DHCR Can Reconsider Prior Approval of Demolition Application

Tenants appealed the DHCR's decision to grant landlord's demolition application. In response, the DHCR asked the court for permission to take the case back for reconsideration. The DHCR claimed that its ruling may have resulted from an irregularity in vital matters. Under Rent Stabilization Code Section 2527.8, the DHCR can issue a new order modifying or revoking any prior order on this basis. The court ruled for the DHCR. Landlord appealed and lost. The DHCR admitted that its review of several issues raised by tenants was inadequate, including whether landlord's plans constituted a demolition under the Rent Stabilization Law. The DHCR also didn't adequately look at whether Loft Law protections extended to tenants in the building or whether landlord was required to obtain a timely work permit or offer lease renewals prior to the DHCR's ruling. The DHCR's finding that landlord showed the financial ability to complete the proposed demolition project because it had a $5 million credit line was also an irregularity, because the DHCR had also found that landlord had greatly underestimated the required tenant relocation expenses.

Porter v. DHCR: NYLJ, 5/5/08, p. 27, col. 4 (App. Div. 1 Dept.; Mazzarelli, JP, Saxe, Gonzalez, Acosta, JJ)