On the evening of June 30, 2020, Governor Andrew Cuomo signed the Tenant Safe Harbor Act, which establishes new procedures for nonpayment summary proceedings against residential tenants who can demonstrate that they suffered financial impact from the period of March 7, 2020 until the date the various governmental restrictions are lifted (“Covered Period”).
What is significant is that, unlike the previously issued Court directives, whereby the burden of investigating and determining whether a tenant was impacted financially by the pandemic was on the owner, the burden now rests on the tenant who must raise a defense of financial hardship during the Covered Period. If the tenant is able to establish such financial hardship to satisfaction of the Court, the Court is precluded from issuing a judgment of possession or a warrant of eviction (i.e. the right to evict) for the rent accrued during the Covered Period. However, the Court may still issue a money judgment (not eviction) for this unpaid rent that can be enforced against the tenant.
The factors a Court may look at, among others, in determining if the defense is established are: (i) the tenant’s income prior to the covered period, (ii) the tenant’s income during the covered period, (iii) the tenant’s liquid assets and (iv) the tenant’s eligibility for and receipt of cash assistance, supplemental nutrition assistance, supplemental security income, the New York State disability program, the home energy assistance program, or unemployment insurance or benefits under state or federal law.
Although not specifically stated, we believe that public policy and other considerations should mandate that the financial hardship be directly attributable to the Covid-19 pandemic, not merely that some non-Covid related hardship has occurred during the covered period.
There remain many procedural hurdles and substantive issues involved in commencing and pursuing a nonpayment proceeding. We recommend that you contact an attorney at Belkin Burden Goldman, LLP to discuss these issues.