Landlord Submitted Insufficient Proof of Claimed IAIs

TPU conducted an audit of individual apartment improvements (IAIs) made to a rent-stabilized apartment and found an overcharge. The TPU directed landlord to reset the registered $2,850 rent at $1,715, refund the current tenant excess rent paid, submit an amended annual building and apartment registration, and provide an amended lease with the reset legal regulated rent to the tenant. 

When landlord failed to comply with TPU requirements, the TPU initiated a rent overcharge complaint in 2018. In response, landlord claimed that there was no overcharge and that the apartment had been vacancy deregulated since September 2017. The DRA ruled against landlord, finding a total overcharge of $32,109 after deducting $13,736 in rent arrears owed by tenant, and that the LLR as of June 1, 2017, was $1,779.

Landlord appealed and lost. The DRA correctly applied DHCR Policy Statement 90-10, in effect at the time, to the IAIs. The contractor's invoice, which wasn't signed and wasn't marked "paid in full" didn't, by itself, satisfy the Policy Statement requirements. Landlord also didn't provide proof of the claimed $45,000 payment to its contractor in the form of cancelled checks or a contractor's affidavit. And the DHCR wouldn't consider a contractor's affidavit submitted for the first time on appeal since landlord provided no reasonable excuse for not submitting this information either to the TPU or the DRA.  

KC3 325 East 83rd St, LLC: DHCR Adm. Rev. Docket No. LV410020RO (2/20/24)[5-pg. document]