A second lawsuit has been filed by a small group of landlords contesting the Constitutionality of the rent reform laws called the Housing Stability and Tenant Protection Act of 2019. The Real Deal is reporting that the landlords filed a complaint led by a group of landlords including Dino, Dimos and Vasiliki Panagoulias who own a building at 38-06 29th Street in Manhattan. The named Defendants are the state of New York, the New York Division of Homes and Community Renewal, HCR’s Commissioner RuthAnne Visnauskas, the city, the city’s Rent Guidelines Board and their board members. The Complaint unlike the first one filed seeks monetary damage for individual landlords.
The Complaint alleges that the Housing Stability and Tenant Protection Act of 2019 is a “regulatory scheme” and a “regime in which tenants, not property owners, control who occupies the property, how it is used, and who may be excluded from it.” The Complaint further alleges that the law is in contrast to the Constitution’s “Contracts Clause,”. The clause bars governments from passing legislation in order to interfere with private contracts. The basis for this is because landlords are required to continue to charge preferential rent which would be lower than the legal rent until the apartment is vacated.
The first lawsuit was filed by the Rent Stabilization Association, the Community Housing Improvement Program as well as individual property owners. The Complaints legal theory for the stripping of the law was that rent law violates the Fifth Amendment’s “Takings Clause” and the Fourteenth Amendment’s “Due Process Clause.” The allegations is that the law amounts to an unjust taking because it severely limits when and how a landlord can increase rents on stabilized apartments. It would eliminate the ability of landlords to use the property and than for stabilized housing. Michael Vinocor, who is one of the named plaintiffs, states that the complaint will lead to a deterioration of the city’s housing inventory. Vincor states “My feeling is if they needed to make reforms, they could’ve done some rational reform.
HCR’s Brian Butry who is a spokesperson for the agency said in a statement “HCR has and will continue to both enforce the rent laws and investigate those who violate the law to protect tenants and the housing stock. The agency does not comment on pending litigation.”
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