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Damage Mitigation Question

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Damage Mitigation Question

Postby former_ues_tenant » Fri Nov 13, 2020 2:53 pm

Hello,

I have a similar situation to NYC_former_tenant: viewtopic.php?f=1&t=14190

Due to family reasons, we had to move out of our UES 2br earlier this year. We have already surrendered possession to the LL and have been dutifully paying our rent (despite not living there) for the past 3 months. We also agreed to pay a part of the broker's fee and any difference in rent until the end of our lease (May 2021).

However, it has come to our attention that our LL has received 3 offers on the unit, though he has rejected all of them on the basis that the offers presented are too low (which is understandable given that we are in covid-season). I understand that he is supposed to mitigate damages on a best efforts basis, so is he allowed to do this by arguing that the offers were below "fair market price"? How should we think about this situation? Thanks in advance.
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Re: Damage Mitigation Question

Postby TenantNet » Fri Nov 13, 2020 5:00 pm

I don't think there is any law that requires payment of the broker's fee, however I do remember some discussion of limitations on brokers. See the small print of your lease.

The laws changed in 2019 that requires a LL to seek to mitigate any losses due to a tenant moving out. That means he has to show he made a good-faith attempt to re-rent the unit at the same or higher rent. It's possible you might not owe any rent after the move-out date.
Are the offers below what you were paying?

According to Judge Lebovits' summary, prior to 2019:

Landlords were not obligated to mitigate damages. The apartment could have been left vacant, and the tenant would have been liable for rent through the end of the term.


But with the 2019 law:

- Landlord must in good faith, according to landlord's resources and abilities, take "reasonable and customary" steps to rent the apartment; residential only.

- Overrules Holy Props Ltd, L. P. v. Kenneth Cole Productions

- Lease provisions to the contrary are void as contrary to public policy

- The person seeking damages has the burden of proof


- effective 6/14/19
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Re: Damage Mitigation Question

Postby former_ues_tenant » Fri Nov 13, 2020 5:10 pm

Hello,

Thank you so much for your time and response.

The LL has made an effort to lease out the unit (as evidenced by the fact there were offers). The incoming offers have been below what we are paying (about 25-30% lower), which I believe are reasonable given the current Covid situation.
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Re: Damage Mitigation Question

Postby TenantNet » Fri Nov 13, 2020 5:25 pm

How an you prove there were offers?
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Re: Damage Mitigation Question

Postby former_ues_tenant » Fri Nov 13, 2020 5:27 pm

The LL told me himself that he rejected three offers as they were priced too low, including the details of one of them.
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Re: Damage Mitigation Question

Postby TenantNet » Fri Nov 13, 2020 9:54 pm

Next time use your cel phone and get him on record (of course surreptitiously). Absent that, I don't know if it would be admissible (or even matter) in any litigation. But it's worth having the proof.

That scenario would involve you stopping any payments and having him take you to court. While the courts are still essentially closed except in a few cases, while it may take time until COVID is gone, Cuomo's court moratorium is really for tenants in place and does not stop a landlord getting a money judgment against a former tenant.

The other thing you can do is negotiate to an agreement better for you. Again, I don't know without some research if broker fees must be paid, or are limited (if might matter when the broker agreement was made). Is there a separate contract for the broker? And, if the broker is essentially a relative or associate of the landlord, I would say nothing would be due. Brokers are supposed to be independent agents.

I would also consider in any negotiation allowing only the difference between the highest of the low offers for the unit (did he tell you what was offered?) and your rent. If your rent is $3,000 and and the highest offer made so far is $2,000, then you could offer $1,000, the difference. This is for negotiation only, but might be worth pursuing.

You didn't say if you are rent regulated, or not. I am assuming not. I would get your rent history from DHCR. They might balk as you are not living there, but actually since you are paying rent, you are still the legal tenant and have the right to make use of the mail box. DHCR might send it to your current location if you send to them the last copy of the lease for the unit with your name on it.

Look at the history carefully to see if there are any irregularities or big jumps in rent. They might have been illegal increases and if the unit is deregulated, there might be cause to open a case with DHCR to void the deregulation (and the overcharges for the last four years) might mean the LL owes you money.

If the LL is a small LL, just looking into the possibility of fraud might get them to renegotiate. If a larger LL who does a lot of litigation, their attorneys might not care if you challenge the rent.

I would also look at
https://www.brickunderground.com/blog/2 ... lease_2014
https://www.brickunderground.com/blog/2 ... that_lease
https://www.brickunderground.com/blog/2 ... ak_a_lease
https://www.brickunderground.com/rent/h ... k-my-lease
https://www.brickunderground.com/blog/2 ... lease_2014
https://www.brickunderground.com/blog/2 ... provisions
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Re: Damage Mitigation Question

Postby former_ues_tenant » Sun Nov 15, 2020 10:22 am

Thank you so much for your help - we will probably retain an attorney and go from there, but your insights are tremendously helpful.
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