High-Rent Apartment Deregulated Prospectively

Landlord applied to the DHCR for high-rent/high-income deregulation of tenant's apartment. The DHCR ruled for landlord and deregulated tenant's apartment retroactive to the expiration of the lease in effect on March 30, 2004. Verification of tenant's income for the periods in question showed that it was over the $175,000 threshold. Tenant appealed, claiming that she was filing an amended tax return for one of the years in question and challenging the effective date of the deregulation. The court ruled for tenant in part. Tenant sought to amend her tax return too late for consideration. So the apartment was properly deregulated. However, the effective date of deregulation is after Jan. 20, 2005, the date of the DHCR's PAR decision. Since no lease was in effect as of that date because the landlord hadn't offered tenant a renewal, the lease was deemed to have been renewed upon the same terms and conditions as those previously in effect. All prior renewal leases since the start of the deregulation case contained lease riders regarding high-income deregulation. So the effective date of deregulation is 60 days after the PAR decision, or March 21, 2005.

Classic Realty LLC v. DHCR: NYLJ, 1/17/06, p. 29, col. 1 (App. Div. 1 Dept.; Mazzarelli, JP, Andrias, Marlow, Gonzalez, Sweeny, JJ)