Collecting Dust-Up

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In July, a state Appellate Court panel handed down a surprise decision that took the teeth out of a new but important tenant legal defense. Contrary to a federal court decision, the judges held that the federal Fair Debt Collection Practices Act wasn’t intended to apply to tenant-landlord disputes after all.

The decision dismayed tenant advocates, who had been jubilant when a U.S. Court of Appeals decided last December that because landlord lawyers are in the business of collecting unpaid rent they are effectively debt collectors, obligated to follow the federal law–including giving tenants the right to 30-day written notice of a rent demand. Under state housing law, tenants get a mere three days’ warning.

But now the federal ruling will no longer hold in the Second Department of the Appellate Court’s jurisdiction, which covers Brooklyn, Queens and Staten Island.

“I was a little surprised by [the decision],” says dejected Legal Aid attorney Derek Dalmer, who represented the tenant in the case. “In fact, I was a lot surprised by it. Part of their opinion said that if Congress had meant to cover rent demands [in the debt collection law], it would have been in the act already, which is ludicrous. Why would Congress list every type of notice to be covered? It’s a very bad decision.” Legal Aid plans to appeal. Meanwhile, in a similar pending case the state appellate court’s First Department, which covers Manhattan and the Bronx, may end up siding with the federal judges.

Tenant advocates note that whatever the fate of the decision, it may not make much difference to the great majority of tenants who must brave Housing Court without a lawyer: Few self-represented tenants know to use the fair debt law defense.

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