Landlord Didn't Sufficiently Prove IAIs

The DHCR's Tenant Protection Unit (TPU) commenced an individual apartment improvement (IAI) audit of an apartment rent based on a review of rent registrations. Based on landlord's failure to comply with the audit or to justify the rent increase for the apartment, the TPU determined that the 2013 legal regulated rent should be reduced from $1,759 and registered at $919, and that landlord's IAI rent increase should be disallowed. Because landlord took no action to comply with the TPU's determination, the TPU referred a rent overcharge complaint to the DRA.

The DRA ruled against landlord based on landlord's failure to submit rent history documentation and set the rent using the DHCR's default procedure. The DRA ordered landlord to refund to tenant almost $42,000, including triple damages and interest.

Landlord appealed, and the DHCR denied landlord's PAR. Landlord then filed an Article 78 court appeal, and the DHCR took the case back for reconsideration of the imposition of triple damages. The DHCR ruled for landlord. Although no itemization was submitted, landlord submitted documentation showing that substantial work was performed in the apartment. Even if the documentation was inadequate to justify collecting an IAI rent increase, landlord's collection of that rent increase wasn't willful. The total overcharge refund was reduced to $24,730. 

Savuti II, LLC: DHCR Adm. Rev. Docket No. FQ210001RP (10/2/18) [5-pg. doc.]