Landlord Didn't Preserve Legal and Preferential Rents in Leases

Tenant complained of rent overcharge and claimed that her apartment was illegally deregulated. The DRA ruled for tenant, found that she was rent stabilized, reduced her rent from $2,410 to $1,965, and ordered landlord to refund $3,285, offset against $14,600 in rent arrears. The DRA found that tenant's lease didn't properly preserve a preferential rent. Landlord appealed and lost. While the base date rent was Nov. 27, 2011, the apartment was improperly vacancy deregulated while the building received J-51 tax benefits between 1992 and June 2008. So the DRA properly considered pre-base date rental events to establish the rent. And Rent Stabilization Code Section 2521.2, amended in 2014 and in effect when the DRA decided tenant's complaint, provides that the legal regulated rent must be stated in each lease from the inception of the preferential rent to be legally established and preserved. It didn't matter that landlord didn't anticipate the Court of Appeals 2009 decision in Roberts v. Tishman Speyer Properties while it charged a deregulated rent without preserving a legal and preferential rent in leases. 

First Lenox Terrace Associates LLC: DHCR Adm. Rev. Docket No. FU410051RO (5/22/18) [7-pg. doc.]