GIARDINI v. KESHTGAR (2018)

ORDERED that the order, insofar as appealed from, is affirmed, without costs.

In this action, plaintiffs, who subleased a property from a corporation of which defendant was the president, seek to recover from defendant a $9,600 security deposit which plaintiffs tendered to their corporate sublessor upon signing the commercial sublease in April 2010. As limited by the brief, plaintiffs appeal from so much of an order of the District Court as denied plaintiffs' motion for summary judgment and granted the branch of defendant's cross motion seeking to dismiss the complaint.

The rule is well established that if the time stipulated for the return of a security deposit has not yet arrived, a conveyance of the property or the assignment of the lease by the landlord will not, in and of itself, entitle the tenant to its immediate return. This rule is unaffected by whether the landlord retains the security deposit or turns it over to the grantee (see Mauro v. Alvino, 90 Misc. 328, 152 N.Y.S. 963 [App. Term, 1st Dept. 1915] ). The security deposit may be retained until the right to hold it as security has terminated (see Rosenfeld v. Aaron, 248 N.Y. 437, 162 N.E. 478 [1928]; see also 5 Robert F. Dolan, Rasch's Landlord and Tenant—Summary Proceedings § 13:17 [5th ed 2017] ). Here, the sublease agreement between plaintiffs and their corporate sublessor provided that the security deposit will be returned to plaintiffs "30 days after the Fixed Expiration date and after delivery by Tenant of the entire Demised Premises to Landlord in the condition required by this Sub-Lease." We note that the time stipulated in the sublease for the return of the security deposit has not yet arrived.

Plaintiffs argue that, pursuant to General Obligations Law § 7–105, defendant is liable for the return of the security deposit. This argument is unavailing. Section 7–105 provides generally that when a landlord transfers the ownership of a property, it must also transfer the tenant's security deposit to the new owner and notify the tenant, and courts have held that this provides a successor landlord with a private right of action against the prior landlord (see Gerel Corp. v. Prime Eastside Holdings, LLC, 12 A.D.3d 86, 783 N.Y.S.2d 355 [2004]; Perez v. Ruggiero, 35 Misc. 3d 126[A], 2012 N.Y. Slip Op. 50567[U], 950 N.Y.S.2d 725 [App. Term, 2d Dept. 2d 11th & 13th Jud. Dists. 2012] ). However, nothing in § 7–105 would appear to change the rule that a tenant has no cause of action against a former landlord for the return of a security deposit prior to the time stipulated for the security deposit's return. Consequently, plaintiffs' motion was properly denied and the branch of defendant's cross motion seeking to dismiss the complaint was properly granted.

Accordingly, the order, insofar as appealed from, is affirmed.

MARANO, P.J., GARGUILO and BRANDS, JJ., concur.