A tenant may assert as a defense to the nonpayment of rent the doctrine of constructive eviction, even if he or she has abandoned only a portion of the demised premises due to the landlord's acts in making that portion of the premises unusable by the tenant.
The tenants occupied a loft pursuant to a commercial lease. Petitioner landlord filed suit against respondent tenants for the nonpayment of rent. The tenants filed counterclaims comprised claims of a breach of the warranty of habitability and constructive eviction related to certain dangerous construction work and other conduct interfering with the tenants' ability to use and enjoy possession of their loft. The trial court entered judgment for the tenants, after a jury awarded the tenants compensatory and punitive damages on counterclaims. Also, the trial court awarded the respondents attorney's fees under N.Y. Property Law § 234. The appellate term court reversed the decision, striking the punitive damages and ordering a new trial. The appellate term court had found that the doctrine of constructive eviction did not provide a defense for the nonpayment of rent because the tenants had not abandoned the premises. The tenants sought review.
Was the doctrine of constructive eviction applicable as a defense for tenants' nonpayment of rent following their abandonment of a portion of the premises?
Reversing on appeal, the Supreme Court of New York, Appellate Division, held that (1) the tenants were allowed to assert the doctrine of constructive eviction as a defense to the nonpayment of rent when they abandoned a portion of the demised premises due the landlord's improper acts; (2) the record supported an award of punitive damages for the landlord's breach of the warranty of habitability; (3) the jury's award of an abatement of rent was improper as to the months in which the tenants had paid rent when the constructive eviction claim was asserted as a defense to the nonpayment of rent and the tenants did not request an abatement for any months other than those in which they did not pay rent; and (4) the award of attorney's fees under § 234 was proper. The reinstatement of the trial court's judgment was ordered, except that the award of rent abatement for the months in which the tenants had paid rent was eliminated.