DHCR Applied Default Formula to Calculate Overcharge

Rent-stabilized tenant complained of rent overcharge. The DRA ruled for tenant and, using the default formula to set the base-date rent, found a total overcharge of $13,065, including interest and triple damages. Tenant appealed and lost. Tenant argued that the DRA's calculations were incorrect and that the DRA should have examined pre-base date rent history. But the DHCR found that the DRA appropriately applied the default formula to determine the base date legal regulated rent. In accordance with RSC Section 2522.6, the base date rent for tenant's apartment couldn't be determined because the apartment was owner occupied on the base date. In the case of Regina Metropolitan Co. v. DHCR (2020), New York's highest court held that pre-base rental events cannot be examined in cases such as this one. So, the DRA correctly set the base date rent using the default formula method #4. This involved using the average rent of the same size regulated apartments in the same building to arrive at a base date legal rent of $1,587 per month. The DRA correctly added an 18.5 percent vacancy rent and a 7.8 percent longevity increase to this amount based on the last prior vacancy increase taken for the apartment. [Download a PDF of the decision here.]

Lucash: DHCR Adm. Rev. Docket No. LP110019RT (8/31/23)[4-pg. document]