New Landlord Not Responsible for Pre-April 1, 1984, Overcharge

(Decision submitted by Jack Kuttner of the Manhattan law firm of Kucker Kraus & Bruh, LLP, attorneys for the landlord.) Tenant complained of a rent overcharge in 1980. The DRA ruled against tenant in 1987, and tenant appealed. The DHCR ruled for tenant in 1996 and found a total overcharge of $1,500. The DHCR ruled that current landlord was responsible for overcharges occurring after April 1, 1984, and all overcharges collected by prior owners before April 1, 1984. Landlord appealed. It bought the building from a receiver in March 1995; and, although it filed a Report of Change of Ownership with the DHCR, landlord never received notice of tenant's PAR until it was decided. Landlord also argued that it was contrary to current Rent Stabilization Code provisions to hold current landlord responsible for a pre-April 1, 1984, rent overcharge, that its purchase in a judicial sale barred responsibility for a rent overcharge, and that the DHCR should apply the pre-April 1, 1984, Rent Stabilization Code provisions to the 1980 complaint. Those provisions limited responsibility for a rent overcharge to landlord who collected the overcharge. The court ruled for landlord. The DHCR didn't notify new landlord of tenant's PAR. And the Rent Stabilization Law and Code provisions in effect on March 31, 1984, applied to the complaint filed in 1980. For both these reasons, new landlord wasn't responsible for the rent overcharge.

Marolda Properties, Inc. v. DHCR: Index No. 115441/96 (5/15/97) [7-page document]