Sprinkler Law: Is It a Big Deal or Just Routine?
Nov. 20, 2014 — Dec. 3 is very close — and if you're a board member or manager, you may be concerned. Then again, you may not. The one thing that's indisputable is that Dec. 3 is a deadline of which you, your manager, and/or your attorney should be aware. Here's the deal: effective in less than two weeks, all residential leases (which include proprietary leases) in New York State signed after Dec. 3 must include a notice to the tenant about the presence or absence of sprinkler systems in the "leased premises."
No Exceptions
The new law, while defining what a sprinkler system is, does not define what a "lease" is or what "premises" are.
"The law is effective through the entire state of New York and makes no exceptions for premises that are governmentally regulated or even governmentally run," explains Adam Leitman Bailey, partner in his eponymous firm. "There is no question whether the document in question really is some kind of lease; it appears clear that the law covers both main leases and subleases, both new leases and renewal leases."
Bailey adds: "Since the statute specifies that the new language has to be in bold print (without specifying just what the language is), this means that it will not be good enough for the board of directors to pass a resolution that all of the leases in the complex are 'deemed' amended by adding this language. It will actually have to be done in real time on real paper. We have no way of predicting the results if a shareholder simply refuses to sign the new lease. We note that in some cooperative developments, this could mean the forced reissuance of hundreds of leases."
One key point: the law has no enforcement mechanism and no penalty for noncompliance.
Arthur Weinstein, an attorney in private practice, advises his clients to deal with this issue by having every resident sign a letter, prepared by the board, attorney, or managing agent, simply acknowledging that they do or do not have sprinklers, and also reporting on the last day of maintenance and inspection of the system.
"It's like the window guard notices," Weinstein says. "You send them out once a year. The managing agents are sending them out; lawyers are not getting involved because it's pretty routine. As near as I can tell, it's as much a management issue as anything else."
Although the deadline of Dec. 3 applies only to leases signed after that date, Weinstein believes buildings should treat the matter retroactively. "The intent of the law is to require lessors to provide relevant information about sprinkler systems to tenants under residential leases in the leased premises. In doing that, the law does not exclude cooperative proprietary leases. But proprietary leases are unique because they do not have the periodic renewals of those found in conventional apartment leases. With that in mind, many co-op/condo attorneys are saying, 'If the city feels it is so important, why should we seek out a technicality to avoid complying?' Therefore, many attorneys and managing agents are erring on the side of caution by providing annual updates about sprinkler systems in the same way that they provide annual updates about other safety issues. The buildings with residents who hold proprietary leases that I represent are now complying with the law."
Not a Lease, a License
Some leases for residential space go by the name "occupancy agreement," attorney Adam Leitman Bailey explains, but are nonetheless actually leases. In fact, there is no legal requirement for what the parties call the agreement. Even more confusing, some leases deny that they are leases. This is typical of leases that call themselves licenses. While some licenses really are licenses, licenses are difficult to draft correctly and, therefore, courts hold many documents that want or claim to be licenses to actually be leases. As a result, the parties holding this kind of lease could be very surprised to find out that this statute applies to them.
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