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Deemed Lease

NYC Housing Court Practice/Procedures

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Deemed Lease

Postby capitalP » Thu Dec 08, 2011 5:53 pm

I have lived in a rent stabilized apartment high rise since Sept 2008. Initially there on a 2-year lease, when it expired in August 2010, I did not file a renewal lease but paid the newly negotiated rent. I never received any notice that this had obligated me to a deemed lease (I didn't know such a thing existed at the time).

I continued to live there and in June 2011, again received a renewal lease to sign. I worked with management on negotiating the rent increase which was not agreed to until September 1, 2011 (what would be the first day of the "new" lease term - this agreement took place over email which I have saved.)

Again, I paid the new rent but did not sign or send in a renewal lease. I never received or was notified of a deemed lease. On November 15, management asked for a status of our lease since they hadn't yet received it. ON November 21, I notified management that we were planning to vacate the apartment and could provide 30-60 days notice based on what was best for them.

They aren't working with us, first proposed we pay 2 months rent as a penalty fee and when we counter offered, they've gone silent - won't answer calls or emails despite 10 attempts per day.

My understanding from speaking with tenant lawyer and DHCR is that the deemed lease is in effect once we paid the agreed rent for a renewed 1-year lease. HOWEVER, that the landlord was legally obligated to send us a copy of the completed deemed lease within 30 days of our payment. Since they didn't and still haven't explained this to us (despite our numerous requests to understand) - can someone advise me on how this might play out?

We have tried to work with them, we don't want to be evicted or break the law. We're trying to get a second bedroom and move out of manhattan for our 8 month old baby. Before we sign a lease elsewhere, I'd like to be advised on possible repercussions of giving 30-60 day notice that we're vacating and beyond that stopping payment on the apartment.

Please help!
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Postby TenantNet » Thu Dec 08, 2011 7:02 pm

Without reading the rest of it, you cannot "negotiate" a RS lease. It's illegal even if it benefits the tenant. RS renewal leases must be at a 1 or 2 year percentage increase as determined by the RGB or a DHCR or court order.

Too many tenants are naive and get themselves in trouble this way. Just stop it!

Deemed leases occur when a tenant is offered a renewal lease that is proper, i.e., right forms, right percentages, etc., fails to renew the lease and continues to live there.

If the LL did not send you a proper renewal offer and not on the DHCR form RTP-8, then they cannot impose a deemed lease. Note: some situations like 421(a) or inclusionary zoning might be different. You mentioned you lived in a RS high rise, so I suspect it's a 421(a). As I only know what you've indicated, there might be differences from the usual case.

One doesn't "break the law" with RS units. Stop thinking that way.

If you leave the question then becomes what your potential liability is, assuming the LL wants to pursue that and assuming you want to fight it, then the question becomes the deemed lease's validity.

If you've gotten legal advice from a tenant attorney that knows all the facts, then best to follow that advice.
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Postby capitalP » Thu Dec 08, 2011 7:56 pm

ThAnks for clarification. The only negotiations year over year were for increases on the preferential rent. I initially signed on here with a two year lease, paying for 21 months spread evenly across 24. All renewal leases always specified the legal rent change and then the preferential rent change, which is what was up for negotiation. That still might be illegal - it wouldn't surprise me if the management company is doing it that way. But that's how it was taking place.

The company did send what I believe to be proper renewal lease forms with a separate DHCR form via mail and then again via email once preferential rent negotions were complete.

I've taken advice from a lawyer (not tenant lawyer and so not especially familiar with these matters) and spoke with a lease relief agency and DHCR just to try and understand the law. It sounds like I need to consult a tenant lawyer?

If you can answer one more question... Can a deemed lease exist and hold up in court if we've never been sent any certification of it? My understanding from DHCR is that even if it automatically goes into effect, LL still has to send a tenant something that documents it. To this date, our LL hasn't sent anything and is just shutting off communication. Trying to figure out if they're bluffing, stalling, taking legal action, etc. I'm trying not to damage my credit or rental history but very eager to get out of this place. With rentals being through the roof in Manhattan, I wouldn't have thought they'd be THIS impossible to work with.
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Postby ronin » Fri Dec 09, 2011 3:11 am

I smell a rat. How does a preferential rent get "deemed". It is either signed or you owe the regulated rent. And since when does a regulated LL care about a tenant vacating. They usually throw a party to celebrate.
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Postby capitalP » Fri Dec 09, 2011 1:33 pm

Well your senses are probably spot on. The LL couldn't be making this more difficult. The only communication we've received was an email saying they would let us off the hook if we pay two month's of rent as a penalty fee. All we've asked for is some verification that they aren't making all of this up (show us the law, clause, etc that obligates us) and they've gone completely silent for over 2 weeks.

We're going to sign a lease at a new place tomorrow for Feb 1, immediately notify (formally) our management that we're leaving at the end of January. We'll pay Dec and Jan rent and then we're out - assuming the security deposit is gone for good and praying that's all this costs us.

Before we commit to the other place, would love to hear if anyone on here would warn us against it.
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Postby TenantNet » Fri Dec 09, 2011 3:08 pm

Assuming there's no physical damages, some tenants would consider withholding the last month's rent to recoup the security deposit. Now that's not the way things are supposed to be done, however Landlords aren't supposed to withhold deposits without valid reasons. In the end it's usually a wash if the LL recoups the rent that's owed and there's no physical damages, i.e., making him whole.

Review the situation carefully to see if the deemed lease was done properly. The danger, of course, is that you could be held liable for the rent for the remainder of the term, or until a new tenant takes the place. So I would tread carefully. Get some legal advice.
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Postby capitalP » Fri Dec 09, 2011 5:33 pm

Thanks for the guidance. Went over everything with our lawyer this afternoon who confirmed based on precedent and certain clauses in the original lease that we're in the right.

Appreciate the responses. This is a great resource amidst a totally confusing and frustrating process.
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Postby brookerlyne » Sat Dec 17, 2011 6:41 am

Can a deemed lease exist and hold up in court if we've never been sent any certification of it? My understanding from DHCR is that even if it automatically goes into effect, LL still has to send a tenant something that documents it. To this date, our LL hasn't sent anything and is just shutting off communication.

Correct. I spoke with a Crt Atty who said the debate at Housing court is a) did the LL send a proper initial renewal? b) Did the LL formally inform Tenant of the deemed renewal? ... Simply raising the rent/invoicing at time of lease commencement is not enough. The LL MUST deliver to Tenant a copy of the renewal lease with some sort of notation stating "AUTOMATICALLY/DEEMED RENEWED" (mandatory). Though not required, it should be sent to Tenant after 60 day offer expiration, but before renewal commencement, which the Tenant can still immediately protest by claiming they did not receive 1st/initial renewal (especially if Landlord can not provide proof of mailing) and usual non receipt rules apply.
The above isnt legal advice - just an opinion.
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Postby TenantNet » Sat Dec 17, 2011 7:52 am

The tenant can also protest the so-called deemed lease by claiming a) it's not at the legal rent, or b) the LL changed the terms and conditions of the last expiring lease, or c) it wasn't on DHCR's RTP-8 form. There might be other grounds to protest, but I would think those would be the most common.

Tenants should probably sign and return the defective lease as per normal, but add something at the bottom, such as "under protest, see attached" and then attach a letter explaining why it is being protested. Also claim it is your "intent" to renew a proper lease. That's important as the case law often revolves around the tenant's intention.
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Postby brookerlyne » Sat Dec 17, 2011 9:17 am

A defective renewal offer completely voids the deemed renewed rule: If the lease renewal "a) is not at the legal rent, or b) the LL changed the terms and conditions of the last expiring lease, or c) it wasn't on DHCR's RTP-8 form" or ANY other defect that would have been grounds for tenants original rejection (including improper delivery), the lease would be considered improper and therefore not eligible to be deemed renewed even if LL fulfilled other steps such as mailing "deemed renewed" notice, etc.

Tenants should probably sign and return the defective lease as per normal, but add something at the bottom, such as "under protest, see attached" and then attach a letter explaining why it is being protested. Also claim it is your "intent" to renew a proper lease. That's important as the case law often revolves around the tenant's intention.


I've seen this advised throughout this forum, but my recent Housing Court and DHCR research conversations say (slightly) different. I was told that the tenant should not sign the renewal, but most definitely should "attach a letter explaining why it is being protested(/rejected). Also claim it is your (strong) intent to renew a proper lease. " The letter (sent w/ tracking) should also request from the LL a revised and proper renewal lease. Court Atty explained that they see LLs claiming they sent/gave renewals all the time when they didn't, so proving the timely delivery of "deemed renewed" lease and Tenants prompt response (denial of ever receiving 1st mailing) is important. Basically, she said as long as Tenant responds to LL notices they should be in the clear.
It was explained that signing "under protest" and paying the higher rent is prejudicial to the Tenant, as all the LL has to do is make the corrections when so ordered (by Judge or DHCR), but still benefits from the collection of the undue increase. Hence, RSC 2523.5(c)(1), allows the tenant to start to pay the increase and choose renewal start/terms ONLY when a proper offer is made by LL and accepted by Tenant (a rejected/defective offer usually becomes 'untimely' after Tenants rejection/protest).

My question is:
Can Tenant sign under protest and not pay increase?
What happens if Tenant rejects offer based on defects/improper renewal, but pays the increased rent because LL is billing at the increased rate?
The above isnt legal advice - just an opinion.
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