Cost of Apartment Improvements Disallowed

Tenant complained of a rent overcharge. She moved into the apartment in August 2006 and paid $1,100 per month. Landlord claimed that it made extensive improvements to the apartment costing $21,500 before tenant moved in. Landlord submitted a contractor's invoice for this amount for work including installation of new Sheetrock, five new wood doors, electric wires, light fixtures, switches and outlets, new plywood floor and commercial tiles, new kitchen cabinets, faucet and countertop, new bathroom tiles, bathtub, toilet, medicine chest and vanity, a fireproof metal front door, new stove and refrigerator, and new wood moldings. Landlord also submitted copies of checks for the work as well as a lease rider signed by tenant acknowledging many of the improvements. Tenant disputed landlord's claim. She said that landlord's documentation was false, that there was no contractor and that all repairs were done by the building super, and that few of the claimed improvements were made even though she signed the lease rider. DHCR inspection found that three walls of one bedroom were new, six doors appeared to be new, there were six new light fixtures in the apartment, six new switches, seven new outlets and four old outlets, parts of the apartment were covered in commercial tile, the living room floor was slanted and the hallway floor tiles were cracking, kitchen and bathroom floors weren't new, kitchen cabinets were old, and the refrigerator wasn't new. In response, landlord submitted a sworn statement from its contractor and requested a hearing.
The DRA ruled for tenant and reduced her rent to $663 per month. The DRA ordered landlord to refund $15,000. Based on inspection and landlord's misrepresentations, the DRA denied any rent increase for 1/40th improvements. Landlord appealed, claiming that DHCR's inspection report confirmed that much of the work was done. The DHCR ruled against landlord. The inspector's report found that a number of items either weren't done or couldn't be verified. Tenant also had submitted many photographs that contradicted landlord's claims. Since a vast majority of the claimed improvements weren't done and landlord misrepresented the nature and scope of the work, the DRA correctly disallowed any increase for apartment improvements.

1600 Bed LLC: DHCR Adm. Rev. Docket No. VK210095RO (6/19/08) [5-pg. doc.]