Legal Rent Set at Amount of Preferential Rent Where Higher Rent Not Preserved in Records

Rent-stabilized tenant complained to the DHCR of rent overcharge. The DRA ruled for tenant and set the legal regulated rent at $1,556 per month. Landlord appealed and lost. Landlord claimed that the amount of $1,556 was placed incorrectly in the legal regulated rent column of the owner's 2015 rent registration form. Landlord claimed that the lease for the period between Sept. 1, 2014, to Aug. 31, 2015, was $4,062 and that $1,556 was a preferential rent. But the apartment's renewal leases between 2013 and 2018 didn't preserve a claimed higher legal regulated rent of $4,062. So, pursuant to RSC Section 2521.2, it was reasonable for the DRA to find that the rent stated in the renewal leases was the legal regulated rent and use that rent in order to calculate future rent increases. Landlord argued that that annual rent registrations preserved the higher legal regulated rent on or before the base rent date in the overcharge case. But the DHCR noted that annual registrations are unaudited statements from landlords and aren't as reliable as contemporaneous rent records to prove the legal regulated rent or establish the legality of a preferential rent. 

Kyle Enterprises of NY LLC: DHCR Adm. Rev. Docket No. HS210089R (12/27/23)[3-pg. document]