A Chronic Non-Payment Holdover Proceeding Fails

This author has written extensively about chronic non-payment proceedings and the quirks associated with such cases. A decision handed down yesterday by the Appellate Term, First Department demonstrates that a chronic non-payment proceeding will fail when a tenant shows that his/her failing to pay the rent was caused by the landlord’s failure to perform repairs. Chama Holding Corp. v. Taylor, 2012 NY Slip Op 22255 (1st Dept. App.Term 2012).

In Chama a landlord had commenced a chronic non-payment proceeding because the landlord had started four non-payment proceedings against the tenant over a 3 1/2 year period. After the holdover proceeding was started the tenant sought summary judgment claiming that in at least 2 of the 4 prior non-payment proceedings that the reason for not paying the rent was to force the landlord to perform repairs. The resolution of those 2 non-payment proceedings saw the landlord receive less than the amount sought and a requirement that the landlord perform repairs.

The Appellate Term affirmed the holding of the Housing Court in determining that the remaining two non-payment proceedings were not enough to permit the tenant’s eviction. The case was dismissed and the tenant awarded judgment as a matter of law.

The lesson to be learned for landlords is that when deciding to commence a chronic non-payment proceeding, the landlord should review each non-payment proceeding and see if the tenant had a valid defense. A non-payment proceeding in and of itself is not an element of the holdover proceeding – it is that a non-payment proceeding was started because the tenant had no justification for the failure to pay the rent.