2023 New York Laws › GOB - General Obligations › Article 7 - Obligations Relating to Property Received as Security › Title 1 - Money Deposited as Security to Be Held in Trust in Certain Cases › 7-108 - Deposits Made by Tenants of Non-Rent Stabilized Dwelling Units.

§ 7-108.  Deposits  made  by  tenants  of non-rent stabilized dwelling
units.  1. This section shall apply to all dwelling units in residential
premises, unless such dwelling  unit  is  specifically  referred  to  in
section 7-107 of this title.
1-a.   Except   in  dwelling  units  subject  to  the  city  rent  and
rehabilitation law or the emergency housing rent control law, continuing
care retirement communities licensed pursuant to  article  forty-six  or
forty-six-A of the public health law, assisted living providers licensed
pursuant  to  article  forty-six-B  of the public health law, adult care
facilities licensed pursuant to article seven  of  the  social  services
law, senior residential communities that have submitted an offering plan
to  the  attorney  general,  or  not-for-profit  independent  retirement
communities  that  offer  personal  emergency  response,   housekeeping,
transportation and meals to their residents:
(a) No deposit or advance shall exceed the amount of one month's rent,
unless  the  deposit  or  advance is for a seasonal use dwelling unit as
provided for in subdivisions four and five of this  section,  or  unless
the deposit or advance is for an owner-occupied cooperative apartment as
provided for in subdivision six of this section.
(b) The entire amount of the deposit or advance shall be refundable to
the  tenant  upon  the  tenant's  vacating of the premises except for an
amount lawfully retained for the reasonable and itemized  costs  due  to
non-payment  of rent, damage caused by the tenant beyond normal wear and
tear, non-payment of utility charges payable directly  to  the  landlord
under  the  terms of the lease or tenancy, and moving and storage of the
tenant's belongings. The landlord may  not  retain  any  amount  of  the
deposit  for  costs  relating  to ordinary wear and tear of occupancy or
damage caused by a prior tenant.
(c)  After  initial  lease  signing  but  before  the  tenant   begins
occupancy,  the  landlord  shall  offer  the  tenant  the opportunity to
inspect the premises with  the  landlord  or  the  landlord's  agent  to
determine  the  condition  of  the property. If the tenant requests such
inspection, the parties shall execute a  written  agreement  before  the
tenant  begins  occupancy  of the unit attesting to the condition of the
property and specifically noting any existing defects or  damages.  Upon
the  tenant's  vacating of the premises, the landlord may not retain any
amount of the deposit or advance due to any condition, defect, or damage
noted in such agreement. The agreement shall be admissible  as  evidence
of  the  condition of the premises at the beginning of occupancy only in
proceedings related to the return or amount of the security deposit.
(d) Within a reasonable time  after  notification  of  either  party's
intention  to  terminate  the  tenancy, unless the tenant terminates the
tenancy with less than two weeks' notice, the landlord shall notify  the
tenant  in writing of the tenant's right to request an inspection before
vacating the premises and of the tenant's right to  be  present  at  the
inspection.  If  the  tenant requests such an inspection, the inspection
shall be made no earlier than two weeks  and  no  later  than  one  week
before  the  end  of  the  tenancy.  The landlord shall provide at least
forty-eight hours written notice of the date and time of the inspection.
After the inspection, the landlord shall  provide  the  tenant  with  an
itemized  statement  specifying repairs or cleaning that are proposed to
be the basis of any deductions from the  tenant's  deposit.  The  tenant
shall  have the opportunity to cure any such condition before the end of
the tenancy. Any statement produced pursuant  to  this  paragraph  shall
only be admissible in proceedings related to the return or amount of the
security deposit.
(e)  Within  fourteen  days after the tenant has vacated the premises,
the landlord  shall  provide  the  tenant  with  an  itemized  statement

indicating the basis for the amount of the deposit retained, if any, and
shall  return  any  remaining portion of the deposit to the tenant. If a
landlord fails to provide the tenant  with  the  statement  and  deposit
within fourteen days, the landlord shall forfeit any right to retain any
portion of the deposit.
(f)  In any action or proceeding disputing the amount of any amount of
the deposit retained, the landlord shall bear the burden of proof as  to
the reasonableness of the amount retained.
(g)  Any  person who violates the provisions of this subdivision shall
be liable for actual damages, provided a person found to have  willfully
violated  this subdivision shall be liable for punitive damages of up to
twice the amount of the deposit or advance.
2. (a) In circumstances where any sum of money or any other  thing  of
value  deposited as security for the full performance by a tenant of the
terms of his lease is  not  turned  over  to  a  successor  in  interest
pursuant  to  section  7-105 of this chapter, the grantee or assignee of
the leased premises shall also be liable to such tenant, upon conveyance
of such leased premises, for the repayment of any such security deposit,
plus accrued interest, as to which such grantee or assignee  has  actual
knowledge.
(b)  For purposes of this section, a grantee or assignee of the leased
premises shall be deemed  to  have  actual  knowledge  of  any  security
deposit  which  is  (i)  deposited  at  any  time  during the six months
immediately prior to closing or other transfer of title in  any  banking
organization  pursuant  to  subdivision  two-a  of section 7-103 of this
chapter, or (ii) acknowledged in any lease in  effect  at  the  time  of
closing  or  other  transfer of title, or (iii) supported by documentary
evidence provided by the tenant or lessee as set forth in paragraph  (c)
of this subdivision.
(c)  With  respect to any leased premises for which there is no record
of security deposit pursuant to subparagraph (i) or  (ii)  of  paragraph
(b)  of this subdivision, the grantee or assignee of the leased premises
shall be obligated to notify the tenant thereof in writing no later than
thirty days following the closing or other transfer of title to the fact
that there is no record of a security deposit for said  leased  premises
and  that  unless  the  tenant within thirty days after receiving notice
provides him or it with documentary  evidence  of  deposit,  the  tenant
shall  have  no  further  recourse  against  him or it for said security
deposit. For purposes of this subdivision, "documentary evidence"  shall
be limited to any cancelled check drawn to the order of, a receipt from,
or  a lease signed by any predecessor in interest, if such predecessor's
interest in the leased premises existed on or after the  effective  date
of  this  section. Except as otherwise provided by subparagraphs (i) and
(ii) of paragraph (b) of this subdivision the grantee or assignee of the
leased premises shall not  be  charged  with  actual  knowledge  of  the
security  deposit where the tenant fails within the thirty-day period to
provide said documentary evidence. Where the grantee or assignee of  the
leased  premises  fails  to  notify  the  tenant  as  specified  in this
paragraph within thirty days following the closing or other transfer  of
title,  the  tenant shall be entitled to produce documentary evidence at
any time.
(d) The grantee or assignee of the  leased  premises  shall  have  the
right to demand that the grantor or assignor thereof establish an escrow
account  equal  to  one  month's  rent for any leased premises for which
there is no record of a security deposit pursuant to  paragraph  (b)  of
this  subdivision  to  be  used  for the purpose of holding harmless the
grantee or assignee in any case where,  at  a  date  subsequent  to  the

closing  or other transfer of title, the tenant gives notice pursuant to
paragraph (c) of this subdivision.
(e)  The  liability  of a receiver for payment of any security deposit
plus accrued interest pursuant to this subdivision shall be  limited  to
the amount of such deposit actually turned over to him or it pursuant to
subdivision  one  of  section 7-105 of this chapter and to the operating
income in excess of expenses generated  during  his  or  its  period  of
receivership.
3.  Any  agreement  by  a  lessee  or  tenant of a dwelling waiving or
modifying his rights as set forth in this section  shall  be  absolutely
void.
4.  A  dwelling unit shall qualify as a seasonal use dwelling unit for
the purpose of paragraph (a) of subdivision one-a of this section if  it
meets all of the following conditions:
(a)  The  lease  expressly  provides  that:  (i)  the dwelling unit is
registered as a seasonal use dwelling  unit,  indicating  the  local  or
county government agency with which it is registered; (ii) the occupancy
of  the tenant is only for seasonal use not to exceed one hundred twenty
days or a shorter period provided for  in  the  lease;  and  (iii)  such
tenant  has  a  primary  residence to return to, the address of which is
expressly provided in the lease.
(b) Such dwelling  unit  is  registered  with  the  appropriate  local
government or county registry as a seasonal use dwelling as provided for
in subdivision five of this section.
(c)  Such  dwelling unit is not rented as a seasonal use dwelling unit
for more than one hundred twenty days during each calendar year.
5. In order for a dwelling unit to qualify as a seasonal use  dwelling
unit  for  the  purpose  of  paragraph  (a) of subdivision one-a of this
section,  the  local   government   with   jurisdiction   for   building
administration  over  such  unit  or  the  county  in which such unit is
located shall have adopted a seasonal use  dwelling  unit  registry  and
such unit shall be registered by filing a copy of the seasonal use lease
and  such  additional information as the local government or county that
administers such registry may require. Such local government  or  county
shall revoke the seasonal use dwelling unit registration of any dwelling
unit  that does not adhere to the conditions provided for in subdivision
four of this section.
6. A dwelling unit shall  qualify  as  an  owner-occupied  cooperative
apartment  for the purpose of paragraph (a) of subdivision one-a of this
section if it meets all of the following conditions:
(a) the tenant is the dwelling unit owner, purchaser or shareholder of
such a cooperative housing corporation;
(b) such tenant has or will have after purchase exclusive occupancy of
such  dwelling  unit  individually  and  with  the  permitted  occupants
pursuant  to  a proprietary lease or occupancy agreement and established
and delimited rights under such lease or agreement; and
(c) such dwelling unit is not subject to  the  provisions  of  article
two,  article  four,  article  five,  or  article  eleven of the private
housing finance law. For the purposes of  this  paragraph,  "deposit  or
advance", as used in paragraph (a) of subdivision one-a of this section,
shall not include any payments or advances that are part of the purchase
price of the unit or shares.