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Transitional Housing Arrangements Are Not Illusory Tenancies
The Appellate Division Second Department recently issued a landmark ruling in Sapp et al v. Clark Wilson et al, __ AD3d __, 2022 NY Slip Op 04184 (2nd Dept. 2022) (Sapp) concerning two hot button issues; namely illusory subtenancies and status of transitional occupants.
In a 3-1 decision dated June 29, 2022, containing a vigorous dissent, the majority both affirmed a lower court ruling that occupants entering into possession pursuant to transitional housing agreements are not tenants with standing to claim rent stabilized rights and that such transitional housing agreements are not, per se, illusory subtenancy schemes designed to extract rents beyond the legal regulated rents.
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