Landlord Substantially Altered Apartment Without Increasing Its Size

(Decision submitted by William Eberight of the Manhattan law firm of Finkelstein, Borah, Schwartz, Altschuler & Goldstein, P.C.) Facts: Tenant complained of a rent overcharge. Landlord claimed that the apartment was so substantially altered before tenant moved in that landlord was entitled to set a first stabilized rent for the apartment. Landlord had spent $20,000 changing practically everything inside the apartment and adding interior usable square footage. The kitchen was totally reconstructed; a new entranceway door, new electrical and plumbing lines, a new bathroom, new windows, and new interior walls were added. The exterior walls weren't changed. The DHCR ruled that while there was a substantial upgrade of the bathroom and kitchen, landlord didn't change the outer dimensions of the apartment; so, landlord couldn't collect a first rent. Landlord appealed. Court: Landlord wins. The court rejected the DHCR's policy that the outer dimensions of an apartment must be changed in order for landlord to qualify for a first rent of a substantially altered apartment. Landlord's alterations were of sufficient quan-tity and quality to warrant a first rent. The DHCR's overcharge finding was revoked.

300 West 49th Street Associates v. NYS DHCR: Index No. 20017/92 (3/22/93) (Sup. Ct. NY; Greenfield, J) [4-page document]