Hearing Required on Whether Landlord and Contractor Related

Tenant complained of a rent overcharge. Landlord claimed that it had made apartment improvements before tenant moved into the apartment. The DRA accepted landlord's documentation of the improvements and found no overcharge. Tenant appealed, claiming that the building's managing agent had a 1 percent interest in the entity that owned the building. Tenant said that the building owner and the entity that did the apartment improvements were the same, and that there was a conflict of interest. Tenant also argued that landlord's proof of the cost of the improvements was insufficient. The DHCR ruled for tenant and reopened the case. Under DHCR Policy Statement 90-10, if there is a joined interest between a contractor and a building owner, then additional proof of cost and payment related to an apartment improvement installation can be requested. Statements submitted by the building owner and the contractor, claiming that there was no joined interest between them, were contradicted by building permit documents and other records tenant submitted. The case was therefore sent back to the DRA for further investigation.

Lightbourne: DHCR Adm. Rev. Docket No. VH910013RK (9/12/07) [6-pg. doc.]