A Policy About Face
In January of 2015, the New York City Loft Board, in a 180 degree about face from 30 years of past policy, altered its interpretation of the Loft Board Rules without notice or comment, without offering even the slightest hint of reasoned analysis to justify the change, and without any mention whatsoever of the reliance interests of good faith actors who were party to the cases involved. The issue? Who can and who cannot be protected under the Loft Law, a law originally passed by the New York State Legislature in 1982 with the express purpose of legalizing previuously illegal loft units and buildings in commercial, industrial or manufacturing spaces that thousands of New York City residents called home.
In so changing these rules — retroactively to apply to pending cases no less, thereby depriving the affected Loft tenants of their right to due process — rules having to do with an obscure Loft Law concept known as “Protected Occupancy,” the Loft Board took it upon itself to disqualify from eligibility for protection almost certainly more than 50% of those who would previously have been eligible for coverage and protection under the Loft law.
This 50% figure, of course, applies only to Loft tenants who even bothered to apply once it became clear to the Loft tenant community and its champions that almost no one could be protected under the new Loft Board rules. At least one attorney known to the author of this piece, in fact, began to advise Loft tenants not to apply for Loft Law coverage.
An Exclusion Found Nowhere in the Rules or the Legislation was Interposed into the Rules…
Whereas prior to 2015 all residential occupants of a loft were automatically deemed to be protected occupants, an interpretation of the Law repeatedly upheld by the NY State judiciary (see for example Dworkin v. Duncan, Civ. Ct. NYC, NY County, 1982), after January 2015 only the prime lessee was covered so long as he or she could show that the unit in question was his or her primary residence.
… Even as a New Requirement, also Found Nowhere in the Rules or the Legislation was also interposed into the Rules.
And whereas previously it was only necessary to show primary residence in instances where there was a dispute over possession of a unit between a residential occupant and an absentee prime lessee or de facto prime lessee, now the prime lessee (but, oddly enough, not the de facto prime lessee if he or she was living in the unit) was expected to show primary residence as a general eligibility requirement, a general eligibility requirement found nowhere in the rules or the legislation that also contravened past decisions handed down by the NY State judiciary (see, for example, BOR Realty v. the NYC Loft Board, Court of Appeals, 1987 and Schenkman v. Dole, First Dept., 1989)
That such a requirement was left out of both rules and legislation is eminently reasonable since one of the primary motivations for passing the Loft Law in the first place was to afford Loft tenants proper legal standing in order that their safety and well being might be protected in similar manner to the protections afforded other NYC residents.
A primary residence requirement would have been anathema to that goal, given the inherently illegal nature of Loft tenant occupancies since 1) they were based on illegal sham leases, and 2) a precondition for obtaining a Loft Space, in many instances, given the illegal nature of the occupancy, was to implicitly or explicitly agree to hide one’s unit as one’s primary residence.
As such, not only did these interpretive rule changes by administrative fiat constitute an entirely inappropriate and unlawful overruling of the NY state judiciary, but they were also against clearly stated legislative purpose and intent as expressed in § 280 of Article 7-C of the Multiple Dwelling Law. Such purpose and intent can quite simply be paraphrased thusly:
KEEP LOFT TENANTS SAFELY IN THEIR HOMES
COMING SOON: The Billion Dollar Loft Board (Part II)
Disclaimer: The writer of this piece is not an attorney