Landlord Charged Preferential Monthly Rent of Below $2,000

Facts: In 1991, landlord charged prior rent-stabilized tenant $1,600 per month in rent, but registered this as a preferential rent and registered $5,041 as the legal registered rent. Landlord later charged current tenant $1,820 per month under a lease starting in August 1993 and again registered this as the preferential rent. Landlord registered the legal registered rent as $5,780. When tenant's lease expired in 1995, landlord refused to renew, claiming that tenant was now deregulated. In 1993, the rent stabilization law had been amended to provide that if the legal rent-stabilized rent was $2,000 or more upon vacancy, the next tenant was destabilized. Tenant complained of a rent overcharge and of failure to renew the lease. The DHCR ruled for tenant, and landlord appealed. Court: Landlord loses. The DHCR ruled that to qualify for deregulation, the $2,000 rent must be the actual rent charged, not a preferential rent. Otherwise, there was too much chance of abuse by landlords. The DHCR's decision was found by the court to be reasonable and was upheld.

Haberman v. Lynch: Index No. 111382/99 (3/22/00) (Sup. Ct. NY; Wilk, J) [7-pg. doc.]