Save Time, Legal Fees in Housing Court with Partial Rent Agreement
At some point, you may find yourself suing a tenant in housing court to collect overdue rent and to evict the tenant if he or she doesn't pay. During the course of the case, the tenant may bring up any and all excuses to delay eviction. The tenant may claim that there are conditions in the apartment that need to be repaired or services that you haven't provided. Or the tenant may want more time to get an attorney or documents, and the tenant may ask the judge to be able to come back at a later date.
Suppose the judge granted the tenant's request and it has been 30 days or more since you and the tenant first appeared in court. Or perhaps this is the tenant's second delay request. In either situation, the state's rent deposit law under Section 745 of the state's Real Property Actions and Proceedings Law allows you to ask the judge to order the tenant to deposit the rent due with the court. But making this request is time-consuming and, unless your building has 12 or fewer units, the money doesn't go directly to you.
Instead of asking for a rent deposit, consider agreeing to the tenant's delay request, but require the tenant to pay you at least part of the rent he owes, suggests New York attorney Todd Nahins. Although tenants won't always go for this strategy, it's worth a try, he says. To help you implement this strategy, we've created Model Agreement: Agree to Delay if Tenant Pays Partial Rent, which you can adapt for your own use.
Advantages to Reaching Agreement
Reaching an agreement with the tenant, rather than asking for the rent deposit, has two major advantages, says Nahins.
Saves time and legal fees. Getting a judge to order the tenant to make a rent deposit can take time. If you or your attorney ask the judge who's presiding over your case to order the tenant to deposit rent, the judge will send you to another judge who will hear your rent deposit request, says Nahins. But that rent deposit judge probably won't hear your case immediately. You or your attorney may have to wait around until the judge can get to your request. If you leave, you run the risk of not being there when the judge is ready to hear your request.
If you're representing yourself, you may not be able to afford to spend an entire day out of the office. If you're using an attorney, you'll have to pay your attorney extra to wait around all day. These extra fees may be more than the amount the tenant will be required to deposit.
Gets money in your pocket. If your building has more than 12 units and the judge orders the tenant to deposit rent, the rent deposit law says that the money goes into a special court fund—not directly to you. You cannot get the money out of the court fund until you get a judgment in your favor in the case. But if you sign an agreement with the tenant, you can require the tenant to pay the partial rent directly to you. So even though you're not getting the full amount of rent due, the amount you do get will be in your pocket.
What Agreement Should Say
If the tenant asks for a second delay of the case, offer to agree to the delay instead of asking for a rent deposit—but only if the tenant agrees to pay a portion of the rent due directly to you, says Nahins. Note that this agreement doesn't settle the whole case. It only resolves the issue of whether the tenant can get the delay without having to deposit rent, and under what conditions.
If you and the tenant reach an agreement, you can put the terms in writing and give it to the judge. The judge must then approve the agreement. Or the judge may just note the terms of the agreement on the file, the court documents pertaining to the case. Either way, your agreement, like our Model Agreement, should include the following:
1. Your consent to delay. The agreement should state that you consent to delay the case at the tenant's request until a specified date. The delay date should not be more than one or two weeks from the date of the agreement, says Nahins. In legal terms, you are agreeing to the tenant's request for an adjournment.
2. Tenant's promise to pay part of rent due. The agreement should state that the tenant agrees to pay a specified amount of the rent owed by a specified date. This date should be before the delay date set for the case, says Nahins. That way, if the tenant doesn't pay, you can report this to the judge on the delay date.
How much rent you get the tenant to agree to pay depends on the facts of each particular case and what you can negotiate with the tenant. For example, the tenant might be claiming that he should get a 25 percent rent abatement because you allegedly didn't make certain repairs in the apartment. You may want to ask the tenant to agree to pay you the undisputed amount or 75 percent of the rent due. Sometimes, you can get the tenant to agree to pay the most recent month's rent, but not the back rent that's due, says Nahins.
3. Consequences of tenant's failure to pay promised amount. Your agreement should state what will happen if the tenant doesn't pay the agreed-upon amount by the specified date, says Nahins. Try to get the tenant to agree to a judgment in your favor for the entire amount owed in this situation, he says. This way, if the tenant doesn't pay, you can go back to the judge on the delay date and ask for a judgment in your favor for the entire amount that you claim in your court papers that the tenant owes. If the tenant doesn't pay the amount of the judgment, you should be able to get a final judgment of possession, which you need before you can evict the tenant.
4. Agreement to avoid further delay. To prevent any further delays, have the agreement state that this is the final delay the tenant may get in this case.
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