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When can a commercial tenant withhold rent in New York?

On Behalf of | Dec 18, 2022 | Real Estate Law

New York landlords have a duty to ensure that the commercial property they are leasing meets the basic health, safety and structural standards stipulated by local, state and federal laws. If this obligation is not met, the tenant may pursue applicable options. 

One of the steps the tenant may take if the landlord fails to live up to their end of the bargain is withholding rent until the repairs are made or making the repairs and deducting the cost from the rent. But under what circumstances can you withhold commercial rent in New York?

Justification for withholding rent

Before making the decision to withhold rent or use it to pay for repairs, you need to be sure that the circumstances justify your actions and that you are compliant with applicable local and state laws. Here are considerations you need to take into account when withholding rent:

  • The defects or habitability issues warrant rent withholding or repair-and-deduct. In other words, the defects in question must result from genuine wear and tear. You may not withhold or deduct rent to make repairs for damages that are your making. 
  • The nature of notice you must give the landlord as well as the amount of time they have to address the repairs before you can withhold rent or make repairs yourself before deductions. 
  • The limit on the amount of rent you can withhold or deduct and the frequency with which you can do it
  • Your protection should the landlord retaliate (by terminating the lease agreement or increasing rent) following your decision to exercise your right to withhold or deduct rent
  • Conditions relating to your lease contract such as the requirement to pay rent via an escrow account.

Everyone dreams of a cordial landlord-tenant relationship. Unfortunately, disputes happen. Understanding your legal options can help you safeguard your rights and interests while addressing a commercial lease dispute.