a protocol and may further injure your tenants by acting imprudently.

There are privacy concerns, cleanliness concerns, isolation concerns, testing concerns and the like.

Therefore, if you learn of a positive diagnosis in your property, contact your local health department and follow their guidance.

Federal Courts Remain Open Amid the Coronavirus Outbreak

While New York State Courts are currently not permitting individuals or businesses to commence new matters (with extremely limited exceptions), federal courts (Eastern District of New York and Southern District of New York) remain open. Individuals or businesses can, thus, still file new cases in federal court.

Potential causes of action that can be filed in federal court include, but are not limited to:

• Wage and Hour claims pursuant to the Fair Labor Standards act for unpaid wages, overtime, etc.;
• Bankruptcy petitions; 
• Discrimination/Retaliation claims under Title VII (race, age, sex, religion, disability etc.);
• Interference with rights under the Family Medical Leave Act.

NYS Mortgage Relief Plan – Guidance from DFS

Following Governor Cuomo’s announcement on a 90-day mortgage relief plan for borrowers affected by the novel coronavirus (COVID-19), the New York State Department of Financial Services (DFS) issued Guidance to regulated financial institutions concerning its implementation. The Guidance urges all regulated financial institutions to do their part in curtailing the effects of COVID-19 on consumers and small businesses by:

• Waiving overdraft fees;
• Providing new loans on favorable terms;
• Waiving late fees for credit card and other loan balances;
• Waiving automated teller machine (ATM) fees;
• Increasing ATM daily cash withdrawal limits;
• Waiving early withdrawal penalties on time deposits;
• Increasing credit card limits for creditworthy customers;
• Offering payment accommodations, such as allowing loan customers to defer payments at no cost, extending the payment due dates or otherwise adjusting or altering terms of existing loans, which would avoid delinquencies, triggering events of default or similar adverse consequences, and negative credit agency reporting caused by COVID-19 related disruptions;
• Ensuring that consumers and small businesses do not experience a disruption of service if financial institutions close their offices, including making available other avenues for consumers and businesses to continue to manage their accounts and to make inquiries;
• Alerting customers to the heightened risk of scams and price gouging during the COVID-19 disruptions, and reminding customers to contact their financial institutions before entering into unsolicited financial assistance programs; and
• Proactively reaching out to customers via app announcements, text, email or otherwise to explain the above-listed assistance being offered to customers.

Regulated financial institutions are also urged “to work with and provide accommodations to their borrowers during this unprecedented global emergency to the extent reasonable and prudent.” This includes holding off on taking adverse action for defaults. Regulated financial institutions include mortgage bankers, mortgage loan servicers, banks and trust companies, among others. For a full list of DFS-regulated financial institutions, click HERE.

While the efforts of DFS and New York State are definitely acknowledged and appreciated, Borrowers should be aware that the Guidance is simply that, guidance. The Guidance does not legally require financial institutions to take the above-listed actions and only encourages them to do so.

Stay tuned for more updates from New York State and DFS as to specific procedures on the NYS mortgage relief plan.

County Clerks and Court Clerks Forbidden From Accepting Filings

The Chief Administrative Judge of the Courts has issued an order forbidding the filing of all non-essential papers in county clerks and court clerks. This order is statewide and will have far-reaching consequences.

The Order, a copy of which can be found HERE, states:

Pursuant to the authority vested in me, in light of the emergency circumstances caused by the continuing COVID-19 outbreak in New York State and the nation, and consistent with the Governor of New York's recent executive order suspending statues of limitation in legal matters, I direct that, effective immediately and until further order, no papers shall be accepted for filing by a county clerk or a court in any matter of a type not included on the list of essential matters attached as Exh. A. This directive applies to both paper and electronic filings.

Follow the link above to find a list of essential matters, most of which focus on the protection of the life, safety, and well-being of people.

The consequences of this Order are profound. For example, the Suffolk County and Nassau County clerks were both operating on a limited basis, but were still operating. The State's electronic court filing system was still accepting filings which enabled parties to continue litigating so long as it didn't require judicial intervention. New York County's online recording system, ACRIS, was still accepting electronic filings. Based on the wording of this Order, all of that ends today.

Despite this Order, Lieb at Law will proceed with our litigation matters to the maximum extent possible - as long as it doesn't require judicial intervention, we will push forward.

Look for a blog from Steven Siliato later today detailing the effects this Order will have on real estate transactions. Title examination? Race notice recording? GAP title insurance?

Governor Cuomo Issues Statewide Moratorium on Commercial and Residential Evictions and Foreclosures

Governor Cuomo has consolidated the patchwork of local foreclosure and eviction laws bubbling up in the wake of the COVID-19 quarantines - and it's a big one.

Executive Order 202.8 states:

There shall be no enforcement of either an an eviction of any tenant, residential or commercial, or a foreclosure of any residential or commercial property for a period of ninety days. 

Ninety days from the date of the Order puts us out to June 18, 2020.

One noteworthy aspect of this Order is its application to both residential and commercial properties. 

It is vital to note, however, that this does not mean you cannot be in default of your rent or mortgage for the ninety day period. It simply states that there shall be no enforcement of evictions or foreclosures. If you are delinquent on your rent or mortgage during the term of this order, your landlord or lender could commence an eviction or foreclosure proceeding after the order expires. 

The interplay of this Executive Order with Executive Order 202.9 (see our prior blog about that, here) creates an opportunity for borrowers to leverage a forbearance with their lender ensuring that they are not delinquent on their mortgage on June 18, 2020.