MBR Increase Capped by Phase-In of Prior Rent Hike

Rent-controlled tenant complained of a rent overcharge after receiving notice of an MBR increase for the 2004-05 cycle. The DHCR had previously granted landlord's application for a rent increase based on unique and peculiar circumstances. In that proceeding, the DHCR ruled that landlord could increase tenant's rent from $438 to $727. But the rent increase had to be phased in. Landlord could charge $510 as of March 1, 2004, $582 as of March 1, 2005, $654 as of March 1, 2006, and $726 as of March 1, 2007. Tenant argued that granting landlord an additional rent increase under the MBR Notice would violate the phase-in limitation of the prior DHCR order. The DRA ruled for tenant. Landlord appealed, claiming that the DRA improperly denied the legal MBR increase in addition to the rent increases based on unique and peculiar circumstances. The DHCR ruled against landlord. The DRA's interpretation of the prior agency order as capping the maximum collectible rent from tenant was reasonable. The prior rent increases for unique and peculiar circumstances were substantial, and the phase-in lessened the hardship of the rent increases on tenant.

207 Realty Associates LLC/Harding: DHCR Adm. Rev. Docket Nos. VD420001RO, VD420003RT (2/12/08) [10-pg. doc.]