Landlord Who Charged Less Than Legal Rent Waived Higher Rent

Rent-stabilized tenant complained of rent overcharge. The DRA ruled for tenant in 2018 and found a total overcharge of $3,450, including triple damages. Since tenant owed $15,000 in rent arrears, no refund to tenant was required. Tenant and landlord both appealed and lost. Tenant argued that no rent increase for individual apartment improvements (IAIs) was warranted. But landlord proved that it spent $21,715 on IAIs and was granted a 1/40th IAI rent increase under Rent Stabilization Code Section 2522.4(a)(4) and DHCR Policy Statement 90-10, both in effect in 2014 when tenant filed her complaint. Landlord's invoices showed that kitchen cabinets and granite countertops, central air conditioner unit, stove, refrigerator, and range hood all were installed before tenant moved in. There was no proof, as tenant claimed, that landlord charged her for other building-wide renovations. Landlord argued that the DRA incorrectly found that the base date rent was $983. Landlord claimed that it was $1,500. But landlord produced no base date lease and the base date rent was set based on landlord's rent ledgers. Landlord registered the higher $1,500 rent as the legal rent. But, since landlord charged tenant $983, it waived any higher legal rent charged upon lease renewal. Landlord also objected to the triple damages. But landlord charged tenant a higher unpreserved legal regulated rent, resulting in an overcharge, and improperly registered the waived legal regulated rent. 

Harris/1188 Sterling Place Realty, LLC: DHCR Adm. Rev. Docket Nos. IS210073RK, IS210074RK (1/7/21) [14-pg. doc.]