This page explains New York law on whether a landlord can make a tenant pay the landlord's legal fees in a non-payment case, a holdover or a lease lawsuit, for both residential and commercial premises. KOR Law LLP's landlord representation practice represents commercial and residential landlords in non-payment, holdover and lease enforcement matters, and fee recovery is part of deciding whether and how to bring a case.
Where does a right to fees come from?
Court costs and legal fees are different things. In a summary proceeding, the judgment "shall award to the successful party the costs of the special proceeding" (RPAPL 747(1)), which are modest statutory costs, not lawyers' fees. A landlord's right to recover attorney's fees from a tenant almost always comes from the lease. Typical clauses let the landlord recover fees as "additional rent," or recover "reasonable legal fees" incurred because of the tenant's default.
Even with a clause, fees go only to the party that prevails. The First Department explained in 49 E. Owners Corp. v 825 Broadway Realty (2024) that "only a prevailing party is entitled to attorneys' fees, including in the context of lease disputes," and that the party must succeed on the "central relief sought," quoting the Court of Appeals. The court looks first at "the true scope of the dispute litigated" and then at "what was achieved within that scope." When results are mixed and not substantially favorable to either side, neither party prevails.
How does the residential rule change things?
Real Property Law 234 rewrites residential fee clauses. Whenever a residential lease lets the landlord recover attorney's fees or expenses caused by the tenant's failure to perform the lease, or makes those amounts additional rent, the law implies a matching covenant: the landlord must pay the tenant's reasonable fees caused by the landlord's own failure to perform, or incurred in "the successful defense of any action or summary proceeding commenced by the landlord against the tenant arising out of the lease" (Real Property Law 234(1)).
Three more rules follow. "A landlord may not recover attorneys' fees upon a default judgment." "Any waiver of this section shall be void as against public policy." And for co-op shareholder tenants, outside certain publicly assisted co-ops, fees may be awarded to either side on a default if the proprietary lease provides for them (Real Property Law 234(1), (2)).
Courts read the trigger broadly. In Graham Ct. Owners Corp. v Taylor (2015), the Court of Appeals held that section 234 applied to a lease that let the landlord, after cancelling the lease and retaking the apartment, apply re-rental income first to its expenses, including "reasonable legal fees." Because that clause let the landlord recover fees resulting from the tenant's breach, the tenant who successfully defended a holdover was entitled to fees.
| Question | Residential lease | Commercial lease |
|---|---|---|
| Source of the landlord's right | The lease's fee clause | The lease's fee clause |
| Does the tenant get a matching right? | Yes, implied by statute (Real Property Law 234(1)) | Only if the lease says so |
| Fees on a default judgment? | No (Real Property Law 234(1)), with a co-op exception (234(2)) | As the lease provides |
| Can the rule be waived? | No; waiver is void (Real Property Law 234(1)) | Contract terms control |
| Who must prevail? | The party that wins the central relief (49 E. Owners Corp.) | The same test |
| Late fees | Not before rent is five days late; capped at the lesser of $50 or 5% of monthly rent (Real Property Law 238-a(2)) | As the lease provides |
How does a landlord claim fees, step by step?
- Read the clause. Find whether fees are "additional rent," whether they cover summary proceedings and plenary actions, and whether they reach enforcement after judgment.
- Plead them. Ask for fees in the petition or complaint. The petition states the relief sought (RPAPL 741(5)). In Aryeh Realty (2026), the First Department noted that the landlord first raised one claim in closing argument after trial, having left it out of its petition, notice to cure and rent demand.
- Win the central issue. The court compares what each side achieved within the true scope of the dispute (49 E. Owners Corp.; Aryeh Realty).
- Prove the amount. Fees must be shown to be reasonable; in 49 E. Owners Corp. the landlord had not established reasonableness, and the award was premature.
- Keep the win. If the result is reversed, the fee award falls with it. In Medical Bldg. Assoc. v Abner Props. (2020), the First Department vacated a money judgment for an owner and "the grant of attorney's fees to owner" along with it.
How should fee exposure shape a residential case before it is filed?
Because Real Property Law 234 makes residential fee clauses run both ways, a case the landlord loses can cost the landlord the tenant's fees as well as its own. Most residential cases that fail do so on preliminary steps: a non-renewal notice served too late, a missing Good Cause Eviction notice, or a cure notice that never gave the tenant a real chance to fix the problem. Those requirements are covered in what notice a New York landlord must give before starting a holdover case. Getting them right is the cheapest way to manage fee risk.
Timing matters at the end of a case too. A landlord that wins possession still has to recover the premises through the officer's notice and the warrant, and a landlord that refuses a tenant's full payment of rent before execution in a non-payment case risks losing the warrant (RPAPL 749(3)). The final stage is explained in what happens after a New York landlord wins: the warrant and the eviction notice.
What changes the answer?
- Residential or commercial premises. Real Property Law 234 applies to leases of residential property.
- The clause's wording. A clause covering costs of retaking possession can trigger section 234 (Graham Ct. Owners Corp.).
- Counterclaims. A tenant's counterclaims count in the "true scope" of the dispute and can delay or defeat a fee award (49 E. Owners Corp.).
- A default. Residential landlords cannot recover fees on a default judgment (Real Property Law 234(1)).
- The central issue. A landlord that loses the main dispute, such as whether the rent was modified, does not prevail (Aryeh Realty).
- How the claim was pleaded. Claims raised for the first time late in the case may not be considered (Aryeh Realty).
For example: a residential holdover that the landlord loses
For example, imagine a landlord of a small Bronx building whose standard lease says the tenant must reimburse the landlord's reasonable legal fees as additional rent if the tenant breaches. (This is a made-up illustration, not a real client or result.) The landlord brings a holdover claiming the tenant installed a washing machine without permission. At trial, the court finds the superintendent approved the installation and dismisses the case.
Because the lease lets the landlord recover fees for the tenant's breach, Real Property Law 234 implies a matching right for the tenant, who successfully defended a summary proceeding arising out of the lease. The tenant may seek reasonable fees, by counterclaim or separate action (Real Property Law 234(1)). Had the tenant defaulted instead and the landlord won, the landlord still could not have recovered its fees on that default judgment.
Common mistakes
- Assuming fees follow every win. A summary judgment awards the costs of the proceeding (RPAPL 747(1)); a fee award needs a lease clause or other legal basis.
- Forgetting reciprocity. A residential landlord fee clause creates an equal tenant right (Real Property Law 234(1)).
- Seeking fees on a residential default. The statute bars it (Real Property Law 234(1)).
- Overreaching in the petition. Mixed results can mean no one prevails (49 E. Owners Corp.).
- Skipping proof of reasonableness. Bills and time records are needed (49 E. Owners Corp.).
- Charging improper fees. Residential late fees are capped, and most move-in fees are barred (Real Property Law 238-a).
What to do this week
- Find the fee clause in each lease form you use, and note whether it is residential or commercial.
- Check whether the clause covers summary proceedings, plenary actions and enforcement.
- Keep detailed time and billing records for any case where fees may be claimed.
- Narrow each case to the claim you can win cleanly.
- Review residential late-fee and application-fee practices against Real Property Law 238-a.
- Speak with counsel about fee exposure before starting a residential case.
Frequently asked questions
Can fees be added as "additional rent" in a non-payment case?
Many leases call fees additional rent, and Real Property Law 234 expressly covers clauses that make the landlord's fees payable "as additional rent." How a non-payment case works is explained in how a commercial non-payment case works in New York City.
Can a landlord deduct legal fees from the security deposit?
For residential units, deductions are limited to listed categories such as unpaid rent and damage beyond normal wear and tear (General Obligations Law 7-108(1-a)(b)). See a New York landlord's security deposit obligations.
Can a guarantor be charged the landlord's fees?
That depends on the guaranty's own terms. Guaranty defenses are discussed in what defenses a personal guarantor has when a New York lender sues.
Does a Yellowstone fight affect fees?
Fee rights in a Yellowstone case come from the lease, and the prevailing party test applies. See what a Yellowstone injunction means for the landlord.
Are fees recoverable for collecting the judgment?
Only if the lease or a statute provides for them. The collection tools themselves are described in what happens after a money judgment is entered in New York.
What if the case settles?
The settlement terms control. Because only a prevailing party recovers fees under a lease clause, the parties usually address fees in the stipulation itself.