Prohibits residential landlords from charging tenants a fee for a dishonored rent check in excess of the actual costs or fees incurred by such landlord as a result thereof, the official text

S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   56--B
                                                          Cal. No. 11
 
                        2025-2026 Regular Sessions
 
                           I N  A S S E M B L Y
 
                                (PREFILED)
 
                              January 8, 2025
                                ___________
 
 Introduced  by  M.  of  A.  EPSTEIN,  BURDICK, GALLAGHER, KELLES, GLICK,
   REYES,  CUNNINGHAM,  RAGA,   CRUZ,   SEAWRIGHT,   DAVILA,   LEVENBERG,
   BICHOTTE HERMELYN,  SCHIAVONI,  LEE  -- Multi-Sponsored by -- M. of A.
   SIMON -- read once  and  referred  to  the  Committee  on  Housing  --
   reported  from  committee,  advanced  to  a third reading, amended and
   ordered reprinted, retaining its place on the order of  third  reading
   --  passed  by Assembly and delivered to the Senate, recalled from the
   Senate, vote reconsidered, bill amended, ordered reprinted,  retaining
   its place on the order of third reading
 
 AN  ACT  to amend the real property law and the general obligations law,
   in relation to prohibiting residential landlords from charging tenants
   a fee for a dishonored rent check in excess of  the  actual  costs  or
   fees incurred by such landlord as a result thereof
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 238-a of the real property law is amended by adding
 a new subdivision 2-a to read as follows:
   2-A. (A) NO LANDLORD, LESSOR, SUB-LESSOR OR GRANTOR SHALL  DEMAND  ANY
 PAYMENT, FEE, OR CHARGE FROM A TENANT FOR THE DELIVERY OF A CHECK, DRAFT
 OR  LIKE  INSTRUMENT THAT WAS GIVEN IN PAYMENT FOR RENT AND SUBSEQUENTLY
 DISHONORED BY THE TENANT'S FINANCIAL INSTITUTION FOR INSUFFICIENT  FUNDS
 EXCEPT AS PROVIDED IN PARAGRAPH (B) OF THIS SUBDIVISION.
   (B) NOTWITHSTANDING ANY CONTRARY PROVISION HEREIN, A LANDLORD, LESSOR,
 SUB-LESSOR  OR  GRANTOR  MAY  DEMAND  ANY PAYMENT, FEE, OR CHARGE FROM A
 TENANT FOR THE DELIVERY OF A DISHONORED CHECK ONLY IF SUCH PAYMENT, FEE,
 OR CHARGE WAS PROVIDED FOR IN THE LEASE OR  CONTRACT  BETWEEN  LANDLORD,
 LESSOR, SUB-LESSOR OR GRANTOR AND THE TENANT; PROVIDED, HOWEVER, THAT:
   (I)  SUCH  PAYMENT,  FEE, OR CHARGE SHALL NOT EXCEED THE ACTUAL COSTS,
 CHARGES OR FEES INCURRED BY LANDLORD, LESSOR, SUB-LESSOR OR GRANTOR  FOR
 THE  RETURN OF SUCH DISHONORED CHECK OR THE AMOUNT SET FORTH IN SUBDIVI-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD00565-07-5
 A. 56--B                            2
 
 SION THREE OF SECTION 5-328 OF THE GENERAL OBLIGATIONS LAW, WHICHEVER IS
 GREATER; AND
   (II)  IF  THE  PAYMENT,  FEE OR CHARGE EXCEEDS THE AMOUNT SET FORTH IN
 SUBDIVISION THREE OF SECTION 5-328 OF THE GENERAL OBLIGATIONS  LAW,  THE
 LANDLORD, LESSOR, SUB-LESSOR OR GRANTOR SHALL PROVIDE TO THE TENANT UPON
 REQUEST EVIDENCE SUBSTANTIATING THE EQUIVALENCE BETWEEN THE PAYMENT, FEE
 OR  CHARGE  AND THE AMOUNT OF ACTUAL COSTS, CHARGES OR FEES INCURRED FOR
 THE RETURN OF THE DISHONORED CHECK.
   (C) AS USED IN THIS SUBDIVISION, "DISHONORED  CHECK"  SHALL  HAVE  THE
 SAME  MEANING  AS  SUCH  TERM IS DEFINED IN SECTION 5-328 OF THE GENERAL
 OBLIGATIONS LAW.
   (D) THE PROVISIONS OF THIS SUBDIVISION SHALL NOT APPLY TO A SHAREHOLD-
 ER OF A COOPERATIVE HOUSING CORPORATION,  PROVIDED,  HOWEVER,  THAT  THE
 PROVISIONS OF THIS SUBDIVISION SHALL APPLY WITH RESPECT TO ANY TENANT OR
 SUBTENANT OF SUCH A SHAREHOLDER.
   § 2. Subdivision 3 of section 5-328 of the general obligations law, as
 added by chapter 529 of the laws of 1995, is amended to read as follows:
   3.  (A) Notwithstanding any other provision of law, any person to whom
 a check, draft or like instrument, other than a money order, bank  cash-
 ier's  check  or certified check, is tendered for any transaction, other
 than a consumer transaction,  may,  if  such  instrument  is  dishonored
 charge  or collect from the maker or drawer the amount of twenty dollars
 for the return of such unpaid or dishonored instrument.
   (B) NOTWITHSTANDING ANY OTHER PROVISION OF THIS SUBDIVISION,  A  LAND-
 LORD,  LESSOR,  SUB-LESSOR  OR  GRANTOR  TO  WHOM A CHECK, DRAFT OR LIKE
 INSTRUMENT, OTHER THAN A MONEY ORDER, BANK CASHIER'S CHECK OR  CERTIFIED
 CHECK,  IS  TENDERED  FOR  PAYMENT  OF  RENT,  MAY IF SUCH INSTRUMENT IS
 DISHONORED CHARGE OR COLLECT FROM THE MAKER  OR  DRAWER  THE  AMOUNT  OF
 ACTUAL  COSTS,  CHARGES  OR FEES INCURRED BY SUCH LANDLORD, LESSOR, SUB-
 LESSOR OR GRANTOR FOR THE RETURN OF SUCH DISHONORED CHECK OR THE  AMOUNT
 SET  FORTH  IN  PARAGRAPH (A) OF THIS SUBDIVISION, WHICHEVER IS GREATER,
 PROVIDED THAT:
   (I) IF THE PAYMENT, FEE OR CHARGE EXCEEDS  THE  AMOUNT  SET  FORTH  IN
 PARAGRAPH  (A)  OF  THIS SUBDIVISION THE LANDLORD, LESSOR, SUB-LESSOR OR
 GRANTOR SHALL PROVIDE TO THE TENANT UPON REQUEST EVIDENCE SUBSTANTIATING
 THE EQUIVALENCE BETWEEN THE PAYMENT, FEE OR CHARGE  AND  THE  AMOUNT  OF
 ACTUAL  COSTS, CHARGES OR FEES INCURRED FOR THE RETURN OF THE DISHONORED
 CHECK; AND
   (II) SUCH DISHONORED CHECK CHARGE WAS  CONTRACTED  FOR  IN  THE  LEASE
 AGREEMENT BETWEEN THE TENANT AND LANDLORD, LESSOR, SUB-LESSOR OR GRANTOR
 IN  ACCORDANCE WITH THE REQUIREMENTS OF SUBDIVISION TWO-A OF SECTION TWO
 HUNDRED THIRTY-EIGHT-A OF THE REAL PROPERTY LAW. THE PROVISIONS OF  THIS
 PARAGRAPH  SHALL  NOT  APPLY  TO  A SHAREHOLDER OF A COOPERATIVE HOUSING
 CORPORATION, PROVIDED, HOWEVER, THAT THE PROVISIONS  OF  THIS  PARAGRAPH
 SHALL APPLY WITH RESPECT TO ANY TENANT OR SUBTENANT OF SUCH A SHAREHOLD-
 ER.
   § 3. This act shall take effect immediately and shall apply to actions
 and proceedings commenced on and after such effective date.