Fighting Eviction: Stay for Use and Occupancy by Neil Pedersen When a commercial or residential tenant is being evicted from their space by a landlord, CPLR 5519 [a] [6] provides for a stay for use and occupancy. The court issues a judgment of eviction which requires the tenant to vacate the property. Tenants can appeal the eviction and, pending the appeal, post a bond to stop it; this is called a stay for use and occupancy.

The Civil Court of the county that the proceeding is pending in is required to set the bond amount. The court will set a bond amount in response to an attorney’s motion to set the amount of bond. Attorneys make motions to set the bond amount in the Civil Court proceeding, sometimes for attorney’s fees, other times for the rent during the time it would take for the Appellate Court to make a determination on the appeal. The court may also set a bond for both the attorney’s fees and the amount of rent that would accrue during the time it would take to appeal. It is important to make sure that the order issued by the judge should provide for both an undertaking and a surety bond — civil court clerks will not accept the bond if the order only provides for an undertaking.

Part of the surety’s underwriting will look at why the rent is not being paid. Is it a legitimate dispute? Has the rent been escrowed with the attorney? Many of these bonds require collateral unless it’s for an individual with strong financial wherewithal — or a company that is a financially sound entity.

The surety would request either collateral (cash, a letter of credit, or publicly traded non-retirement account securities) or alternatively the company or individual can produce a financial statement and tax return for the surety to underwrite the obligation. If the company is a publicly traded company, their financials are readily available on the internet, so a financial statement would not be required.

If you need assistance or have questions, contact us today at 212-227-7277.

Neil Pedersen
15 Maiden Lane Suite #800
New York, NY 10038

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