Guarantor Claims Overcharge by Tenant After Tenant Sues Guarantor for Subtenant's Unpaid Rent

Rent-stabilized tenant sublet her apartment for a term from Aug. 21, 2018, to Aug. 31, 2020. After the sublease ended, tenant sued the subtenant's lease guarantor for unpaid rent and based on the subtenant's failure to vacate. Tenant claimed that subtenant owed her $9,800 in back rent, plus damages owed to tenant's landlord for subtenant's, and therefore tenant's, failure to vacate, along with damage by subtenant to tenant's personal property and legal fees.

In response, the guarantor claimed a number of defenses, including failure to state a cause of action, that the guaranty was unenforceable due to vagueness, that tenant overcharged subtenant and therefore owed subtenant triple damages. Tenant asked the court to dismiss the guarantor's defenses.

The court ruled for tenant in part. The court dismissed the guarantor's first affirmative defense that the complaint failed to state a cause of action. The court refused to dismiss the second affirmative defense, finding nothing to support the guarantor's claim that the guaranty was impermissibly vague and unenforceable. A guaranty is a promise to fulfill the obligations of another party and is subject to the ordinary principles of contract construction. Here the guaranty simply states that the guarantor will be responsible for payment of rent each month as outlined in the agreement in the event the subtenant fails to pay rent. Tenant didn't show that the defense is without merit as a matter of law, so the court wouldn't dismiss that defense. The court also refused to dismiss the third and fourth affirmative defenses concerning rent overcharge as they had a basis in law. Since tenant had standing to bring the case, the fifth affirmative defense was dismissed. 

Gaudioso v. Basselini: Index No. 150884/2021, 2024 NY Slip Op 32447(U)(Sup. Ct. NY; 7/16/24; Tisch, J)