Amended Code Provision Must Be Applied to Set Tenant's Rent

Tenant complained of rent overcharge. The DRA ruled for tenant and ordered landlord to refund $13,890, including interest. Landlord appealed and lost. Landlord argued that the DRA improperly applied an amended 2014 Rent Stabilization Code (RSC) provision instead of the rule in effect when tenant moved into the apartment. Before tenant moved in, the apartment had been temporarily exempt from rent stabilization and was “TE” on the base rent date. But amended RSC Section 2526.1(a)(3)(iii) states that if an apartment is vacant or temporarily exempt on the base date, the legal regulated rent is the prior legal regulated rent, the applicable vacancy increase, and--if vacant or temporarily exempt for more than one year--the rent can be further increased by successive two-year guideline increases that could otherwise have been offered during the vacancy or exemption period. RSC Section 2527.7 further provides that, unless “undue hardship or prejudice” results, any amendment to the RSC that's issued while a case is pending must be applied.

Capani: DHCR Adm. Rev. Docket No. EO210041RO (10/5/16) [3-pg. doc.]