DHCR Must Review Whether Apartment Was Properly Deregulated

Tenant complained to the DHCR in 2018 of rent overcharge and improper apartment deregulation. The DRA ruled against tenant, finding insufficient evidence of fraud and that the apartment had been vacancy deregulated prior to the four-year base date. Tenant appealed and the case was sent back to the DRA for further consideration.

There was an unexplained monthly rent increase from $675 to $2,000 between 2008 and 2009, resulting in the landlord registering the apartment as deregulated in 2010. Despite the DRA's request, landlord failed to submit proof of individual apartment improvements (IAIs) to explain this increase. Instead, landlord submitted a lease for the prior tenant that ran from Oct. 1, 2012, to Sept. 30, 2013, at a monthly rent of $2,500 per month. Since that tenant's rent was higher than the vacancy deregulation threshold, landlord had claimed this was further proof of proper deregulation. Landlord also re-registered the apartment as deregulated in 2012. But landlord didn't submit any proof to substantiate the $500 monthly rent increase it would've taken to deregulate the unit in 2012. Given landlord's two different deregulation registrations and the large and unexplained rent increases behind each deregulation, the DRA should further examine whether the apartment was properly deregulated.

McGee: DHCR Adm. Rev. Docket No. LP410002RT (7/20/23)[3-pg. document]