Landlord Didn't Reduce Legal Rent While Complaint Was Pending

Rent-stabilized tenant complained of rent overcharge in 2016. The DRA ruled for tenant in October 2019, applying a six-year lookback period based on HSTPA changes to rent overcharge law. The DRA ordered landlord to refund $18,689, including triple damages.

Landlord appealed and won, in part. Landlord claimed that there was no willful overcharge since it made a refund in response to tenant's complaint. The DHCR noted at the outset that, although HSTPA called for a six-year overcharge lookback, New York's highest court ruled in its April 2020 Regina Metro. v. DHCR decision that this provision couldn't be applied retroactively and that portion of the DRA's decision was in error. A four-year lookback applied in this case, although it didn't change the result in this case as the overcharge began less than four years before tenant filed her complaint. Pre-HSTPA regulations and Amended Policy Statement 89-2 prevented triple damages if landlord had made a good faith full overcharge refund with interest.

But, in this case, although landlord gave tenant a $14,000 refund while the case was pending, it never adjusted tenant's rent to the proper legal amount, so overcharging continued over a period of more than five years. A refund alone, without the voluntary adjustment of rent, didn't rebut the presumption of willful overcharge. Still, prior to HSTPA, triple damages applied only on overcharges occurring less than two years before filing a rent overcharge complaint. So landlord owed tenant $15,000.

North-Driggs Holdings, LLC: DHCR Adm. Rev. Docket No. HX210022RO (8/19/20) [3-pg. doc.]