Landlord Continued Collecting Overcharge After Making Partial Refund

Tenant in a rent-stabilized building subject to J-51 tax benefits complained to the DHCR in October 2012 of rent overcharge. Landlord claimed that it acknowledged the overcharge in accordance with the 2009 Roberts decision and refunded $14,475 to tenant in November 2016. But the DRA found that overcharges continued through October 2017 and that there was a total overcharge of $42,883, including interest and triple damages. The DRA therefore directed landlord to refund an additional $28,408 to tenant.

Landlord appealed and lost. Landlord argued that because it had adjusted the rent in response to tenant's overcharge complaint, DHCR Policy Statement 89-2 deemed that the overcharge was not willful. But, while landlord issued a refund to tenant in 2016, it continued overcharging tenant for another 11 months and therefore didn't qualify for any safe harbor to avoid triple damages. Also, the rent increase from November 2014 to October 2015 was properly disallowed because the DRA found that the purported renewal lease at that time was split into two six-month intervals and wasn't based on a one- or two-year renewal lease term as required by the RSC. However, new claims raised by tenant in opposition to landlord's PAR wouldn't be considered since tenant himself didn't file an administrative appeal.

Parker Queens L.P.: DHCR Adm. Rev. Docket No. GP110022RO (3/23/21) [3-pg. doc.]