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What’s the Penalty for Renting an Illegal Apartment?

Suffolk County District Court, Second District - Lindenhurst, NY
Suffolk County District Court, Second District - Lindenhurst, NY

Renting an illegal apartment can lead to serious consequences, but it may not be what you think. 

Landlord-tenant regulations on Long Island can be complicated. Landlords and tenants are often unaware of the laws and regulations in their area regarding illegal apartments. 

If you’re thinking of renting an illegal apartment, you may have some questions. In this article, we’ll discuss the penalties for renting an illegal apartment, how to identify illegal apartments, and ways to protect yourself from getting caught up in such a situation.

What Makes an Apartment Illegal in NY?

An apartment is considered illegal in New York if it doesn’t comply with building codes and the NY State Multiple Dwelling Law. This means that the dwelling must have adequate heating, plumbing, sanitation and a fire escape. This also applies to any rental unit regardless of whether or not it has been certified by the town as legally habitable. Generally, properties that have not passed code enforcement inspections and do not meet minimum safety standards are considered illegal dwellings. These dwellings usually lack legal residential certifications, proper zoning, and occupancy permits or other licenses required by Nassau or Suffolk County.

Common types of illegal apartments include:

  • Basement Apartments,
  • Attic Apartments
  • Garage Apartments,
  • Single-room occupancy (SRO) units
  • Unpermitted Additions or Conversions to Single-Family Homes

Can a Landlord Collect Rent on an Illegal Apartment in Nassau County or Suffolk County?

The simple answer is YES.

Before 2010, the courts on Long Island were split on this issue. At that time, the Nassau County District Court generally held that a tenant could still be evicted from an illegal apartment, but the landlord was not entitled to collect a money judgment against the tenant. The Suffolk County District Courts traditionally had a much more strict approach. The lack of a rental permit used to result in the dismissal of any non-payment proceedings.

All of this changed in 2010, when the Supreme Court, Appellate Term, Second Department, decided the case of Pickering v Chappe, 2010 NY Slip Op 20326 (29 Misc 3d 6) on August 2, 2010. The Appellate Term held that “there is no bar to the recovery of rent when a dwelling that has a certificate of occupancy as a one-family dwelling contains an illegal apartment. It is only in the Multiple Dwelling Law that the Legislature has seen fit to impose a forfeiture of rent as a penalty.”

In other words, if there are fewer than three apartments in a one-family house, the landlord can still collect rent, even if the apartment is in an illegal unit. The landlord can also still collect rent even if there’s no certificate of occupancy, as long as less than three families are living in the premises.

Is Having an Illegal Apartment a Defense to an Eviction Proceeding?

Where the penalty for the landlord comes in is with town ordinances, not with the court. The town may require all landlords to apply for rental permits. And if a landlord refuses, the town may issue fines to the landlord for renting an illegal apartment.

In other words, the penalty is not with the courts. The penalty is with the town. And as such, whether the apartment is legal or not has no bearing on your eviction proceeding. You still have to abide by your rental agreement. The fact that your apartment is illegal is not a defense for failure to pay rent.

Can a Landlord Get in Trouble for Renting an Illegal Apartment?

The Pickering case doesn’t mean landlords can unlawfully violate town ordinances. Landlords can be subject to fines from the town for renting their property without a valid rental permit. It just means there is no bar to collecting rent and no grounds for dismissing a non-payment action based on renting an illegal apartment.

What Kind of Fines will a Landlord Face for Renting an Illegal Apartment?

The fines that a landlord can face for renting an illegal apartment varies by town.

For example, the penalty for renting an illegal apartment in Suffolk County NY typically ranges from $500 to $2,500.

According to the town of Babylon town code, a first offense for a landlord renting out an illegal apartment in the Town of Babylon can be punishable by “..a fine of at least $500 but not more than $1,000 and/or imprisonment for a period not to exceed 15 days, or both. A second offense based on a violation of this article committed within five years of the first offense shall be punishable by a fine of not less than $1,000 and not more than $1,500 and/or imprisonment for a period not to exceed 15 days, or both. A third or subsequent offense based on a violation of this article committed within five years of the first offense shall be punishable by a fine of not less than $1,500 and not more than $2,500 and/or imprisonment for a period not to exceed 15 days, or both.”

 Can I Sue My Landlord for Renting an Illegal Apartment?

Well, technically anyone can sue anyone for anything nowadays. The question to ask is, do you have a legitimate cause of action? And in order to have a cause of action, you have to be able to prove damages. That you were harmed in some way. Were you somehow harmed because the apartment you were living in didn’t have a piece of paper from the town? Probably not. 

For tenants, there’s no real remedy here. If you choose to rent an illegal apartment, just know that you will still be responsible for abiding by the terms of the rental, which includes timely paying the rent. 

Picture of Michelle Murtha, Esq.

Michelle Murtha, Esq.

Michelle Murtha is the managing member of the Long Island Eviction Law Firm, PLLC, and has been a fearless litigator fighting for her client's rights for almost 20 years. You can lean more about her on our landlord-tenant lawyers page.

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