Illegal Sixth Unit Added

Facts: Several tenants filed overcharge complaints, claiming that landlord didn't offer them rent-stabilized renewal leases. Landlord argued that the building isn't subject to rent stabilization because it only has five units. Tenants claimed there were six units, and a DHCR inspection confirmed this. The DRA found the apartments were rent-stabilized, and landlord appealed. Landlord argued that the building had an illegal sixth apartment when he bought it, and that he'd tried evicting tenant of that apartment in order to bring the building into compliance with the certificate of occupancy. The DHCR upheld the DRA's ruling, and found that even though the illegal sixth unit had been added after the base date, the building was rent-stabilized. The DHCR upheld the DRA's ruling, and found that the building was rent-stabilized, even though the illegal sixth unit had been added after the base date. Landlord appealed several times, and the appeals court sent the case back to the DHCR for reconsideration. The building isn't rent-stabilized, but the current tenants are. A six-unit building with only five legal units is considered nonregulated only if three conditions are met: (1) current landlord didn't make the illegal alteration; (2) the illegality can't be easily corrected; and (3) current landlord has tried to correct the illegality. Since landlord met all three conditions, the building will be treated as nonregulated for any future tenant. But current tenants don't lose their rent-stabilization protection.

Various Tenants of 25-05 Newtown Ave.: DHCR Adm. Rev. Dckt. Nos. IJ 110020-RP et al. (11/4/94) [7-page document]