A client of the firm found her decade long tenancy in jeopardy when her landlord moved before the DHCR for an Order Granting Approval to Refuse Renewal of Lease and/or to Proceed To Eviction under Section 2524.5(a)(1). That procedure is used when a landlord seeks to withdraw a residential rent unit from the market for its own business. A good faith intention must be demonstrated. After a highly contested proceeding involving numerous written submissions and two days of hearing before an Administrative Law Judge, the client, succeeded in having the landlord withdraw the proceeding because it could not establish the requisite good faith. However, even though the client was forced to expend legal fees to preserve her tenancy, and never committed any wrongdoing warranting a termination of the tenancy, the courts refused to permit the client to recover legal fees.
Legal fees require a contract or a statute permitting their recovery. Since the client’s lease, like all others we have seen, did not encompass recovery for administrative proceedings, that avenue to recovery was closed. Similarly, the fact that the hearing took place before an Administrative Law Judge at DHCR, rather than before a Civil Court Judge in the Housing Court, foreclosed the client from relying upon Real Property Law §234.
Adam Leitman Bailey and Christopher Halligan of Adam Leitman Bailey, P.C. represented the party at trial.