DHCR Permits Deemed Lease Renewal in Light of Implied Agreement

Rent-stabilized tenant complained of rent overcharge. The DRA ruled for tenant and ordered landlord to refund $5,684, including interest and triple damages. Landlord appealed and won, in part. Landlord argued that the DRA failed to consider deemed leases in calculating the legal rent. Under amended Rent Stabilization Code Section 2523.5(c)(2), theDHCR no longer broadly approved deemed lease renewals in light of the conflict with Real Property Law Section 232-c. But, if there is an express or implied agreement between landlord and tenant, there can be a deemed lease under the law. Here, an implied agreement did exist in connection with tenant's first renewal lease in 2009. Tenant remained in occupancy and consistently paid the rent increase charged despite the lack of a signed renewal lease. But there was no similar implied agreement for later renewal periods. Tenant continued to pay the rent charged under the initial deemed renewal, and was a month-to-month tenant. The total overcharge, with triple damages, was reduced to $417.

3103 Realty LLC: DHCR Adm. Rev. Docket No. CO210006RO (11/25/14) [6-pg. doc.]