D&R Realty Associates, Claimant(s), v. JUDAH LEVENSON (2026)

Upon the bench trial of this case held July 28, 2026, the Decision/ Order of this court is as follows:

Appearing for Plaintiff - Ronen Flancraich - President of D & R Realty, pro se

Appearing for Defendants- Jeffrey Lichtman, Esq. (O'Hare Parnagian, LLP)

BACKGROUND

Plaintiff commenced this action on May 26, 2026, seeking to recover the sum of $10,000 for the alleged breach of lease agreement by defendants; for prematurely terminating their lease. Defendants counterclaimed for the same $10,000 for the alleged willful refusal to return their security deposit, which sum includes punitive damages.¹ Plaintiff has only one witness, its President, Ronen Flancraich. Both defendants testified for the defense.

Defendants, who appear to be a couple, rented an apartment from plaintiff in or around June of 2021 for a starting monthly payment of $3,350. The apartment was in a multiple dwelling building but not rent stabilized. The apartment has street address of 357 16th Street, 1L, Brooklyn NY 11215. The lease was renewed several times thereafter, with the rent ending up being $3,600 by the time they vacated in 2025. However, the defendants only have $3,350 in security deposit which never increased. The lease was renewed again in or around July 2025, to end in June of 2026. It is undisputed that somewhere around July or August of 2025, the defendants notified plaintiff, in writing, several times, that they intend to vacate the apartment by end of October 2025. There is ample evidence that defendants gave plaintiff multiple notices, in writing and in-person, of their intention to move out, more than one month in advance of the intended move-out date.

There is also ample undisputed evidence, and admission by plaintiff, that defendants recommended/presented at least five (5) separate couples to take over the remainder of their lease period, but plaintiff rejected all five couples, offering different reasons. His reasons range from "they have poor credit" to "my neighbor is a drug dealer, so I do not want any young person as a tenant" to "my house has lead paint, so I do not want any couple with a child".

Strikingly, when asked if he ran the credit report/history of these individuals recommended for assignment of the lease, plaintiff responded that it is not his job to run credit checks on potential tenants, that it is the job of the individuals or their real estate agents to run the checks. In other words, he did not run a credit check but believed by instinct that three or four of the recommended couples have unqualifying or bad credit standings.

In the case of a couple with a child, plaintiff refused to give his approval/consent, stating that his house is laced with lead paint and as such would be very dangerous to the child. He makes this statement without evidentiary support for the claim. In fact, defendants who lived in the apartment for over 4 years countered that no such lead paint was in the house. Plaintiff offered nothing by way of rebuttal.

At the end, defendants moved out at end of October 2025, with no assignment of the remainder of their lease, because plaintiff rejected all five couples recommended for same.

Plaintiff claims that defendants broke their lease (breached their lease agreement) when they vacated the premises, without assigning the remainder of their lease and therefore they owe him rent from November 2025 to January 2026, a period of three (3) months at $3,600 per month. This is because plaintiff testified that he re-let the space in February of 2026. Defendants credibly testified that they are very much aware that the space was re-let in January of 2026, which plaintiff did not refute.

Although, plaintiff claimed that the place was re-let in February of 2026, as opposed to January of 2026, but when asked to produce the new lease to ascertain this information, he refused to do so. The court credits defendants testimony that the space had occupant(s) in January of 2026.

Defendants filed a Counterclaim in this action, which is for the return of their security deposit in the amount of $3,350 plus double that amount in punitive damages, for the willful violation of the law, pursuant to Gen. Oblg. Law § 7-108(1-a)(g). Defendants testified that plaintiff was invited severally to conduct an inspection of the premises before they vacated, but that he refused to do so.

DISCUSSION

a. Real Property Actions Proceedings Law ("RPAPL") § 226-b

As relied upon by defendants, RPAPL § 226-B prescribes:

Unless a greater right to assign is conferred by the lease, a tenant renting a residence may not assign his lease without the written consent of the owner, which consent may be unconditionally withheld without cause provided that the owner shall release the tenant from the lease upon request of the tenant upon thirty days notice if the owner unreasonably withholds consent which release shall be the sole remedy of the tenant. If the owner reasonably withholds consent, there shall be no assignment and the tenant shall not be released from the lease.

It is undisputed that defendants attempted, multiple times to assign their lease, and provided at least five potential assignees, but plaintiff withheld his consent, which he is allowed to do without cause under the above statute. However, the statute further states "the owner shall release the tenant from the lease upon request of the tenant upon thirty days notice if the owner unreasonably withholds consent which release shall be the sole remedy of the tenant"

Here, the court finds that; (1) defendants have duly complied with the requirements of RPAPL 226-b by giving timely notice of their intentions to vacate the premises and recommending/offering five separate potential assignees to take over the remainder of their the lease; (2) plaintiff unreasonably withheld his consent to assign the lease, as set forth hereinabove; (3) defendants were within their rights to vacate the premises without an assignment of same, having given plaintiff 30 days of notice of termination.

Thus, pursuant to RPAPL § 226-B, the defendants were assumed released from the lease by the operation of this law and therefore not responsible to plaintiff for any damages suffered as a result of the lack of assignment of the lease. See Palmer v. 309 E. 87th St. Co., 112 Misc 2d 667, 676, 447 N.Y.S.2d 1000, 1005 (Sup. Ct. 1982). See also WG Three Associates, LLC v. Portofino Chelsea, LLC 179 AD3d 604, 114 NYS.3d 648 (1st Dept. 2020) (holding that the subsequent offer of the same lease directly to the proposed assignee at a higher rent is evidence that plaintiff unreasonably withheld its consent, and that defendants are entitled to damages for the amount paid by defendants in rent after plaintiff unreasonably withheld its consent to the assignment)

b. General Obligations Law § 7-108

As relied upon by defendants, Gen. Oblg. Law § 7-108 prescribes:

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)(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.

(1-a)(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

It is undisputed that plaintiff did not return defendant's security deposit after they vacated the premises. It is also undisputed that plaintiff did not provide an itemized statement to defendant within 14 days of vacating the premises, indicating the basis for retaining any portion of the deposit. The issue before this court is whether in so acting plaintiff willfully violated GOL § 7-108 and therefore liable to defendants for punitive damages.

In most of the cases applying this law, the issues usually revolve around timeliness of the landlord in providing the itemized statement or a complete failure to do so. See Cohen v Abruzzo, 228 AD3d 724, 213 N.Y.S.3d 169 (2nd Dept. 2024). However, in the within case, the landlord's (plaintiff) position is that defendants broke their lease and therefore are not entitled to the return of their deposit and even owe for the remainder of their lease.

This court finds that the plaintiff did not willfully violate this law and therefore may not be subjected to punitive damages. Here, plaintiff not only withheld the deposit in the mistaken belief that he is entitled to it but also brought this action to recover the balance of the lease term. Under the facts of this case, it is quite logical for plaintiff to believe that he is entitled to retain the deposit without providing a statement to the defendants. This cannot be said to be a 'willful violation' of this law. He may also have believed that providing itemized statement may unwittingly convey consent to vacate the premises without assignment.

The statute did not provide a definition of, nor explain what would constitute 'willful violation', but according to the caselaw, the mere violation of the statute alone, without further, does not, in and of itself, demonstrate "willful violation".

In Masseroli v Gatfield, 84 Misc 3d 487, 220 N.Y.S.3d 591 (Westchester Supreme Court, 2024), it was held that even though the landlord's action in not providing itemized statement within 14 days violated the statute, the tenants were only entitled to the amount of the deposit, finding that said action or inaction was not willful because the landlord stated that she was not aware of the law. See also Case v. 575 Classon Avenue, LLC, 18 Misc 3d 144(A), 204 N.Y.S.3d 710 (App Term., 2nd, 11th and 13Th Jud. Dist. 2024) wherein that court found that the violation of the statute was not willful where landlord failed to provide the statement within the timeframe, without further. Likewise, here, plaintiff provided a reason, albeit mistaken, for withholding defendants' deposit and not providing an itemized statement.

This court also recently held in Bogom-Shanon v. Altman, 89 Misc 3d 647, 248 N.Y.S.3d 844 (Civil Court, City of New York 2025), that an attorney-landlord acted 'willfully' in giving tenant oral, and not written, notice indicating basis for the amount retained from the security deposit. It reasoned that unilateral mistake of law is not a defense for an attorney admitted in State of New York. Even then, the court only awarded one-half of the deposit amount as punitive damages, as opposed to twice the deposit amount, finding that the attorney did in fact contact the tenant within 14 days and explained his reasoning for withholding the deposit, albeit orally.

Accordingly, the court finds that these defendants are not entitled to punitive damages.

CONCLUSION

In sum, this court having already found that plaintiff unreasonably withheld his consent in assigning the lease, defendants are entitled to the return of their deposit, only. See WG Three Associates, LLC, supra. (holding that defendants are entitled to recover the amount they paid in rent after plaintiff unreasonably withheld its consent to the assignment).

The parties have another case in this court, entitled Lichtman and Levenson v. D & R Realty Associates Corp, bearing index number SC-000013-26/KI, wherein these defendants are suing plaintiff for the exact same claim interposed as counterclaim in this action, which case remains unresolved to this day. This court having resolved said counterclaim herein, the sister case of SC-000013-26/KI is now rendered moot.

Accordingly, it is

ORDERED that defendants have judgment in the principal amount of $3,350, plus interest from November 1, 2025; and it is further

ORDERED that defendant's application for punitive damages is DENIED; and it is further

ORDERED that the duplicative case of SC-000013-26/KI is hereby DISMISSED as fully resolved and therefore moot.

This is the decision and order of this court.

Date: 08/05/2026

Hon. Chidi A. Eze

Civil Court Judge (NYC)

FOOTNOTES

1.   Defendants argue that this amount is for their deposit of $3,350, plus twice that amount in punitive damages, for a total of $10,050, pursuant to General Obligation Law § 7-108. They limited their claim to $10,000 being the limit recoverable in this court.

Chidi A. Eze, J.