Landlord Must Prove Need for Consulting Fees

Landlord applied for MCI rent hikes based on the installation of a new oil burner/boiler and hot water heater, along with related expenses. The DRA disallowed any increase for what it called attorney's and contractor's fees. Landlord appealed, claiming that the fees in question were actually heating consultant fees. The consultants were hired to provide expertise in selecting a heating contractor and to supervise the installation. The DHCR sent the case back for further fact-finding. Generally, landlord should have sufficient knowledge to select a contractor and heating equipment without using consultants. And tenants shouldn't have to pay for a consultant to supervise and administer the installation when a general contractor is also being paid. But certain engineering and/or architectural expenses directly related to installation of the boiler/burner and hot water heater---such as inspections and drawing of plans and specifications---may qualify as expenses includible in the MCI increase.

Rockaway One Co.: DHCR Adm. Rev. Dckt. No. BE 430044-RO (7/2/93) [3-page document]