Landlord Can't Charge First Rent for Restoring Apartments to Original Condition

Tenant complained of a rent overcharge. The DRA ruled for tenant, and landlord appealed, claiming that the apartment was newly created and that landlord could collect a free market rent, subject thereafter to rent guidelines increases. The DHCR ruled against landlord, but upon recalculation found no overcharge. Prior to 1984, apartments 5G and 5H were separate apartments. In 1984 landlord removed a wall to create new apartment 5GH. In 1989, before tenant moved in, landlord again divided the apartments into 5G and 5H. Tenant moved into 5H. The DHCR found that apartment 5H wasn't newly created in 1989. The base rent for apartment 5H was the last rent stated in a 1983 lease for that apartment. The current legal rent was to be calculated by deeming leases using applicable rent guidelines to bring the rent up-to-date.

London Mgmt. Corp./Sparling: DHCR Adm. Rev. Dckt. Nos. JF410251RO; JF410030RT (1/31/97) [4-page document]