The enactment of the Housing Stability and Tenant Protection Act of 2019 (HSTPA) has created considerable turmoil and uncertainty in the real-estate industry in New York. Although perhaps not intended to be impacted by this sweeping legislation, co-ops are undeniably bound by its provisions, and are legally prohibited from collecting “additional rent” charges—such as late fees, attorney fees, sublet fees, and the like—in summary nonpayment proceedings in Housing Court.
To address those recent developments, some practitioners have recommended alternative methods for collecting maintenance arrears charges from cooperative shareholders through the use of UCC Article 9 nonjudicial foreclosures, at least with respect to owner-occupied units. See, e.g., “A Tool for Co-op Boards to Collect Arrears and Legal Fees.” Habitat, Jan. 28, 2020. But nonjudicial foreclosure is not the answer. It is legally untenable and could subject co-op boards who employ that method to severe legal and financial consequences.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]