Landlord Didn't Submit Proof of Rents Charged

Tenant complained of a rent overcharge. The DHCR asked landlord for proof of rents charged from the base rent date through the date that the complaining tenant moved into the apartment. Landlord didn't submit any proof of the rents charged. The DHCR ruled for tenant based on landlord's default and reduced tenant's rent in accordance with a three-part formula designed by the DHCR for this purpose. Landlord appealed, claiming that the DHCR's decision was arbitrary and unreasonable. The court and appeals court ruled against landlord. Landlord received notice from the DHCR that proof of rents charged was required in response to tenant's complaint. So the DHCR's decision was reasonable. The DHCR's method for setting rents under these circumstances also had been upheld previously by appeals courts.

Derfner Mgmt. Co. v. DHCR: NYLJ, p. 24, col. 6 (7/23/98) (App. Div. 2 Dept.; Bracken, JP, Pizzuto, Altman, Luciano, JJ)