DHCR Decision Didn't Interfere with Tenant's Court Case Against Landlord

Landlord applied in March 2015 for a ruling from the DHCR concerning the legal rent of tenant's apartment. Landlord moved into the apartment in October 2014 at a free market rent of $4,395. Landlord admitted that, under the 2009 Roberts decision, the apartment remained rent stabilized since the building was under a J-51 tax benefit when tenant moved in.  Landlord also registered the apartment for the years 2010 through 2014. In November 2015, tenant asked the DHCR to either delay a ruling or deny landlord's application because tenant, along with eight other tenants, had started a court case against landlord claiming willful rent overcharge and fraud.

The DRA ruled in April 2017 that the DHCR's policies on the issue of tenant's rent were set forth in the DHCR's J-51 Rent Registration Initiative - FAQ, which includes a procedure for calculating the legal rent to be registered for an apartment regulated due to J-51 benefits and the Roberts decision.

Tenant appealed and won, in part. Tenant claimed that the DRA's decision interfered with tenant's claims before the court. The DHCR ruled that the DRA's order didn't prejudice tenant's rights or claims in the court case in any way, but simply set forth the relevant J-51 Rent Registration Initiative policies and procedures. The DRA order didn't render a decision as to tenant's legal rent. The guidelines of the Initiative also weren't comprehensive with respect to rent regulation under J-51 benefits and didn't alter tenants' or landlords' rights under the law. However, the DRA should have made reference to tenant's pending court case, and the DHCR amended the order to reflect that the case was pending.

McFarland: DHCR Adm. Rev. Docket No. FQ410027RT (4/10/18) [4-pg. doc.]