Court Dismisses Tenant Claim of Improper Deregulation and Rent Overcharge

Tenant sued landlord in 2022, claiming that unjustified rent increases for her formerly rent-stabilized apartment since at least 1992 resulted in improper vacancy deregulation of the unit by landlord in 2003, resulting in rent overcharge. Landlord claimed that the unit was lawfully deregulated in 2003 when the last rent-stabilized tenant moved out and the rent exceeded the vacancy deregulation threshold then in effect. Landlord also argued that tenant's claims were barred by a four-year lookback period because tenant hadn't asserted any claim of fraud. And landlord maintained that under pre-HSTPA rent stabilization law, it wasn't required to keep records relating to individual apartment improvements (IAIs) more than four years prior to the last apartment registration. Landlord asked the court to dismiss the case in part without trial.

The court ruled for landlord. Tenant claimed that landlord took both a vacancy increase and a two-year renewal increase for the apartment in 1992 and 1993 when it was only permitted to take one or the other. But the court found that landlord properly took the rent increases it did at that time when permitted by law and Rent Guidelines Board orders to do so.

The court also ruled that, under pre-HSTPA law, landlord wasn't required to maintain or produce documents pertaining to IAIs outside the four-year period prior to its most recent registration. An appeals court already had ruled that there was no requirement that such records be maintained indefinitely. Landlord's last registration for the apartment was in 2003 when the apartment was registered as "permanently exempt" according to high-rent vacancy deregulation. Because all registered IAIs occurred outside the four-year period prior to 2003, landlord wasn't required to produce such documentation in pre-trial questioning. Based on this finding, there was no reason to grant injunctive relief sought by tenant. And tenant wasn't entitled to any overcharge finding for rents collected 16 years before tenant sued landlord. Because the first overcharge claimed by tenant occurred more than six years before the complaint was filed, her overcharge claims were untimely. Tenant also didn't claim fraud.

Nadler v. Carmine Ltd.: Index No. 155461/2022, 193 NYS3d 703, 2023 NY Slip Op 50850(U)(Sup. Ct. NY; 8/11/23; Lebovits, J)