Apartment Vacant on Base Date

Tenant complained of a rent overcharge. He claimed he'd moved into the apartment under an interim lease in 1990. A planned cooperative conversion of the building never took place. Landlord claimed that when the building was bought in 1985, it was uninhabitable. Landlord also claimed to have renovated tenant's apartment at a cost of $43,000. The DRA ruled against tenant, finding that the apartment was vacancy decontrolled prior to Dec. 31, 1973. So tenant's first rent wasn't subject to a fair market rent appeal. And since the apartment had been continuously vacant after rent control, landlord could charge the first rent of $1,000 to tenant. Tenant appealed, claiming that the apartment had been occupied during most of the time that landlord claimed it was vacant. The DHCR held a hearing and found that the apartment was occupied for some time during the early 1980s. The DHCR ruled for tenant in part. Under the Rent Regulation Reform Act of 1997, tenant's overcharge claim was now limited to a base date four years prior to the date he filed his complaint, which was March 26, 1988. The apartment was vacant on that date, so the DHCR set the initial rent in the way it would if landlord had bought the building at a judicial sale. This involved application of the DHCR's three-pronged test, taking the lowest figure of 1) the lowest stabilized rent for a same-sized apartment in the building, 2) tenant's first rent minus the vacancy and renewal guidelines in effect at that time, or 3) the prior tenant's last rent, if known. Tenant's first rent was reduced to $626. No rent increase was allowed for apartment renovation costs, since landlord's claimed costs were for major capital improvements rather than 1/40th improvements. The total overcharge was $6,000.

Meekins: DHCR Adm. Rev. Dckt. No. IK410010RT (10/22/97) [4-page document]