Four-Year Lookback Applied to Overcharge Claim Pending When HSTPA Enacted

Rent-stabilized tenant sued landlord for rent overcharge. Tenant's apartment had been improperly deregulated while the building received J-51 tax benefits. Landlord claimed that the apartment's legal regulated rent was $2,538, and asked the court to dismiss the overcharge claim without triple damages because landlord had refunded any overcharge. The court ruled for landlord in 2018, and tenant appealed.

The appeals court ruled against tenant. In the Roberts case, New York's highest court established in 2009 that a rent-stabilized apartment couldn't be deregulated under luxury decontrol laws while the building received J-51 tax benefits. But there was no proof that landlord engaged in fraud in deregulating the apartment. Also, in Regina Metro. Co. v. DHCR, New York's highest court ruled in April 2020 that an overcharge claim pending on June 14, 2019, was subject to a four-year lookback period. So the applicable base date was April 2006, four years before the complaint was filed. The lack of DHCR registration filings in 2006 didn't matter. "Rental history," as that term is used in CPLR Section 213-a, wasn't restrained to DHCR records and could include the records of landlord and tenant.

So the base rent was $2,000, which was the rent actually paid by prior tenants in April 2006. Landlord was entitled to a 20 percent vacancy increase when tenant moved into the apartment, and 5.75 percent renewal increase two years later. And a finding of willfullness generally didn't apply to cases arising in the aftermath of the Roberts case. Failure to file timely annual DHCR rent registrations also didn't support triple damages.

Corcoran v. Narrows Bayview Co., LLC: Index No. 9206, 104549/10 2020 NY Slip Op 03061 (App. Div. 1 Dept.; 5/28/20; Acosta, PJ, Friedman, Manzanet-Daniels, Gesmer, Singh, JJ)