Landlord Didn't Commit Fraud

Tenant complained of a rent overcharge. Landlord claimed that the building had fewer than six apartments and therefore wasn't rent stabilized. But a separate court ruling found that the building had more than six units and therefore was rent stabilized. The DRA ruled for tenant, who had moved into the basement apartment in 2005. The overcharge started in 2007 when landlord increased tenant's rent without giving him a lease. The DRA ordered landlord to pay tenant $9,000, including triple damages. Tenant appealed and lost. He pointed out that he had to go to court to prove rent-stabilization status, that he never had a lease, and that the apartment was never registered. Tenant claimed that landlord committed fraud by hiding the building's rent-stabilization status and that the DHCR should apply the default formula in calculating his legal rent. In this case, the DHCR found no fraud. Landlord believed that the building was unregulated because it contained fewer than six units. Her belief may have been unreasonable, thus warranting triple damages, but there were some facts to support it. The DHCR didn't find any fraud on landlord's part and upheld the four-year look-back period for calculating tenant's overcharge.

Kulitsa: DHCR Adm. Rev. Docket No. ZC410037RT (6/14/13) [4-pg. doc.]