Expands the right to seek the appointment of administrators of buildings to tenants and local governments throughout the state and to make procedures conform with realities of housing stock throughout the state; repeals certain provisions of the real property actions and proceedings law relating thereto.
STATE OF NEW YORK
________________________________________________________________________
9956
IN SENATE
April 17, 2026
___________
Introduced by Sen. BOTTCHER -- read twice and ordered printed, and when
printed to be committed to the Committee on Housing, Construction and
Community Development
AN ACT to amend the real property actions and proceedings law and the
New York city civil court act, in relation to expanding the right to
seek the appointment of administrators of buildings to tenants and
local governments throughout the state; and to repeal sections 777 and
796-i of the real property actions and proceedings law relating there-
to
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision 1 of section 769 of the real property actions
2 and proceedings law, as amended by chapter 877 of the laws of 1982, is
3 amended to read as follows:
4 1. A special proceeding by tenants of a dwelling in the city of New
5 York or the counties of Nassau, Suffolk, Rockland and Westchester or by
6 the department or agency responsible for the enforcement of the multiple
7 dwelling law, the multiple residence law, the uniform fire prevention
8 and building code, or any other law, code or ordinance governing the
9 occupancy and maintenance of residential property or addressing condi-
10 tions dangerous to health, life, and safety in the municipality or coun-
11 ty where the dwelling is located (hereinafter in this article referred
12 to as "the housing standards department") for a judgment directing the
13 deposit of rents into court and their use for the purpose of remedying
14 conditions dangerous to life, health or safety may be maintained in the
15 civil court of the city of New York, the district court of the counties
16 of Suffolk and Nassau and the county courts or city courts in the coun-
17 ties of Rockland and Westchester.
18 § 2. Section 770 of the real property actions and proceedings law, as
19 amended by chapter 655 of the laws of 1978, subdivision 1 as amended by
20 chapter 455 of the laws of 2013, is amended to read as follows:
21 § 770. Grounds for the proceeding. 1. One-third or more of the tenants
22 occupying a dwelling located in the city of New York or the commissioner
23 of the department of the city of New York charged with enforcement of
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD07373-04-6
S. 9956 2
1 the housing maintenance code of such city, or in the counties of Nassau,
2 Suffolk, Rockland and Westchester may maintain a special proceeding as
3 provided in this article, upon the ground that there exists in such
4 dwellings or in any part thereof a lack of heat or of running water or
5 of light or of electricity or of adequate sewage disposal facilities, or
6 any other condition dangerous to life, health or safety, which has
7 existed for five days, or an infestation by rodents, or any combination
8 of such conditions; or course of conduct by the owner or the owner's
9 agents of harassment, illegal eviction, retaliation as defined by
10 section two hundred twenty-three-b of the real property law, interfer-
11 ence with the right of tenants to form, join or participate in tenants'
12 groups pursuant to section two hundred thirty of the real property law,
13 continued deprivation of services or other acts dangerous to life,
14 health or safety, or a business practice of neglect as defined in subdi-
15 vision three of this section, or the issuance of an order to the owner
16 of such dwelling by the commissioner of such department of the city of
17 New York pursuant to the alternative enforcement program under section
18 27-2153 of the administrative code of the city of New York, provided
19 that such dwelling has not been discharged from the program pursuant to
20 such section and there has not been a determination that the owner has
21 substantially complied with such order.
22 2. If the proceeding is instituted by the commissioner of the depart-
23 ment of the city of New York charged with enforcement of the housing
24 maintenance code of such city, one-third or more of the tenants may, at
25 any time thereafter during the pendency of the proceeding or after final
26 judgment pursuant to section seven hundred seventy-six [or seven hundred
27 seventy-seven] of this article, petition for substitution of themselves
28 in place and [stead] instead of such commissioner of such department,
29 or, in the alternative, move to be joined as a party. Such substitution
30 or joinder shall be ordered by the court unless good reason to the
31 contrary shall be shown.
32 3. For the purposes of this article, a business practice of neglect
33 shall be defined as a course of conduct comprising acts or omissions by
34 the owner, person acting on the owner's behalf, mortgagee, and/or lienor
35 of record, which results in a clear and convincing pattern of recurrent
36 qualifying conditions and/or code violations, even if no such conditions
37 or violations exist at the time of the filing of the petition. A quali-
38 fying condition for purposes of this article is a condition dangerous to
39 health, life, or safety. A clear and convincing pattern of recurrent
40 qualifying conditions and/or code violations exists when within the
41 twelve months preceding the date of the filing of the petition:
42 (a) for at least one-third of the dwelling units within the subject
43 dwelling, there have existed at least two qualifying conditions and/or
44 code violations for a qualifying condition; or
45 (b) the sum of qualifying conditions and/or code violations for a
46 qualifying condition which have existed within the subject dwelling or
47 dwelling units therein equals or exceeds twice the number of dwelling
48 units; or
49 (c) the sum of qualifying conditions and/or violations for qualifying
50 conditions which the owner has failed to promptly correct within the
51 subject dwelling or dwelling units therein equals or exceeds the number
52 of dwelling units; or
53 (d) for at least one-third of the dwelling units within the subject
54 dwelling, there have existed at least one qualifying condition and/or
55 violation for a qualifying condition, and a clear and convincing pattern
56 of recurrent qualifying conditions or code violations as defined in
S. 9956 3
1 paragraph (a), (b), or (c) of this subdivision exists in another dwell-
2 ing within New York state with the same owner.
3 § 3. Section 771 of the real property actions and proceedings law, as
4 amended by chapter 877 of the laws of 1982, is amended to read as
5 follows:
6 § 771. Commencement; notice of petition; time and manner of service.
7 1. A special proceeding prescribed by this article shall be commenced by
8 the service of a petition and notice of petition. [A notice of petition
9 may be issued only by a judge or the clerk of the court.]
10 2. The notice of petition shall specify the time and place of the
11 hearing on the petition and state that if at such time, a defense to
12 such petition is not interposed and established by the owner or any
13 mortgagee or lienor of record, a final judgment may be rendered direct-
14 ing that the rents due on the date of entry of such judgment from the
15 petitioning tenants and the rents due on the dates of service of such
16 judgment on all other tenants occupying such dwelling, from such other
17 tenants, shall be deposited with the administrator appointed pursuant to
18 section seven hundred seventy-eight of this article, and any rents to
19 become due in the future from such petitioners and from all other
20 tenants occupying such dwelling shall be deposited with such administra-
21 tor as they fall due; and that such deposited rents shall be used,
22 subject to the court's direction, to the extent necessary to remedy the
23 condition or conditions alleged in the petition.
24 3. The notice of petition and petition shall be served:
25 a. upon the owner of such dwelling last registered with the department
26 of housing preservation and development of such city pursuant to article
27 [forty-one of chapter twenty-six] two of subchapter four of chapter two
28 of title twenty-seven of the administrative code of the city of New York
29 and in Nassau, Suffolk, Rockland and Westchester counties upon the
30 person set forth as the owner on the last recorded deed to the rented
31 property and;
32 b. upon every mortgagee and lienor of record[, and upon the city of
33 New York, at least five days before the time at which the petition is
34 noticed to be heard];
35 c. upon the municipality where the dwelling is located; and
36 d. upon any non-petitioning tenants.
37 4. The proof of service shall be filed with the court before which the
38 petition is to be heard on or before the return date.
39 5. Manner of service of the notice of petition and petition. a. Upon
40 the owner. (1) Service [of the notice of petition and petition] shall be
41 made upon the owner at least five days before the time at which the
42 petition is noticed to be heard by personally delivering [them] the
43 notice of petition and petition to the person or persons required to be
44 served pursuant to paragraphs a and b of subdivision three of this
45 section. [Service upon the city of New York shall be made by personal
46 delivery to the commissioner of the city department charged with
47 enforcement of the housing maintenance code of such city, or to an agent
48 duly authorized to accept such service on his behalf. If service cannot
49 with due diligence be made within the city upon an owner, mortgagee or
50 lienor of record in such manner, it shall be made:
51 (1) upon the owner last registered with the department of housing
52 preservation and development pursuant to article forty-one of chapter
53 twenty-six of the administrative code of the city of New York and in
54 Nassau, Suffolk, Rockland and Westchester counties upon the person set
55 forth as the owner on the last recorded deed to the rented property by
56 delivering to and leaving personally with the person designated pursuant
S. 9956 4
1 to article forty-one of chapter twenty-six of such code as managing
2 agent of the subject dwelling, and in Nassau, Suffolk, Rockland and
3 Westchester counties upon the person designated as the managing agent of
4 the rented property if one shall have been designated, a copy of the
5 notice of petition and petition;
6 (2) upon a mortgagee or lienor of record, by registered or certified
7 mail, return receipt requested, at the address set forth in the recorded
8 mortgage or lien.
9 b. If such personal service upon the person designated pursuant to
10 article forty-one of chapter twenty-six of the administrative code of
11 the city of New York as managing agent of the subject dwelling and in
12 Nassau, Suffolk, Rockland and Westchester counties upon the person set
13 forth as the owner on the last recorded deed to the rented property
14 cannot be made with due diligence, service upon such last registered
15 owner shall be made by affixing a copy of the notice and petition upon a
16 conspicuous part of the subject dwelling; and in addition, within two
17 days after such affixing, by sending a copy thereof by registered or
18 certified mail, return receipt requested, to the owner at the last
19 address registered by him with the department of housing preservation
20 and development or, in the absence of such registration, to the address
21 set forth in the last recorded deed with respect to such premises.]
22 (2) If such service cannot be made with due diligence within the city
23 of New York if the dwelling is located therein or otherwise within the
24 county where the dwelling is located, it shall be made by affixing a
25 copy of the notice and petition upon a conspicuous part of the subject
26 dwelling; and in addition, within two days after such affixing, by send-
27 ing to the owner a copy thereof by registered or certified mail, return
28 receipt requested, and a copy thereof by registered or certified or
29 regular first-class mail, no return receipt requested. If the subject
30 dwelling is located in the city of New York, such mailing shall be sent
31 to the address last registered with the department of housing preserva-
32 tion and development pursuant to article two of subchapter four of chap-
33 ter two of title twenty-seven of the administrative code of the city of
34 New York, or in the absence of such registration, to the address set
35 forth in the last recorded deed for the subject dwelling. If the subject
36 dwelling is located outside the city of New York, such mailing shall be
37 sent to the address where local property tax bills for the subject
38 dwelling are sent or, in the alternative if the jurisdiction in which
39 the court sits has a rental registry requirement, at the registered
40 address for the subject dwelling.
41 (3) Upon receipt of service of the petition, the owner shall provide
42 to the petitioners, within three days, a written list of all mortgagees
43 and lienors of which the owner is aware and addresses for each.
44 b. Upon mortgagees and lienors. (1) Service shall be made upon each
45 mortgagee and lienor of record at least five days before the time at
46 which the petition is noticed to be heard by either personally deliver-
47 ing the notice of petition and petition or, in the alternative, sending
48 a copy thereof to each mortgagee and lienor of record at the address set
49 forth in the recorded mortgage or lien by certified or registered mail,
50 return receipt requested, and a second copy thereof by certified or
51 registered or regular first-class mail, no return receipt requested.
52 (2) For the purposes of this article, a "mortgagee or lienor of
53 record" shall include only those mortgagees or lienholders whose inter-
54 est is recorded in a publicly accessible database or can be provided on
55 request by the municipal or county registrar, as long as the request
56 includes, at minimum, the address and borough, block, and lot number of
S. 9956 5
1 the subject dwelling, and follows the applicable rules and regulations
2 of the registrar of the county or municipality in which the property is
3 located for requesting such information.
4 c. Upon the municipality. Service shall be made at least five days
5 before the time at which the petition is noticed to be heard upon the
6 municipality as required by paragraph c of subdivision three of this
7 section to the official charged with management of the housing standards
8 department of such municipality, or to an agent duly authorized to
9 accept service on their behalf, either by personally delivering the
10 notice of petition and petition or, in the alternative, sending a copy
11 thereof to the address designated by the official for receipt of service
12 or, if no such address is designated, to the headquarters of the depart-
13 ment, by registered or certified mail, return receipt requested, and a
14 second copy by registered or certified or regular first-class mail, no
15 return receipt requested.
16 d. Upon non-petitioning tenants. Service shall be made at least five
17 days before the time at which the petition is noticed to be heard upon
18 non-petitioning tenants occupying the dwelling by affixing a copy of the
19 notice of petition and petition upon a conspicuous part of the subject
20 dwelling or, in the alternative, by mailing a copy of the notice of
21 petition and petition to each dwelling unit not occupied by a petition-
22 ing tenant, addressed to "Current Tenant(s)", by registered or certified
23 mail, and a second copy by registered or certified or regular first-
24 class mail, no return receipt requested.
25 6. [Notice to non-petitioning tenants. Notice of the proceeding shall
26 be given to the non-petitioning tenants occupying the dwelling by affix-
27 ing a copy of the notice of petition and petition upon a conspicuous
28 part of the subject dwelling] Contesting service. Defects in service of
29 notice to non-parties are not jurisdictional. The court upon motion or
30 sua sponte may adjourn the proceeding for five days, or up to ten days
31 if requested by petitioners, within which time petitioners shall cure
32 any defects identified by the court.
33 § 4. Subdivisions 1 and 2 of section 772 of the real property actions
34 and proceedings law, as amended by chapter 877 of the laws of 1982, are
35 amended to read as follows:
36 1. Allege material facts showing that there exists in such dwelling or
37 any part thereof one or more of the following: a lack of heat or of
38 running water or of light or electricity or of adequate sewage disposal
39 facilities, or any other condition dangerous to life, health or safety,
40 which has existed for five days, or an infestation of rodents or course
41 of conduct by the owner or [his] the owner's agents of harassment, ille-
42 gal eviction, retaliation as defined by section two hundred twenty-
43 three-b of the real property law, interference with the right of tenants
44 to form, join or participate in tenants' groups pursuant to section two
45 hundred thirty of the real property law, continued deprivation of
46 services or other acts dangerous to life, health or safety; or a busi-
47 ness practice of neglect as defined in subdivision three of section
48 seven hundred seventy of this article; or the issuance of an order to
49 the owner of such dwelling by the commissioner of such housing standards
50 department of the city of New York pursuant to the alternative enforce-
51 ment program under section 27-2153 of the administrative code of the
52 city of New York, provided that such dwelling has not been discharged
53 from the program pursuant to such section and there has not been a
54 determination that the owner has substantially complied with such order.
55 2. If the petitioners shall be tenants occupying the dwelling, they
56 shall allege the number of petitioners making the petition and that they
S. 9956 6
1 constitute one-third or more of the tenants of said dwelling in occupan-
2 cy thereof, or, in the case of a single residence dwelling, that they
3 are the occupants of such dwelling.
4 § 5. Section 774 of the real property actions and proceedings law, as
5 added by chapter 909 of the laws of 1965, is amended to read as follows:
6 § 774. Trial. 1. Where triable issues of fact are raised, they shall
7 be tried by the court without a jury at the time when issue is joined.
8 However, the court[, in its discretion,] may grant [an] a single
9 adjournment of such trial [at] upon request of [either] any party who
10 appears, if [it determines] the requesting party shows that an adjourn-
11 ment is necessary [to enable either of the parties] to procure the
12 necessary witnesses, or upon consent of all the parties who appear. Such
13 adjournment shall not be for more than five days except by consent of
14 all the parties who appear.
15 2. The proceeding shall not be adjourned more than once at the request
16 of the same party except by consent of all the parties who appear, and
17 such adjournments shall not be for more than five days except by consent
18 of all the parties who appear.
19 3. The trial must take place each court day whenever the court is in
20 session until the conclusion of the trial, and accordingly no other
21 cases should be scheduled on the court's calendar for dates prior to the
22 anticipated conclusion of the trial, except by consent of all the
23 parties who appear or during adjournments pursuant to subdivision one or
24 two of this section.
25 § 6. Subdivision c of section 775 of the real property actions and
26 proceedings law, as amended by chapter 877 of the laws of 1982, is
27 amended and a new subdivision d is added to read as follows:
28 c. Any tenant or resident of the dwelling has expressly refused entry
29 to the owner or [his] the owner's agent with access to a portion of the
30 premises for the purpose of correcting such condition or conditions
31 after the owner or their agent provided the tenant or resident with no
32 less than one week written notice of a desire for access, except where
33 such condition requires immediate access in order to prevent injury to
34 persons or damage to property, in which case notice shall be provided by
35 telephone, email, or by knocking on the tenant or resident's door at a
36 reasonable time when such tenant or resident would be expected to be
37 present.
38 d. A tenant's request to reschedule dates of access to a time conven-
39 ient for the tenant or a household member shall not be deemed an express
40 refusal for the purposes of this section.
41 § 7. Section 776 of the real property actions and proceedings law, as
42 added by chapter 909 of the laws of 1965, subdivision b as amended by
43 chapter 877 of the laws of 1982, is amended to read as follows:
44 § 776. Judgment. The court shall render a final judgment either
45 a. Dismissing the petition for failure to affirmatively establish the
46 allegations thereof or because of the affirmative establishment by the
47 owner or a mortgagee or lienor of record of a defense or defenses speci-
48 fied in section seven hundred seventy-five of this article; or
49 b. Directing that (1) the rents due on the date of the entry of such
50 judgment from the petitioning tenants and the rents due on the dates of
51 service of the judgment on all other residential and non-residential
52 tenants occupying such dwelling from such other tenants, shall be depos-
53 ited with the administrator appointed by the court, pursuant to section
54 seven hundred seventy-eight of this article; (2) any rents to become due
55 in the future from all tenants occupying such dwelling shall be deposit-
56 ed with such administrator as they fall due; (3) such deposited rents
S. 9956 7
1 shall be used, subject to the court's direction, to the extent necessary
2 to remedy the condition or conditions or course of conduct alleged in
3 the petition and (4) upon the completion of such work in accordance with
4 such judgment, any remaining surplus shall be turned over to the owner,
5 together with a complete accounting of the rents deposited and the costs
6 incurred; and granting such other and further relief as to the court may
7 seem just and proper. A certified copy of such judgment shall be served
8 personally, by the administrator appointed by the court pursuant to
9 section seven hundred seventy-eight of this article, upon each non-peti-
10 tioning tenant occupying such dwelling and [upon the city of New York]
11 the housing standards department by service as provided in subdivision
12 five of section seven hundred seventy-one of this article. If personal
13 service on any such non-petitioning tenant cannot be made with due dili-
14 gence, service on such tenant shall be made by affixing a certified copy
15 of such judgment on the entrance door of such tenant's apartment, store
16 or other unit and, in addition, within one day after such affixing, by
17 sending a certified copy thereof by certified or registered mail, return
18 receipt requested, to such tenant. Any right of the owner of such dwell-
19 ing to collect such rent moneys from any petitioning tenant of such
20 dwelling on or after the date of entry of such judgment, and from any
21 non-petitioning tenant of such dwelling on or after the date of service
22 of such judgment on such non-petitioning tenant as herein provided,
23 shall be void and unenforceable to the extent that such petitioning or
24 non-petitioning tenant, as the case may be, has deposited such moneys
25 with the administrator in accordance with the terms of such judgment,
26 regardless of whether such right of the owner arises from a lease,
27 contract, agreement or understanding heretofore or hereafter made or
28 entered into or arises as a matter of law from the relationship of the
29 parties or otherwise. It shall be a valid defense in any action or
30 proceeding against any such tenant to recover possession of real proper-
31 ty for the non-payment of rent or for use or occupation to prove that
32 the rent alleged to be unpaid was deposited with the administrator in
33 accordance with the terms of a judgment entered under this section.
34 c. Directing the owner to provide written notice to the court, court-
35 appointed administrator, housing standards department, and petitioning
36 tenants within ten days of entering into a contract of sale with a
37 prospective purchaser of the premises.
38 d. Neither the owner nor a court-appointed administrator shall, with-
39 out good cause, serve a notice to quit upon any tenant or commence any
40 action to recover real property or summary proceeding to recover
41 possession of real property, or substantially alter the terms of a
42 tenant's lease, including, but not limited to, refusing to continue a
43 tenancy of the tenant upon expiration of the tenant's lease, to renew
44 the lease or offer a new lease, or offering a new lease with a rent
45 increase equal to or greater than five percent above the current lease,
46 within one year of a judgment pursuant to this section; provided, howev-
47 er, that an owner shall not be required under this section to offer a
48 new lease or a lease renewal for a term greater than one year.
49 § 8. Section 777 of the real property actions and proceedings law is
50 REPEALED.
51 § 9. Section 778 of the real property actions and proceedings law, as
52 amended by chapter 963 of the laws of 1974, subdivisions 1 and 6 as
53 amended and subdivision 11 as added by chapter 455 of the laws of 2013,
54 the opening paragraph of subdivision 1 as amended by chapter 48 of the
55 laws of 2015, subdivision 3 as amended by chapter 305 of the laws of
56 1978, subdivision 4 as added by chapter 521 of the laws of 1979, subdi-
S. 9956 8
1 vision 5 as added by chapter 769 of the laws of 1981, subdivision 7 as
2 added by chapter 737 of the laws of 1985, subdivisions 8 and 9 as added
3 by chapter 95 of the laws of 1989, subdivision 10 as amended by chapter
4 40 of the laws of 2001, paragraph (a) of subdivision 10 as amended by
5 chapter 387 of the laws of 2003 and paragraph (b) of subdivision 10 as
6 amended by chapter 265 of the laws of 2009, is amended to read as
7 follows:
8 § 778. Appointment of administrator. 1. The court is authorized and
9 empowered, in implementation of a judgment rendered pursuant to section
10 seven hundred seventy-six [or seven hundred seventy-seven] of this arti-
11 cle, to appoint a person other than the owner, a mortgagee or lienor, to
12 receive and administer the rent moneys or security deposited with such
13 owner, mortgagee or lienor, subject to the court's direction. The court
14 may appoint the [commissioner of the department of the city of New York
15 charged with enforcement of the housing maintenance code of such city]
16 official charged with managing the housing standards department or the
17 commissioner's designee as such administrator, provided that the commis-
18 sioner or the commissioner's designee shall consent, in writing, to such
19 appointment. Any administrator is authorized and empowered in accordance
20 with the direction of the court, to order the necessary materials, labor
21 and services to remove or remedy the conditions specified in the judg-
22 ment, and to make disbursements in payment thereof; and to demand,
23 collect and receive the rents from the tenants; and to institute all
24 necessary legal proceedings including, but not limited to, summary
25 proceedings for the removal of any tenant or tenants; and to rent or
26 lease for terms not exceeding three years any part of said premises,
27 however, the court may direct the administrator to rent or lease commer-
28 cial parts of said premises for terms that the court may approve. In
29 addition, such administrator is authorized and empowered in accordance
30 with the direction of the court to accept and repay such moneys as may
31 be received from the housing standards department [charged with enforce-
32 ment of the housing maintenance code of the city of New York] for the
33 purpose of managing the premises, replacing or substantially rehabili-
34 tating systems or making other repairs or capital improvements author-
35 ized by the court. All moneys expended by the department pursuant to the
36 foregoing shall constitute a debt recoverable from the owner and a lien
37 upon the building and lot, and upon the rents and other income thereof.
38 Such lien shall be enforced in accordance with the provisions of article
39 eight of subchapter five of the housing maintenance code of the city of
40 New York, or in accordance with any applicable provisions for all other
41 counties. Such administrator, shall, upon completion of the work
42 prescribed in such judgment, file with the court a full accounting of
43 all receipts and expenditures for such work. Such administrator shall
44 dispose of the rents and other monies deposited with such administrator
45 according to the following order of priority:
46 (a) Payment in full for all of the work specified in the judgment,
47 fuel bills, fire and liability insurance, and bills for ordinary repairs
48 and maintenance, including correcting conditions in violation of the
49 law. Until all of the work specified in the judgment has been completed
50 and payment for such work has been made, no other disbursements shall be
51 permitted[, except for fuel bills, fire and liability insurance, and
52 bills for ordinary repairs and maintenance].
53 (b) Payment of a reasonable amount for the services of such adminis-
54 trator, including reimbursement of any legal fees incurred by such
55 administrator in connection with management of the building.
S. 9956 9
1 (c) Payment of outstanding real property tax liens claimed by [the
2 city of New York] any municipality or county in which the dwelling is
3 located.
4 (d) Payment of outstanding emergency repair liens filed and recorded
5 by [the city of New York] any municipality or county in which the dwell-
6 ing is located and outstanding liens filed and recorded by [the city]
7 such municipality or county pursuant to this section.
8 (e) Abatements for all tenants of up to twenty-five percent of rent
9 for the period during which the administrator is appointed. Nothing in
10 this paragraph shall prevent any tenant from prosecuting a claim in a
11 court of competent jurisdiction for breach of warranty of habitability;
12 however, any resulting relief from such claim will be reduced by the
13 amount of the abatement awarded herein.
14 (f) Payment to the owner of any surplus remaining after payments of
15 paragraphs (a) through [(d)] (e) of this subdivision have been made.
16 2. Unless the administrator is the [city of New York] municipality or
17 county, the court may allow from the rent moneys or security on deposit
18 a reasonable amount for services of such administrator.
19 3. Unless such administrator is the [city of New York] municipality or
20 county, the administrator so appointed shall furnish a bond, the amount
21 and form of which shall be approved by the court. In its discretion and
22 for good cause shown, the court may dispense with the necessity for a
23 bond. The cost of a required bond shall be paid from the moneys so
24 deposited.
25 4. Such administrator shall file a transcript of the judgment appoint-
26 ing [him] them with the county clerk within fifteen days of [his] their
27 appointment.
28 5. The duties of such administrator shall not be affected by the
29 appointment of a receiver in an action to foreclose a mortgage on the
30 premises, except that the rights of the owner, including the right to
31 any surplus, pursuant to paragraph [(e)] (f) of subdivision one of this
32 section, shall pass to the receiver. The court in which the action to
33 foreclose a mortgage on the premises is pending may appoint such admin-
34 istrator to serve as receiver in that action in addition to [his] their
35 duties as administrator pursuant to this article.
36 6. Such administrator shall be liable only in [his or her] such admin-
37 istrator's official capacity for injury to persons and property by
38 reason of conditions of the premises in a case where an owner would have
39 been liable; [he or she] such administrator shall not have any liability
40 in [his or her] such administrator's personal capacity. Appointment of
41 an administrator pursuant to subdivision one of this section shall not
42 relieve an owner of liability for injury to persons and property in such
43 case.
44 7. No [city] municipality or county specified in section seven hundred
45 sixty-nine of this article shall be liable to any party, including such
46 administrator or the owner, for injury to persons or property by reason
47 of conditions of the premises or the acts or omissions of such adminis-
48 trator, except that when the [city of New York] municipality or county
49 is appointed administrator, liability shall be determined in accordance
50 with subdivision six of this section.
51 8. The commissioner of the department of the city of New York charged
52 with the enforcement of the housing maintenance code of such city shall
53 promulgate rules and regulations regarding criteria for the selection of
54 administrators to be appointed pursuant to this section and shall estab-
55 lish and maintain a list of organizations and persons approved by such
56 department. If the dwelling is located outside the city of New York,
S. 9956 10
1 the official charged with management of the housing standards department
2 shall promulgate rules and regulations regarding criteria for the
3 selection of administrators to be appointed pursuant to this section and
4 may establish and maintain a list of organizations and persons approved
5 by such department. Unless the administrator is the [city of New York]
6 municipality or county, any person appointed as an administrator within
7 such city shall be selected from among the organizations and persons
8 approved as administrators pursuant to such list, any organizations or
9 individuals submitted to the court for consideration by the petitioning
10 tenants pursuant to paragraph (a) of this subdivision, and the petition-
11 ing tenants deemed to have sufficient knowledge and expertise to serve
12 as the administrator.
13 (a) Where an article seven-A proceeding is initiated by tenants, the
14 petitioning tenants shall have the right to submit to the court a list
15 of three preferred organizations and/or individuals selected from the
16 approved list of administrators provided that, if the tenants find no
17 organization or individual on the list to be suitable, the tenants may
18 nominate organizations or individuals outside of the list, including
19 from among the petitioning tenants, along with a summary of each nomi-
20 nee's experience and credentials, for consideration by the court.
21 (b) Where petitioning tenants have submitted preferred organizations
22 and/or individuals selected from the approved list of administrators,
23 the court must appoint an administrator from among the petitioning
24 tenants' preferred approved administrators absent good cause to the
25 contrary.
26 (c) Where petitioning tenants have not submitted preferred organiza-
27 tions or individuals or where the court declines to appoint an adminis-
28 trator from among the petitioning tenants' preferred administrators or
29 nominees, priority of appointment shall be given to not-for-profit
30 corporations formed for the purpose of preserving or developing afforda-
31 ble housing whenever there is no eligible for-profit organization or
32 individual that is clearly more competent.
33 9. (a) Such administrator shall, within thirty days of appointment,
34 file with the court a plan for the provision of essential services and
35 for the correction of such other hazardous conditions as may exist at
36 the premises, specifying dates by which such services shall be provided
37 and such conditions corrected. If such administrator cannot provide such
38 services and correct such conditions by the dates specified in the plan,
39 [he] they shall be required to file with the court an amendment to the
40 plan setting forth the reasons why such services and corrections could
41 not be provided by such date and specifying new dates for such services
42 and corrections. Such plan and any amendments to such plan shall be
43 provided to the tenants by first-class or registered or certified mail
44 [or] and by conspicuously posting in a common area of the building, and
45 to the owner of record by first-class or registered or certified mail.
46 (b) Where an organization has been appointed as the administrator,
47 such administrator shall promptly delegate the responsibilities to a
48 single individual and inform the court of such designation within thirty
49 days. Such person shall remain accountable to the court as the adminis-
50 trator's representative until the administrator's discharge.
51 10. (a) Where a building for which an administrator has been appointed
52 pursuant to this section is transferred to a new owner at any time
53 following the appointment of such administrator, whether or not such
54 building remains subject to such administrator, the housing standards
55 department [charged with enforcement of the housing maintenance code of
56 the city of New York] may enter into a regulatory agreement with such
S. 9956 11
1 new owner. Such regulatory agreement may impose such terms and condi-
2 tions upon the operation and repair of such building as such department
3 may determine. Notwithstanding any general, special or local law to the
4 contrary, such regulatory agreement may provide that, upon transfer of
5 such building to the new owner, any outstanding liens filed with and
6 recorded by the city pursuant to this section or pursuant to section
7 three hundred nine of the multiple dwelling law shall immediately be
8 reduced to zero, provided that such regulatory agreement shall require,
9 in consideration for such reduction to zero, the provision of adequate,
10 safe and sanitary housing accommodations for persons of low income for a
11 period of not less than [thirty] ninety-nine years. Any regulatory
12 agreement pursuant to this subdivision shall include a certification by
13 the new owner of the real property that (i) the prior owner has no
14 direct or indirect interest in such real property, and (ii) the prior
15 owner has no direct or indirect interest in such new owner.
16 (b) On or about June thirtieth, two thousand [nine] twenty-two and for
17 every three years thereafter for as long as the program continues to be
18 in effect, the [city] municipality or county shall submit a report to
19 the governor, the temporary president of the senate, the speaker of the
20 assembly, the minority leader of the senate and the minority leader of
21 the assembly. Each report following the initial report shall describe
22 the program activities carried out during the three prior calendar years
23 pursuant to this subdivision.
24 11. (a) The court may only discharge an administrator if the owner
25 makes a prima facie showing that the conditions and course of conduct
26 which required the appointment of the article seven-A administrator have
27 been cured and that the owner has a detailed plan for the continued
28 maintenance and operation of the dwelling, the owner has paid in full or
29 entered into a payment agreement to pay in full all outstanding real
30 property tax liens claimed by [the city of New York] any municipality or
31 county in which the dwelling is located, all outstanding emergency
32 repair liens filed and recorded by [the city of New York] any munici-
33 pality or county in which the dwelling is located, all outstanding
34 charges and liens assessed in connection to the alternative enforcement
35 program authorized by section 27-2153 of the administrative code of the
36 city of New York, and outstanding liens filed and recorded by [the city]
37 such municipality or county pursuant to this section. The provisions of
38 this subdivision shall not apply to buildings transferred pursuant to
39 subdivision ten of this section.
40 (b) A detailed plan for the continued maintenance of the operations of
41 the dwelling shall include sufficient submissions for the court to eval-
42 uate the owner's willingness and ability to make repairs, including
43 specifying the repairs they will undertake, an estimated budget, a time-
44 table for doing so, identifying the source of funds for those expendi-
45 tures, and balance sheets or income statements.
46 (c) In assessing an owner's fitness for the continued maintenance and
47 operation of the dwelling, the court shall consider the conditions of
48 other properties owned or managed by the owner and shall not discharge
49 the article seven-A administrator where it is found that the owner oper-
50 ates a separate property or separate properties at a standard which is
51 contrary to public health and safety. The court may rely on the visually
52 displayed or the printed computerized violation files of the department
53 responsible for maintaining such files and all other computerized data
54 as shall be relevant to the enforcement of state and local laws for the
55 establishment and maintenance of housing standards.
S. 9956 12
1 12. (a) Where a judgment has been entered pursuant to this section,
2 the municipality must, within six months of such a judgment, certify a
3 finding pursuant to paragraph (c) of subdivision one of section nineteen
4 hundred seventy-one of this chapter.
5 (b) Where a finding of abandonment has been certified, the munici-
6 pality may commence a proceeding pursuant to section nineteen hundred
7 seventy-three of this chapter, or, in the alternative, authorize the
8 court-appointed administrator to sell the property to a purchaser
9 approved by the court pursuant to section seven hundred eighty-four of
10 this article.
11 (c) Notice of such authorization must be issued to all owners, mortga-
12 gors, lienors and lessees of record pursuant to section nineteen hundred
13 seventy-two of this chapter, as well as to all tenants of the subject
14 building.
15 (d) Any owner, mortgagor, lienor or lessee may challenge the authori-
16 zation of sale, provided that the burden of proof is on the challenging
17 party to demonstrate its capacity to resume control of the premises
18 pursuant to subdivision eleven of this section.
19 § 10. Section 779 of the real property actions and proceedings law, as
20 amended by chapter 95 of the laws of 1989, is amended to read as
21 follows:
22 § 779. Presentation or settlement of accounts. The court shall
23 require the keeping of written accounts itemizing the receipts and
24 expenditures under an order issued pursuant to section seven hundred
25 seventy-six [or seven hundred seventy-seven] of this article, which
26 shall be open to inspection by the owner, any mortgagee or lienor or any
27 other person having an interest in such receipts or expenditures
28 provided, however, notwithstanding any other provision of law to the
29 contrary, such information as may be in the possession of the [city of
30 New York with the department charged with the enforcement of the housing
31 maintenance code of such city] housing standards department shall be
32 available from such department for inspection only by the owner, tenant
33 of such property, or person having a recorded interest in the property.
34 Upon motion of the court or the administrator or of the owner, any mort-
35 gagee or lienor of record or of any person having an interest, or the
36 petitioning tenants, the court may require a presentation or settlement
37 of the accounts with respect thereto. Notice of a motion for presenta-
38 tion or settlement of such accounts shall be served on the owner, any
39 mortgagee or other lienor of record who appeared in the proceeding and
40 [any person having an interest in such receipts or expenditures] the
41 petitioning tenants.
42 § 11. Section 782 of the real property actions and proceedings law, as
43 amended by chapter 877 of the laws of 1982, is amended to read as
44 follows:
45 § 782. "Dwelling" defined. As used in this article, the term "dwell-
46 ing" shall mean any building or structure or portion thereof which is
47 occupied in whole or in part as the home, residence or sleeping place of
48 one or more human beings and is either rented, leased, let or hired out,
49 to be occupied, or is occupied as the residence or home of [three] one
50 or more families [living independently of each other]; or is a garden-
51 type maisonette dwelling project as defined in the multiple dwelling law
52 or other similar dwellings which in their aggregate are arranged or
53 designed to provide three or more apartments, have common facilities
54 such as but not limited to a sewer line, water main, or heating plant
55 and are operated as a unit under common ownership, notwithstanding that
56 certificates of occupancy were issued for portions thereof as one or two
S. 9956 13
1 family dwellings or that the dwellings are not a multiple dwelling as
2 defined in the multiple dwelling law. "Dwelling" shall also include
3 premises zoned for mixed residential and commercial use, provided that a
4 portion of such premises are, in fact, occupied by one or more tenants
5 for residential purposes.
6 § 12. Section 783 of the real property actions and proceedings law, as
7 added by chapter 95 of the laws of 1989, is amended to read as follows:
8 § 783. Defense of warranty of habitability inapplicable. Notwith-
9 standing any other provision of law, in any proceeding for the payment
10 of rent commenced by an administrator appointed pursuant to this arti-
11 cle, the provisions of section two hundred thirty-five-b of the real
12 property law pertaining to the warranty of habitability shall not be a
13 defense to such a proceeding for rent which accrues during the period of
14 time that a judgment or an order pursuant to this article is in effect,
15 unless the court determines that the conditions upon which such defense
16 is based were caused by the failure of such administrator to perform
17 [his] such administrator's duties in a reasonable manner. The burden of
18 showing performance of duties in a reasonable manner shall be made by
19 the administrator in such summary proceeding.
20 § 13. The real property actions and proceedings law is amended by
21 adding a new section 784 to read as follows:
22 § 784. Sale of premises; court review. Prior to entering into any
23 contract of sale of the premises subject to judgment, an owner, adminis-
24 trator, mortgagor, or lienor shall submit the proposed contract of sale
25 for review before the court.
26 § 14. The real property actions and proceedings law is amended by
27 adding a new section 785 to read as follows:
28 § 785. Waiver void. Any provision of a lease or other agreement where-
29 by any provision of this article for the benefit of a tenant, resident
30 or occupant of a dwelling is waived, shall be deemed against public
31 policy and shall be void.
32 § 15. Paragraph 5 of subdivision (a) of section 110 of the New York
33 city civil court act, as amended by chapter 849 of the laws of 1977, is
34 amended to read as follows:
35 (5) Actions and proceedings under article seven-A of the real property
36 actions and proceedings law, and all summary proceedings to recover
37 possession of residential premises to remove tenants therefrom, and to
38 render judgment for rent due, including without limitation those cases
39 in which a tenant alleges a defense under section seven hundred fifty-
40 five of the real property actions and proceedings law, relating to stay
41 or proceedings or action for rent upon failure to make repairs, section
42 three hundred two-a of the multiple dwelling law, relating to the abate-
43 ment of rent in case of certain violations of section D26-41.21 of such
44 housing maintenance code. Where one or multiple parts within the housing
45 part have been designated to hear trials, actions and proceedings under
46 article seven-A of the real property actions and proceedings law, such
47 proceedings shall be held before those trial parts and not before the
48 part within the housing part.
49 § 16. Section 796-b of the real property actions and proceedings law,
50 as added by chapter 677 of the laws of 2022, is amended to read as
51 follows:
52 § 796-b. Grounds for the proceeding. One-third or more of the tenants
53 occupying a multiple residence dwelling or a tenant occupying a single
54 residence dwelling or the commissioner of the department charged with
55 enforcement of the housing maintenance code in the municipality where
56 the dwelling is located may maintain a special proceeding as provided in
S. 9956 14
1 this article, upon the grounds that there exists in such dwelling, or in
2 any part thereof:
3 1. a lack of heat, running water, light, electricity, adequate sewage
4 disposal facilities, or any other condition dangerous to life, health or
5 safety, which has existed for five days, or an infestation by rodents,
6 or any combination of such conditions; [or]
7 2. a course of conduct by the owner or the owner's agents of harass-
8 ment, illegal eviction, continued deprivation of services or other acts
9 dangerous to life, health or safety[.];
10 3. retaliation as defined by section two hundred twenty-three-b of the
11 real property law;
12 4. interference with the right of tenants to form, join or participate
13 in tenants' groups pursuant to section two hundred thirty of the real
14 property law; or
15 5. a business practice of neglect, defined as a course of conduct
16 comprising acts or omissions by the owner, person acting on the owner's
17 behalf, mortgagee, and/or lienor of record, which results in a clear and
18 convincing pattern of recurrent qualifying conditions and/or code
19 violations, even if no such conditions or violations exist at the time
20 of the filing of the petition. A qualifying condition for purposes of
21 this article is a condition dangerous to health, life, or safety. A
22 clear and convincing pattern of recurrent qualifying conditions and/or
23 code violations exists when within the twelve months preceding the date
24 of the filing of the petition:
25 (a) for at least one-third of the dwelling units within the subject
26 dwelling, there have existed at least two qualifying conditions and/or
27 code violations for a qualifying condition; or
28 (b) the sum of qualifying conditions and/or code violations for a
29 qualifying condition which have existed within the subject dwelling or
30 dwelling units therein equals or exceeds twice the number of dwelling
31 units; or
32 (c) the sum of qualifying conditions and/or violations for qualifying
33 conditions which the owner has failed to promptly correct within the
34 subject dwelling or dwelling units therein equals or exceeds the number
35 of dwelling units; or
36 (d) for at least one-third of the dwelling units within the subject
37 dwelling, there have existed at least one qualifying condition and/or
38 violation for a qualifying condition, and a clear and convincing pattern
39 of recurrent qualifying conditions or code violations as defined in
40 paragraph (a), (b), or (c) of this subdivision exists in another dwell-
41 ing within New York state with the same owner.
42 § 17. Subdivision 1 of section 796-c of the real property actions and
43 proceedings law, as added by chapter 677 of the laws of 2022, is amended
44 and three new subdivisions 7, 8 and 9 are added to read as follows:
45 1. A special proceeding prescribed by this article shall be commenced
46 by the service of a petition and notice of petition. [A notice of peti-
47 tion may be issued only by a judge or the clerk of the court.]
48 7. Upon receipt of service of the petition, the owner shall provide to
49 the petitioners, within three days, a written list of all mortgagees and
50 lienors of which the owner is aware and addresses for each.
51 8. For the purposes of this article, a "mortgagee or lienor of record"
52 shall include only those mortgagees or lienholders whose interest is
53 recorded in a publicly accessible database or can be provided on request
54 by the municipal or county registrar, as long as the request includes,
55 at minimum, the address and borough, block, and lot number of the
56 subject dwelling, and follows the applicable rules and regulations of
S. 9956 15
1 the registrar of the county or municipality in which the property is
2 located for requesting such information.
3 9. Defects in service of notice to non-parties are not jurisdictional.
4 The court upon motion or sua sponte may adjourn the proceeding for five
5 days, or up to ten days if requested by petitioners, within which time
6 petitioners shall cure any defects identified by the court.
7 § 18. Subdivision 1 of section 796-d of the real property actions and
8 proceedings law, as added by chapter 677 of the laws of 2022, is amended
9 to read as follows:
10 1. Allege material facts showing that there exists in such dwelling or
11 any part thereof one or more of the following:
12 (a) a lack of heat, running water, light, electricity, adequate sewage
13 disposal facilities, or any other condition dangerous to life, health or
14 safety, which has existed for five days, or an infestation of rodents;
15 or
16 (b) a course of conduct by the owner or [his] the owner's agents of
17 harassment, illegal eviction, retaliation as defined by section two
18 hundred twenty-three-b of the real property law, interference with the
19 right of tenants to form, join or participate in tenants' groups pursu-
20 ant to section two hundred thirty of the real property law, continued
21 deprivation of services [or], other acts dangerous to life, health or
22 safety; or a business practice of neglect as defined in subdivision five
23 of section seven hundred ninety-six-b of this article.
24 § 19. Section 796-f of the real property actions and proceedings law,
25 as added by chapter 677 of the laws of 2022, is amended to read as
26 follows:
27 § 796-f. Trial. 1. Where triable issues of fact are raised, they
28 shall be tried by the court without a jury at the time when issue is
29 joined; provided, however, that the court[, in its discretion,] may
30 grant [an] a single adjournment of such trial [at] upon the request of
31 [either] any party who appears, if [it determines] the requesting party
32 shows that an adjournment is necessary [to enable either of the parties]
33 to procure the necessary witnesses, or upon consent of all the parties
34 who appear. Such adjournment shall not be for more than five days except
35 by consent of all the parties who appear.
36 2. The proceeding shall not be adjourned more than once at the request
37 of the same party except by consent of all the parties who appear, and
38 such adjournments shall not be for more than five days except by consent
39 of all the parties who appear.
40 3. The trial must take place each court day whenever the court is in
41 session until the conclusion of the trial, and accordingly no other
42 cases should be scheduled on the court's calendar for dates prior to the
43 anticipated conclusion of the trial, except by consent of all the
44 parties who appear or during adjournments pursuant to subdivision one or
45 two of this section.
46 § 20. Section 796-h of the real property actions and proceedings law,
47 as added by chapter 677 of the laws of 2022, is amended to read as
48 follows:
49 § 796-h. Judgment. 1. The court shall render a final judgment either:
50 (a) Dismissing the petition for failure to affirmatively establish the
51 allegations thereof or because of the affirmative establishment by the
52 owner or a mortgagee or lienor of record of a defense or defenses speci-
53 fied in section seven hundred ninety-six-g of this article; or
54 (b)(i) Directing that:
55 (A) the rents due on the date of the entry of such judgment from the
56 petitioning tenants and the rents due on the dates of service of the
S. 9956 16
1 judgment on all other residential and non-residential tenants occupying
2 such dwelling from such other tenants, shall be deposited with the
3 administrator appointed by the court, pursuant to section seven hundred
4 ninety-six-j of this article;
5 (B) any rents to become due in the future from all tenants occupying
6 such dwelling shall be deposited with such administrator as they come
7 due;
8 (C) such deposited rents shall be used, subject to the court's direc-
9 tion, to the extent necessary to remedy the condition or conditions or
10 course of conduct alleged in the petition; and
11 (D) upon the completion of such work in accordance with such judgment,
12 any remaining surplus shall be turned over to the owner, together with a
13 complete accounting of the rents deposited and the costs incurred; and
14 (ii) [granting] Directing the owner to provide written notice to the
15 court, court-appointed administrator, housing standards department, and
16 petitioning tenants within ten days of entering into a contract of sale
17 with a prospective purchaser of the premises; and
18 (iii) Granting such other and further relief as to the court may seem
19 just and proper.
20 2. (a) A certified copy of such judgment shall be served personally,
21 by the administrator appointed by the court pursuant to section seven
22 hundred seventy-eight of this article, upon each non-petitioning tenant
23 occupying such dwelling. If personal service on any such non-petitioning
24 tenant cannot be made with due diligence, service on such tenant shall
25 be made by affixing a certified copy of such judgment on the entrance
26 door of such tenant's apartment or other unit and, in addition, within
27 one day after such affixing, by sending a certified copy thereof by
28 certified or registered mail, return receipt requested, to such tenant.
29 (b) Any right of the owner of such dwelling to collect such rent
30 moneys from any petitioning tenant of such dwelling on or after the date
31 of entry of such judgment, and from any non-petitioning tenant of such
32 dwelling on or after the date of service of such judgment on such non-
33 petitioning tenant as herein provided, shall be void and unenforceable
34 to the extent that such petitioning or non-petitioning tenant, as the
35 case may be, has deposited such moneys with the administrator in accord-
36 ance with the terms of such judgment, regardless of whether such right
37 of the owner arises from a lease, contract, agreement or understanding
38 heretofore or hereafter made or entered into or arises as a matter of
39 law from the relationship of the parties or otherwise. It shall be a
40 valid defense in any action or proceeding against any such tenant to
41 recover possession of real property for the non-payment of rent or for
42 use or occupation to prove that the rent alleged to be unpaid was depos-
43 ited with the administrator in accordance with the terms of a judgment
44 entered under this section.
45 3. Neither the owner nor a court-appointed administrator shall, with-
46 out good cause, serve a notice to quit upon any tenant or commence any
47 action to recover real property or summary proceeding to recover
48 possession of real property, or substantially alter the terms of a
49 tenant's lease, including, but not limited to, refusing to continue a
50 tenancy of the tenant upon expiration of the tenant's lease, to renew
51 the lease or offer a new lease, or offering a new lease with a rent
52 increase equal to or greater than five percent above the current lease,
53 within one year of a judgment pursuant to this section; provided, howev-
54 er, that an owner shall not be required under this section to offer a
55 new lease or a lease renewal for a term greater than one year.
S. 9956 17
1 § 21. Section 796-i of the real property actions and proceedings law
2 is REPEALED.
3 § 22. Section 796-j of the real property actions and proceedings law,
4 as added by chapter 677 of the laws of 2022, is amended to read as
5 follows:
6 § 796-j. Appointment of administrator. 1.(a) The court is authorized
7 and empowered, in implementation of a judgment rendered pursuant to
8 section seven hundred ninety-six-h [or seven hundred ninety-six-i] of
9 this article, to appoint a person other than the owner, a mortgagee or a
10 lienor, to receive and administer the rent moneys or security deposited
11 with such owner, mortgagee or lienor, subject to the court's direction.
12 (b) The court may appoint the commissioner of the department charged
13 with enforcement of the housing maintenance code in the municipality
14 where the dwelling is located or the commissioner's designee as such
15 administrator, provided that the commissioner or the commissioner's
16 designee shall consent, in writing, to such appointment.
17 (c) Any administrator is authorized and empowered in accordance with
18 the direction of the court, to:
19 (i) order the necessary materials, labor and services to remove or
20 remedy the conditions specified in the judgment, and to make disburse-
21 ments in payment thereof;
22 (ii) demand, collect and receive the rents from the tenants of the
23 dwelling;
24 (iii) institute all necessary legal proceedings including, but not
25 limited to, summary proceedings for the removal of any tenant or
26 tenants;
27 (iv) to rent or lease for terms not exceeding three years any part of
28 said premises, however, the court may direct the administrator to rent
29 or lease commercial portions of a premises zoned for mixed commercial
30 and residential use for terms that the court may approve; and
31 (v) in accordance with the direction of the court, to accept and repay
32 such moneys as may be received from the department or departments
33 charged with enforcement of the housing maintenance code in the munici-
34 pality or municipalities where the dwelling is located for the purpose
35 of managing the premises, replacing or substantially rehabilitating
36 systems or making other repairs or capital improvements authorized by
37 the court. All moneys expended by such department or departments pursu-
38 ant to the foregoing shall constitute a debt recoverable from the owner
39 and a lien upon the building and lot, and upon the rents and other
40 income thereof.
41 (d) Upon completion of the work prescribed in such judgment, the
42 administrator, shall file with the court a full accounting of all
43 receipts and expenditures for such work. The administrator shall dispose
44 of the rents and other monies deposited with such administrator accord-
45 ing to the following order of priority:
46 (i) payment in full for all of the work specified in the judgment,
47 fuel bills, fire and liability insurance, and bills for ordinary repairs
48 and maintenance, including correcting conditions in violation of the
49 law; until all of the work specified in the judgment has been completed
50 and payment for such work has been made, no other disbursements shall be
51 permitted[, except for fuel bills, fire and liability insurance, and
52 bills for ordinary repairs and maintenance].
53 (ii) payment of a reasonable amount for the services of the adminis-
54 trator, including reimbursement of any legal fees incurred by the admin-
55 istrator in connection with management of the building.
S. 9956 18
1 (iii) payment of outstanding real property tax liens claimed by any
2 municipality in which the dwelling is located.
3 (iv) payment of outstanding emergency repair liens filed and recorded
4 by any municipality in which the dwelling is located and outstanding
5 liens filed and recorded by such municipality or municipalities pursuant
6 to this section.
7 (v) abatements for all tenants of up to twenty-five percent of rent
8 for the period during which the administrator is appointed. Nothing in
9 this paragraph shall prevent any tenant from prosecuting a claim in a
10 court of competent jurisdiction for breach of warranty of habitability;
11 however, any resulting relief from such claim will be reduced by the
12 amount of the abatement awarded herein.
13 (vi) payment to the owner of the dwelling of any surplus remaining
14 after payments of subparagraphs (i), (ii), (iii) [and], (iv) and (v) of
15 this paragraph have been made.
16 2. The court may allow from the rent moneys or security on deposit a
17 reasonable amount for services of such administrator.
18 3. The administrator shall furnish a bond, the amount and form of
19 which shall be approved by the court. In its discretion and for good
20 cause shown, the court may dispense with the necessity for a bond. The
21 cost of a required bond shall be paid from the moneys so deposited.
22 4. The administrator shall file a transcript of the judgment appoint-
23 ing [him or her] them with the clerk of the county in which the subject
24 premises is located within fifteen days of [his or her] their appoint-
25 ment.
26 5. The duties of the administrator shall not be affected by the
27 appointment of a receiver in an action to foreclose a mortgage on the
28 premises, except that the rights of the owner, including the right to
29 any surplus, pursuant to subparagraph [(v)] (vi) of paragraph (d) of
30 subdivision one of this section, shall pass to the receiver. The court
31 in which the action to foreclose a mortgage on the premises is pending
32 may appoint such administrator to serve as receiver in that action in
33 addition to [his or her] their duties as administrator pursuant to this
34 article.
35 6.(a) Such administrator shall be liable only in [his or her] their
36 official capacity for injury to persons and property by reason of condi-
37 tions of the premises in a case where an owner would have been liable;
38 [he or she] the administrator shall not have any liability in [his or
39 her] such administrator's personal capacity.
40 (b) Appointment of an administrator pursuant to subdivision one of
41 this section shall not relieve an owner of liability for injury to
42 persons and property in such case.
43 7. No municipality shall be liable to any party, including the admin-
44 istrator or the owner of the dwelling, for injury to persons or property
45 by reason of conditions of the premises or the acts or omissions of the
46 administrator.
47 8. The commissioner of the department charged with enforcement of the
48 housing maintenance code in the municipality where the dwelling is
49 located shall promulgate rules and regulations regarding criteria for
50 the selection of administrators to be appointed pursuant to this section
51 and shall establish and maintain a list of organizations and persons
52 approved by such department. Any person appointed as an administrator
53 within such municipality shall be selected from among the organizations
54 and persons approved as administrators pursuant to such list, any organ-
55 izations or individuals submitted to the court for consideration by the
56 petitioning tenants pursuant to paragraph (a) of this subdivision, and
S. 9956 19
1 the petitioning tenants deemed to have sufficient knowledge and exper-
2 tise to serve as the administrator. A city, town or village may estab-
3 lish and maintain such list itself or elect to have such list estab-
4 lished and maintained by the commissioner of the department charged with
5 enforcement of the housing maintenance code in the county in which a
6 dwelling is located.
7 (a) Where a proceeding under this article is initiated by tenants, the
8 petitioning tenants shall have the right to submit to the court a list
9 of three preferred organizations and/or individuals selected from the
10 approved list of administrators provided that, if the tenants find no
11 organization or individual on the list to be suitable, the tenants may
12 nominate organizations or individuals outside of the list, including
13 from among the petitioning tenants, along with a summary of each nomi-
14 nee's experience and credentials, for consideration by the court.
15 (b) Where petitioning tenants have submitted preferred organizations
16 and/or individuals selected from the approved list of administrators,
17 the court must appoint an administrator from among the petitioning
18 tenants' preferred approved administrators absent good cause to the
19 contrary.
20 (c) Where petitioning tenants have not submitted preferred organiza-
21 tions or individuals or where the court declines to appoint an adminis-
22 trator from among the petitioning tenants' preferred administrators or
23 nominees, priority of appointment shall be given to not-for-profit
24 corporations formed for the purpose of preserving or developing afforda-
25 ble housing whenever there is no eligible for-profit organization or
26 individual that is clearly more competent.
27 9. (a) The administrator shall, within thirty days of appointment,
28 file with the court a plan for the provision of essential services and
29 for the correction of such other hazardous conditions as may exist at
30 the premises, specifying dates by which such services shall be provided
31 and such conditions corrected. If such administrator cannot provide such
32 services and correct such conditions by the dates specified in the plan,
33 [he or she] the administrator shall be required to file with the court
34 an amendment to the plan setting forth the reasons why such services and
35 corrections could not be provided by such date and specifying new dates
36 for such services and corrections. Such plan and any amendments to such
37 plan shall be provided to the tenants by mail or by posting in a common
38 area of the building and to the owner of record by mail.
39 (b) Where an organization has been appointed as the administrator,
40 such administrator shall promptly delegate the responsibilities to a
41 single individual and inform the court of such designation within thirty
42 days. Such person shall remain accountable to the court as the adminis-
43 trator's representative until the administrator's discharge.
44 10. (a) The court may only discharge an administrator if the owner
45 makes a prima facie showing that the conditions and course of conduct
46 which required the appointment of the administrator under this article
47 have been cured and that the owner has a detailed plan for the continued
48 maintenance and operation of the dwelling, the owner has paid in full or
49 entered into a payment agreement to pay in full all outstanding real
50 property tax liens claimed by any municipality in which the dwelling is
51 located, all outstanding emergency repair liens filed and recorded by
52 any municipality in which the dwelling is located and all outstanding
53 liens filed and recorded by such municipality or municipalities pursuant
54 to this section.
55 (b) A detailed plan for the continued maintenance of the operations
56 of the dwelling shall include sufficient submissions for the court to
S. 9956 20
1 evaluate the owner's willingness and ability to make repairs, including
2 specifying the repairs they will undertake, an estimated budget, a time-
3 table for doing so, identifying the source of funds for those expendi-
4 tures, and balance sheets or income statements.
5 (c) In assessing an owner's fitness for the continued maintenance and
6 operation of the dwelling, the court shall consider the conditions of
7 other properties owned or managed by the owner and shall not discharge
8 the administrator where it is found that the owner operates a separate
9 property or separate properties at a standard which is contrary to
10 public health and safety. The court may rely on the visually displayed
11 or the printed computerized violation files of the department responsi-
12 ble for maintaining such files and all other computerized data as shall
13 be relevant to the enforcement of state and local laws for the estab-
14 lishment and maintenance of housing standards.
15 11. (a) Where a judgment has been entered pursuant to this section,
16 the municipality must, within six months of such a judgment, certify a
17 finding pursuant to paragraph (c) of subdivision one of section nineteen
18 hundred seventy-one of this chapter.
19 (b) Where a finding of abandonment has been certified, the munici-
20 pality may commence a proceeding pursuant to section nineteen hundred
21 seventy-three of this chapter, or, in the alternative, authorize the
22 court-appointed administrator to sell the property to a purchaser
23 approved by the court pursuant to section seven hundred eighty-four of
24 this article.
25 (c) Notice of such authorization must be issued to all owners, mortga-
26 gors, lienors and lessees of record pursuant to section nineteen hundred
27 seventy-two of this chapter, as well as to all tenants of the subject
28 building.
29 (d) Any owner, mortgagor, lienor or lessee may challenge the authori-
30 zation of sale, provided that the burden of proof is on the challenging
31 party to demonstrate its capacity to resume control of the premises
32 pursuant to this subdivision.
33 § 23. Section 796-k of the real property actions and proceedings law,
34 as amended by chapter 24 of the laws of 2023, is amended to read as
35 follows:
36 § 796-k. Presentation or settlement of accounts. The court shall
37 require the keeping of written accounts itemizing the receipts and
38 expenditures for work performed under an order issued pursuant to
39 section seven hundred ninety-six-h [or seven hundred ninety-six-i] of
40 this article, which shall be open to inspection by the owner of the
41 dwelling, or any mortgagee or lienor or any other person having an
42 interest in such receipts or expenditures provided, however, that
43 notwithstanding any other provision of law to the contrary, such infor-
44 mation as may be in the possession of the department charged with the
45 enforcement of the housing maintenance code of the municipality shall be
46 available from such department for inspection only by the owner of the
47 dwelling, the tenant of the dwelling, or a person having a recorded
48 interest in the property. Upon motion of the court or the administrator
49 or of the owner, any mortgagee or lienor of record or of any person
50 having an interest, or the petitioning tenants, the court may require a
51 presentation or settlement of the accounts with respect thereto. Notice
52 of a motion for presentation or settlement of such accounts shall be
53 served on the owner, any mortgagee or other lienor of record who
54 appeared in the proceeding and [any person having an interest in such
55 receipts or expenditures] the petitioning tenants.
S. 9956 21
1 § 24. Section 796-m of the real property actions and proceedings law,
2 as added by chapter 677 of the laws of 2022, is amended to read as
3 follows:
4 § 796-m. Defense of warranty of habitability inapplicable. Notwith-
5 standing any other provision of law, in any proceeding for the payment
6 of rent commenced by an administrator appointed pursuant to this arti-
7 cle, the provisions of section two hundred thirty-five-b of the real
8 property law pertaining to the warranty of habitability shall not be a
9 defense to such a proceeding for rent which accrues during the period of
10 time that a judgment or an order pursuant to this article is in effect,
11 unless the court determines that the conditions upon which such defense
12 is based were caused by the failure of such administrator to perform
13 [his or her] the administrator's duties in a reasonable manner. The
14 burden of showing performance of duties in a reasonable manner shall be
15 made by the administrator in such summary proceeding.
16 § 25. The real property actions and proceedings law is amended by
17 adding a new section 796-n to read as follows:
18 § 796-n. Waiver void. Any provision of a lease or other agreement
19 whereby any provision of this article for the benefit of a tenant, resi-
20 dent or occupant of a dwelling is waived, shall be deemed against public
21 policy and shall be void.
22 § 26. This act shall take effect on the one hundred eightieth day
23 after it shall have become a law; provided, however, that the amendments
24 to subdivision 10 of section 778 of the real property actions and
25 proceedings law made by section nine of this act shall not affect the
26 repeal of such subdivision and shall be deemed repealed therewith.
