What a NYC landlord should do if a tenant is not paying rent?

Non-payment

A Non-payment case means that the only problem that the landlord has with the tenant is money owed (unpaid rent). If tenant pays the amount owed and keeps current on rent payments going forward – the landlord agrees that the tenant can continue to live on the premises (“as long as you pay – you stay” principle). The same also applies to a commercial tenant: once the amount owed is paid in full, and all future rent is paid timely, the tenant can continue to use the premises.

If the tenant is not able to pay – the court will evict the tenant. The court will issue a judgment of possession for the landlord, and having such judgment the landlord may evict the tenant with the help of a City Marshal. The court will also issue a money judgment for the amount of rent owed, and having a money judgment the landlord may collect the unpaid amount from the tenant.

Holdover

In a Holdover case, on the other hand, the landlord wants to terminate the tenancy and have the tenant leave the apartment regardless of whether tenant is paying rent on time or not. In other words – there must be another reason (something else than unpaid rent) why the landlord no longer wants the tenant on the premises. Such reason can be, for example, that the lease has expired and the landlord does not want to renew (this does not apply to rent‑regulated apartments), or the tenant is doing something wrong in violation of the lease (illegal activity on the premises, damaging the apartment, harassing other tenants, etc.) Holdover case is not discussed in this article.

The information below explains how a landlord can start a Non-payment case against a tenant.

Notices

Before a Non-Payment case can be started in court the landlord must give to the tenant two notices: a 5-day Notice pursuant to NY Real Property Law §235-e(d), and a 14-day Notice pursuant to NY Real Property Actions and Proceedings Law §711(2). These are two separate notices and must be provided to the tenant separately: the 5-day notice must be sent by certified mail, and the 14-day notice must be delivered to tenant (“served” on tenant) as described below in section “Service and mailing“. The notices must be written and must contain specific information required by law.

After both notices (the 5-day and the 14-day notice) were given to the tenant and the respective time periods (5 and 14 days) have run out, the landlord may start a Non‑Payment case in court against the tenant.

How to start a Non-payment case

To start a legal case the landlord needs to prepare and file with the court two documents: a Petition and a Notice of Petition. Notice of Petition is a standard form document (example see here), while the Petition is usually prepared by an attorney and must contain specific detailed information about the case [NY Real Property Actions and Proceedings Law §741].

Beginning August 18, 2024, the Petition (as well as the 14-day Notice) must attach a Good Cause Eviction law notice pursuant to NY Real Property Law § 231-c, as was mentioned above.

After the Petition and Notice of Petition are filed with the court and the required court fee (currently $46.00) is paid, the landlord must wait while the court personnel will process these documents and will issue an index number for the case (as of spring 2024 the processing time to get an index number in Brooklyn is two to three weeks, but may be faster in Manhattan and other counties).

Once the index number has been issued, the landlord must deliver a separate copy of Petition and a Notice of Petition to every adult person who lives in the apartment. When speaking about delivery of court documents (called “papers”) a special term “service” is used, so it is said that landlord must “serve” the Petition and Notice of Petition on every adult person who lives in the apartment. Please see the “Service and mailing” section below for an explanation of how service must be done.

A bit of terminology: the person who signed the lease is called a “tenant“, all other persons who live in the apartment are “occupants“. The tenant and the occupants together are called “respondents“, the landlord is called a “Petitioner“. [Technically, the person who signed the lease is a “tenant”, everyone else who lives in the apartment except tenant’s immediate family are “occupants”, NY Real Property Law §235-f].

Service and mailing

As was mentioned, there are special rules how the service of legal papers must be done, and if these rules are not followed the service will be considered “defective” and the judge can dismiss the case, so the landlord will have to start the whole process (5-day notice, 14-day notice, etc.) again from the beginning.

As was also mentioned, separate copies of the Petition and Notice of Petition must be served on the tenant and also on each adult occupant who lives in the apartment. The 14-day Notice must be served on the tenant the same way as Petition and Notice of Petition.

How to do service

The landlord can not do the service himself/herself, but must hire a licensed process service company, or simply ask a friend to do the service. The only requirement is that such person must be over 18 years old and must reside in the State of New York, and preferably should not be the landlord’s relative or a family member. The person who was asked to do service is called a “process server“. After serving the papers, the process server will have to sign an Affidavit of Service, which must be filed with the court within three days after service (more information below). Someone who is not a licensed professional process server can do service up to 5 times per year, which is usually enough for one legal case.

Personal service

If possible, the service should be done by personally delivering the papers to each person (respondent) to be served, this is called “personal service”. Personal service is the preferred way of service. The respondent need not actually take the papers from the process server, he/she can even turn around and run away. All that the process server needs to do is to come up to the person with the papers in the process server’s hand and say: “Hello Mr/Ms. Doe, here are important documents for you, please take them!”. If the respondent refuses to take the papers or even turns around and runs away – the service is still good. There is no need to visit the respondent in his/her apartment to do personal service – it can be done in the hallway or even on a street. Important: if more than one respondent is served – each respondent must receive his/her own copy of every document, so the process server must prepare (print out) as many copies as there are respondents.

Service via a ‘suitable person’

If personal service on a respondent cannot be done, the process server can still serve that person, even without a face-to-face meeting. For example, in a situation when the process server needs to serve two respondents (a tenant and an occupant) and the following happens: the process server comes up to the apartment, rings the doorbell and the occupant opens the door, but the tenant is not home. The process server gives one complete set of papers (copies of every document) to the occupant, and thus – personal service on the occupant is completed. Ideally, the process server should come again later – when the tenant is home, to have a face-to-face meeting with the tenant and to do a personal service on the tenant.

If coming the second time is not practical, the process server (after personally serving the occupant) may additionally give to the occupant a second set of papers to be delivered to the tenant when the tenant comes home. Before giving the second set the process server must ask the occupant if the occupant would agree to take it and deliver it to the tenant later. The service cannot be done if the occupant refuses to take the second copy (though, as was mentioned above, a respondent cannot refuse to take his own copy when he is being served personally). In this example, assuming the occupant agreed to take the second copy of the documents and deliver to the tenant later, the tenant is served indirectly, and the occupant who agreed to deliver the papers to the tenant is called a “suitable person”, or it is said that the papers for the tenant were “left with a person of suitable age and discretion”. To be a “suitable person” such person must live in the same apartment as the person to be served (the tenant, in our example). A guest, who is in the apartment only temporarily, and who just happened to open the door, cannot be used as a “suitable person”.

Service by affixing to the door

If the process server comes to the apartment and no one answers the door, the process server must come at least two more times – on different days and at different times of day. For example, if the first visit was on Monday during working hours (9am-5pm), the next visit should be Tuesday or Wednesday in the evening (after 6pm), and so on (more details on when to serve legal papers). If at least three visits were made, and no one opened the door – the process server may tape (“affix”) the documents to the apartment door using scotch-tape, or slide the papers under the door. (Rolling the papers into a roll and attaching to a doorknob with a rubber band is not good service, as it can be easily removed by someone before respondents can see it). If the process server needed to serve, for example, three respondents – three separate sets of copies of all papers must be taped to the door or slid under the door. This way of service is called “affixing“.

Though service by affixing or through a suitable person are acceptable ways of service, it is always recommended to try to achieve personal service whenever possible. (See the note below for the importance of personal service in case of a default judgment).

Mailing requirement

If a respondent was served by personal service – the service is complete, nothing else needs to be done. However, if any respondent was served not personally but through a suitable person or by affixing to the door – there is an additional mailing requirement: two complete sets of papers (copies of all documents) must be mailed to each respondent who was not served personally: one set by regular first-class mail, and another set – by certified mail. Such mailing must be done on the same day as delivery to the suitable person/affixing to the door, or the next day, but not later. [NY Real Property Actions and Proceedings Law §735].

Affidavit of Service must be filed

As soon as the service is done, an Affidavit of Service must be prepared and signed by the process server and filed with the court. This must be done within three days after personal service (if the respondent was served personally), or within three days after mailing (in case of a suitable-person service or affixing to the door).

The following sections outline what happens after service is completed and the Affidavit of Service is filed with the court. Basically, all further steps in the case depend on whether the tenant, after being served with the court papers, comes to court to contest the case or not. The reason for tenant not coming to court might be either because the service was not properly done and the tenant simply does not know that there is a court case against him, or the tenant knows about the case but has decided to just ignore it.

Answer

After the service is done and the Affidavit of Service is filed with the court, the tenant has 10 days to come to court and file an Answer – a document containing tenant’s “defenses” – reasons why they are not paying rent (such as something is broken/not functioning in the apartment/needs repairs, etc.)

One defense that is used very often is “defective service” defense (also called “lack of personal jurisdiction”). “Defective service” means that the tenant was not properly served with the 14-day Notice or with the Petition and Notice of Petition, in other words – the process server did not strictly follow the rules of service that were explained above. If defective service is proved in court – the judge can dismiss the case and the landlord will have to start a new case from the beginning. Thus, it is very important to make sure that the service is done exactly as required by the law.

If the tenant has filed an Answer – the court will schedule a hearing date for landlord and tenant to come to court. Currently in Brooklyn the first hearing date is scheduled approximately 3 to 4 months into the future. Very often, though, the first hearing is postponed (“adjourned“) for another 4 to 6 weeks. Thus, as of early 2024, the waiting time in Brooklyn between starting a case and the first actual hearing before a judge is approximately 5 to 6 months. In other NYC counties the timing may differ.

Appearance before a judge

At the first court appearance before a judge the landlord will be asked to submit a “zero-balance” breakdown of unpaid rent amounts, that is – how much money tenant owes in total since the beginning of the tenancy, in other words – how much is needed to bring the total unpaid balance down to zero. Such amount should also include all unpaid rent accrued after the court case was started, but cannot include any unpaid rent which should have been shown on the 14-day Notice and in the Petition, but was not included there.

Settlement

After one or several court appearances before a judge, the majority of Non-payment cases end in a settlement, meaning the landlord and the tenant reach an agreement in court, the judge approves the agreement, and the legal case is terminated.

The terms of the settlement agreement vary depending on each particular case, however, there are two most common scenarios: (1) the tenant promises to pay the amount owed over a certain time period (a fixed payment schedule maybe set in the agreement) and the landlord agrees not to continue with the court case during such time period; or (2) the tenant promises to move out (“vacate”) the apartment by a fixed date, and the landlord forgives the tenant the money owed.

If either the landlord or the tenant do not comply with the terms of the settlement agreement, the other party may ask the judge to schedule a new court hearing (to “restore the case to the court calendar”). In Brooklyn, such new hearing will usually be scheduled in one or two weeks, depending on the particular judge’s calendar. Procedurally, to request a hearing, a party needs to submit a motion or an Order to Show Cause (OSC).

Default judgment

If the tenant was served with Petition and Notice of Petition and 10 days went by but no Answer was filed by the tenant – the landlord or landlord’s attorney should file an application for a default judgment, asking the court to issue a judgment of possession for the landlord (to evict the tenant from the premises) and a money judgment for the amount of rent owed. The time limit to file for a default judgment is generally one year [CPLR 3215(a)]. After a possessory judgment is issued, the landlord will need assistance of a City Marshal to do the actual eviction.

Note: if a tenant was not served by personal delivery, it may be problematic to obtain a default money judgment against the tenant (the judgment of possession will still be issued). Therefore, as was said above, service of papers by the way of personal delivery to the respondent shall be preferred whenever possible.

© Ross Soltus, 2024

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