New Landlord Needn't Pay Triple Damages

(Decision submitted by James R. Marino of the Manhattan law firm of Kucker & Bruh, LLP, attorneys for the landlord.) Tenant complained of a rent overcharge. The DRA ruled for tenant and found that the overcharge was willful. New landlord appealed, claiming that it shouldn't be liable for triple damages. New landlord, who owned the building, leased the whole building to prior landlord under a net lease. New landlord didn't collect rents during that time and got the building back from the net lessee after suing to evict the net lessee based on its default. The DHCR ruled for landlord. The situation was similar to a judicial sale. In such cases, where there is no collusion between prior landlord and new landlord, new landlord will not be held responsible for triple damages. Since new landlord had to sue to recover the building from defaulting prior landlord, this was like becoming landlord through a judicial sale.

Kerner: DHCR Adm. Rev. Dckt. No. OH410001RP (11/1/00) [3-pg. doc.]