By Glenn Blain
ALBANY - New York's highest court handed a victory to tenants in rent
stabilized apartments Thursday when it ruled their leases could not be
seized as assets in bankruptcy proceedings.
The Court of Appeals, in a 5-2, decision sided with a 79-year-old
Manhattan widow's argument that her rent-stabilized lease was a public
assistance benefit and not an asset that could be liquidated as part of
her bankruptcy case.
"When the rent-stabilization regulatory scheme is considered against
the backdrop of the crucial role that it plays in the lives of New York
residents, and the purpose and effect of the program, it is evident that
a tenant's rights under a rent-stabilized lease are a local public
assistance benefit," Judge Sheila Abdus-Salaam wrote in the majority
decision.
The decision stems from the bankruptcy case of Mary Veronica
Santiago-Monteverde, who has lived in her 7th St. apartment for more
than 40 years and was forced to file for bankruptcy after the death of
her husband in 2011.
During the bankruptcy proceedings, Santiago-Monteverde’s landlord
offered to purchase her interest in the lease and the bankruptcy trustee
accepted the deal.
"The decision will maintain the status quo as it has existed in New
York for decades — so that a bankruptcy filing will not disrupt the
residency of a rent-paying tenant in a rent-subsidized apartment. This
should finally put the question to rest,” said Columbia Law School
Professor Ronald Mann, who represented Santiago-Monteverde.
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