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Update: Judicial Ruling Brings Broker Fee Ban to Swift Halt

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by Bill Oxford, from Unsplash

A New York judge ruled against New York’s surprise broker fee ban on Monday, reversing last week’s shock announcement. The ruling came after the real estate industry filed a lawsuit against the Department of State, alleging the agency “usurped” the state legislature and engaged in inappropriate rule-making. Ruling in favor of the plaintiffs, the judge issued a temporary restraining order that will allow broker fees to continue being collected. The Department of State will have a chance to respond in court on March 13 in its effort to implement this new rule. Although the situation remains fluid, it appears that many observers of the rule change last week were correct to hone in on the question of whether regulators had overstepped the text of last year’s Tenant Protection Act in creating this rule or whether its language was sufficiently broad to permit this type of additional regulation. [1]

[1] Haag, M. (February 2020) Sorry, Renters: You Still Have to Pay Brokers’ Fees for Now from NY Times https://www.nytimes.com/2020/02/10/nyregion/nyc-broker-fees.html Accessed February 11 2020

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