Cuomo’s tenant-friendly settlement with Vantage raises questions

New York /
Feb.February 11, 2010 06:29 PM

Attorney General Andrew Cuomo’s settlement agreement announced today
not only forced landlord Vantage Properties to pay $1 million, but it
put all residential landlords on notice that the state’s top law
enforcement officer wants property owners to be more tenant-friendly
than the law demands.

The deal struck with Vantage forces the controversial landlord to
adhere to a three-year oversight program that will force the company
to stop serving what Cuomo described as baseless legal notices and frivolous Housing Court
actions, he said in the statement.

Cuomo was prepared to sue Vantage over the company’s alleged
harassment
of tenants following an investigation of the company, he
said.

Vantage also must pay $750,000 into a tenants’ compensation fund and
$250,000 to a legal and education fund.

Cuomo said all landlords should follow the tighter rules, which will
form a “best practices” standard in the industry.

“These reforms will put in place, for the first time, new rules of the
road governing the landlord-tenant relationship in New York,” Cuomo
said in the release. “If there are other landlords who are not living
up to these standards, they should.”

One section of the agreement gives Vantage tenants who are not on a
lease but have been paying rent in their own name for at least two
years, additional protections for their succession rights that are not
spelled out clearly in the law. Another demands a more thorough
investigation before the company starts a claim of nonpayment or
illegal residency.

David Brody, a partner at Borah, Goldstein, Altschuler, Nahins &
Goidel, who often represents landlords, said it was not appropriate to
apply the agreement’s policies to other landlords.

The settlement “is outrageous to apply to [all] landlords,” Brody
said. “[There is] no reason why other landlords who are good landlords
should be asked to give up rights that they have.”

But tenants’ rights attorney Edward Josephson, director of litigation at
South Brooklyn Legal Services, said the specificity of the agreement
sets the bar marginally higher for landlord actions. He did not
see it as a big change.

“I think this sets a new high-water mark for expectations for the
landlord,” he said. “But the overall [impact] will not be so much.”

Vantage has been criticized by elected officials and tenants groups
for their practices of aggressively forcing out tenants in order to
achieve higher rents in their apartments. Vantage owns approximately
9,500 units, many of them rent-stabilized, in Queens and Manhattan.

The company said in a statement that it wanted other landlords to
follow the same rules.

“We encourage other real estate companies to join us in implementing
these best practices, and we reaffirm Vantage’s commitment to
outstanding service and innovation on behalf of our residents,” the
company said.

Frank Ricci, director of government affairs with the landlord group
Rent Stabilization Association, said ultimately the agreement and
Cuomo’s statement did not trump the law.

“In five years will the courts be looking at a press release and a
settlement, or look at case law? They are going to look at case law,”
Ricci said.


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