DHCR Must Reconsider Triple Damages

Tenant complained of rent overcharge. The DRA ruled for tenant and ordered landlord to refund $23,100, including triple damages. Landlord appealed the portion of the DRA's order that assessed triple damages, claiming that there was no willful overcharge and that landlord had refunded the overcharge with interest within the time allowed to respond to the complaint.

The DHCR ruled against landlord because landlord issued the refund some time after the 30-day period provided for landlord's initial answer to the complaint, as required under DHCR's Policy Statement 89-2. Landlord then filed an Article 78 court appeal and argued that the DHCR's decision was arbitrary and unreasonable.

The court ruled for landlord and sent the case back to DHCR for reconsideration. The DHCR overlooked the fact that the DRA had granted 10 extensions for landlord to investigate and answer the complaint as landlord was attempting to obtain rent history records from the prior landlord. Landlord had issued tenant a full refund, including interest, within the time granted to answer. The amount of the overcharge before interest or triple damages was the same amount of overcharge found by the DHCR, which also indicated landlord's good faith.

Choice Associates LLC v. DHCR: Index No. 100515/2018, 2018 NY Slip Op 28416 (Sup. Ct. NY; 12/27/18; St. George, J)