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Security Deposit

NYC Rent Regulation: Rent Control/Rent Stabilized, DHCR Practice/Procedures

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Security Deposit

Postby Micky » Thu Mar 09, 2023 8:32 pm

I have been in a rent stabilized apartment for 40+ years. My landlord has recently sent me a check (which I have not cashed) for the entirety of all my security deposits dating back all those 40+ years. I feel that this is some kind of scam the landlord is attempting to undermine my rent-stabilized lease. My landlord claims that "administrative issues" are preventing him from holding my security deposit. Comments and thoughts? Thank you.
Micky
 
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Re: Security Deposit

Postby TenantNet » Thu Mar 09, 2023 8:46 pm

I don't know if it's a scam, but certainly unusual. The general rule is that the deposit must be increased to the level of the current rent, and the tenants are supposed to receive, as interest, a VERY small percentage of the amount. (it's the earned interest minus 1%). Landlords are required to keep the money in a trust account. Banks do this regularly. You should get a yearly 1099 of the interest earnings.

Some LL don't play by the rules. They might combine all tenants' rent deposit in one large account and commingle it all (illegal). OTOH, some do not demand the amount increase.

I don't know what administrative issues he's referring. Has he gone into more detail on that?

I would not worry too much about it, but do keep copies of everything on this, and get all his comments in writing (email should be OK).
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Re: Security Deposit

Postby Micky » Thu Mar 09, 2023 9:12 pm

Thanks for that reply. Everything you said was on-point. I'm very happy that I found this forum. "Administrative issues" are amongst a litany of reasons given by the LL during the past few months, and I have other suspicions that I won't enumerate on at this time. I've reached out to a few agencies and attorney friends whose purview it is to deal with these sought of landlord/tenant issues for their suggestions as well. I also welcome comments from others on this forum. Thank you again.
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Re: Security Deposit

Postby TenantNet » Fri Mar 10, 2023 12:25 am

I'd send him an email, asking specifically what administrative issues he's dealing with. At least get him on record if possible.

But even if you didn't get the interest, these days it's mere pennies, I'd consider cashing the check. At least you'll have the money under your control. Again, keep copies of every little slip of paper, including envelopes with postmarks. If mailing the LL, use a Certificate of Mailing and take a photo of it at the P.O. (most clerks will let you do that). In my opinion, it would be hard for him to ask for the deposit back. Understand that deposits are not rent. They can't come after it in a non-pay proceeding. However they might claim a tenants' failure to top off the deposit is a violation of the lease, and file a Holdover.

If your atty friends can offer more, please post it here.
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Re: Security Deposit

Postby Micky » Fri Mar 10, 2023 1:59 am

Thanks again. My concern is that the LL is attempting to make a change to a major provision of the lease without my input or permission. My understanding is that a lease is like a contract, which binds both parties to its terms. Just as I cannot change the terms of the lease unilaterally, nor can the landlord arbitrarily decide to void certain obligations as a party to the contract without agreement of the tenant. This is less about money and more a matter of principle. My rent and the top-off of my security deposit are all up-to-date.

I'm sure 99% of New Yorkers would agree that when a landlord is attempting to return money to a tenant under these unusual circumstances, red flags get raised. The LL agreed to hold my security deposit in an interest bearing account, as per the terms of my rent-stabilized lease. That is exactly what he should be doing. I suspect this is an end-run attempt to erode both this and other provisions of my lease.

The irony here is that while most folks are having issues getting their security deposits back, I'm having an issue getting my landlord to keep mine !!!

Once a tenant makes a concession, who knows where that ends? From all I have read, the LL cannot change the rules in the middle of the game, i.e., in the middle of a lease. The LL is required to either make a mutually agreeable amendment to the current lease, or draw up new provisions at the time of lease renewal.

I thank you again for your input and your patience as a new user on this forum. I commend you on the work you are doing to help provide a platform for tenants here in New York City. God bless.
Micky
 
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Re: Security Deposit

Postby TenantNet » Fri Mar 10, 2023 2:19 am

It's a RS lease. The LL cannot change the terms and conditions of the lease. That is black-letter law. Even if not RS, they can only make changes on renewals. RS renewals must be at the same terms and conditions, except:
- RGB increases
- DHCR orders such as MCI rent increases, etc.

Many LLs try to do this, but you need to resist if it happens (you say right now you just suspect)

Even if both parties agree, changing a RS lease terms is considered not doable. (there may be exceptions though, so it depends, but rare IMHO). Legally you cannot make a concession.

The LL is required to either make a mutually agreeable amendment to the current lease, or draw up new provisions at the time of lease renewal.


No, not true. As above, RS renewals must be on same terms and condition. Neither LL nor tenant, on their own or together, cannot make changes, either mid-lease or at renewal time. That is a fundamental of the RS system.

See Riverside v. Munroe
https://law.justia.com/cases/new-york/a ... 02973.html

Again, I'd take the money, but document everything.
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