Landlord Proves Apartment Was Vacancy-Deregulated in 2012

Tenant complained in 2015 of rent overcharge and improper apartment deregulation. He also claimed rent fraud by landlord. Tenant paid an unregulated rent of $4,795 when he moved into the apartment in May 2012. The prior registered rent-stabilized rent was $1,301. Landlord produced documentation of an MCI rent increase and individual apartment improvements (IAIs) performed before tenant moved in. The DRA found that the May 2011 base date rent was $1,424.68, which included an MCI rent increase, that the prior tenant's vacancy lease commenced in 1971 so that landlord was entitled to a 24 percent longevity increase, and that landlord documented IAI costs of over $39,000. Together with the permissible vacancy increase, the lawful rent when tenant moved in was $2,654.85. Since the vacancy deregulation threshold at that time was $2,500 per month, the apartment was properly deregulated and there was no overcharge.

Tenant appealed and lost. Tenant disputed the longevity increase, the MCI rent increase, as well as  specific items in landlord's IAI documentation. But the DRA properly added the MCI increase to the legal regulated rent stated in the applicable renewal lease. And the number of years to which the longevity increase applied was proven by the prior tenant's vacancy lease from 1971 and wasn't limited to the DHCR registration system that commenced in 1984. The IAI evidence, including invoices and cancelled checks, also was sufficiently itemized. And despite tenant's claim, the fact that landlord didn't give tenant a deregulation notice or register the apartment as deregulated until 2015 wasn't proof of a fraudulent scheme to deregulate the apartment. The apartment rent was legally increased to result in vacancy deregulation.

Mentovai: DHCR Adm. Rev. Docket No. IS410005RK (4/27/21) [7-pg. doc.]