§ 7-107 — Deposits made by tenants of rent stabilized dwelling units

New York § 7-107

• Jurisdiction: New York
• Law GOB: General Obligations
• Title 1: Money Deposited As Security to Be Held In Trust In Certain Cases
• Art. 7: Obligations Relating to Property Received As Security

Text

§ 7-107. Deposits made by tenants of rent stabilized dwelling units.\n1. This section shall apply only to dwelling units subject to the New\nYork city rent stabilization law of nineteen hundred sixty-nine or the\nemergency tenant protection act of nineteen seventy-four.\n 2. No deposit or advance shall exceed the amount of one month's rent,\nunder any contract for the lease or tenancy of a dwelling unit subject\nto this section.\n 3. The entire amount of the deposit or advance, shall be refundable to\nthe tenant upon the tenant's vacating of the premises except for an\namount lawfully retained for the reasonable and itemized costs due to\nnon-payment of rent, damage caused by the tenant beyond normal wear and\ntear, non-payment of utility charges payable directly to the landlord\nunder the terms of the lease or tenancy, and moving and storage of the\ntenant's belongings. The landlord may not retain any amount of the\ndeposit for costs relating to ordinary wear and tear of occupancy or\ndamage caused by a prior tenant.\n 4. After initial lease signing but before the tenant begins occupancy,\nthe landlord shall offer the tenant the opportunity to inspect the\npremises with the landlord or the landlord's agent to determine the\ncondition of the property. If the tenant requests such inspection, the\nparties shall execute a written agreement before the tenant begins\noccupancy of the unit attesting to the condition of the property and\nspecifically noting any existing defects or damages. Upon the tenant's\nvacating of the premises, the landlord may not retain any amount of the\ndeposit or advance due to any condition, defect, or damage noted in such\nagreement. The agreement shall be admissible as evidence of the\ncondition of the premises at the beginning of occupancy only in\nproceedings related to the return or amount of the security deposit.\n 5. Within a reasonable time after notification of either party's\nintention to terminate the tenancy, unless the tenant terminates the\ntenancy with less than two weeks' notice, the landlord shall notify the\ntenant in writing of the tenant's right to request an inspection before\nvacating the premises and of the tenant's right to be present at the\ninspection. If the tenant requests such an inspection, the inspection\nshall be made no earlier than two weeks and no later than one week\nbefore the end of the tenancy. The landlord shall provide at least\nforty-eight hours written notice of the date and time of the inspection.\nAfter the inspection, the landlord shall provide the tenant with an\nitemized statement specifying repairs or cleaning that are proposed to\nbe the basis of any deductions from the tenant's deposit. The tenant\nshall have the opportunity to cure any such condition before the end of\nthe tenancy. Any statement produced pursuant to this subdivision shall\nonly be admissible in proceedings related to the return or amount of the\nsecurity deposit.\n 6. Within fourteen days after the tenant has vacated the premises, the\nlandlord shall provide the tenant with an itemized statement indicating\nthe basis for the amount of the deposit retained, if any, and shall\nreturn any remaining portion of the deposit to the tenant. If a landlord\nfails to provide the tenant with the statement and deposit within\nfourteen days, the landlord shall forfeit any right to retain any\nportion of the deposit.\n 7. In any action or proceeding disputing the amount of any portion of\nthe deposit retained, the landlord shall bear the burden of proof as to\nthe reasonableness of the amount retained.\n 8. Any person who violates the provisions of this section shall be\nliable for actual damages, provided a person found to have willfully\nviolated this section shall be liable for punitive damages of up to\ntwice the amount of the deposit or advance.\n 9. (a) In circumstances where any sum of money or any other thing of\nvalue deposited as security for the full performance by a tenant of the\nterms of their lease is not turned over to a successor in interest\npursuant to section 7-105 of this title, the grantee or assignee of the\nleased premises shall also be liable to such tenant, upon conveyance of\nsuch leased premises, for the repayment of any such security deposit,\nplus accrued interest, as to which such grantee or assignee has actual\nknowledge.\n (b) For purposes of this section, a grantee or assignee of the leased\npremises shall be deemed to have actual knowledge of any security\ndeposit which is (i) deposited at any time during the six months\nimmediately prior to closing or other transfer of title in any banking\norganization pursuant to subdivision two-a of section 7-103 of this\ntitle, or (ii) acknowledged in any lease in effect at the time of\nclosing or other transfer of title, or (iii) supported by documentary\nevidence provided by the tenant or lessee as set forth in paragraph (c)\nof this subdivision.\n (c) With respect to any leased premises for which there is no record\nof security deposit pursuant to subparagraph (i) or (ii) of paragraph\n(b) of this subdivision, the grantee or assignee of the leased premises\nshall be obligated to notify the tenant thereof in writing no later than\nthirty days following the closing or other transfer of title to the fact\nthat there is no record of a security deposit for said leased premises\nand that unless the tenant within thirty days after receiving notice\nprovides them or it with documentary evidence of deposit, the tenant\nshall have no further recourse against them or it for said security\ndeposit. For purposes of this subdivision, "documentary evidence" shall\nbe limited to any cancelled check drawn to the order of, a receipt from,\nor a lease signed by any predecessor in interest, if such predecessor's\ninterest in the leased premises existed on or after the effective date\nof this paragraph. Except as otherwise provided by subparagraphs (i) and\n(ii) of paragraph (b) of this subdivision, the grantee or assignee of\nthe leased premises shall not be charged with actual knowledge of the\nsecurity deposit where the tenant fails within the thirty-day period to\nprovide such documentary evidence. Where the grantee or assignee of the\nleased premises fails to notify the tenant as specified in this\nparagraph within thirty days following the closing or other transfer of\ntitle, the tenant shall be entitled to produce documentary evidence at\nany time.\n (d) The grantee or assignee of the leased premises shall have the\nright to demand that the grantor or assignor thereof establish an escrow\naccount equal to one month's rent for any leased premises for which\nthere is no record of a security deposit pursuant to paragraph (b) of\nthis subdivision to be used for the purpose of holding harmless the\ngrantee or assignee in any case where, at a date subsequent to the\nclosing or other transfer of title, the tenant gives notice pursuant to\nparagraph (c) of this subdivision.\n (e) The liability of a receiver for payment of any security deposit\nplus accrued interest pursuant to this subdivision shall be limited to\nthe amount of such deposit actually turned over to them or it pursuant\nto subdivision one of section 7-105 of this title and to the operating\nincome in excess of expenses generated during their or its period of\nreceivership.\n 10. Any agreement by a lessee or tenant of a dwelling waiving or\nmodifying their rights as set forth in this section shall be absolutely\nvoid.\n