No Furniture Allowance for Illusory Sublet

Subtenant complained of a rent overcharge by rent-stabilized tenant. Subtenant paid $1,525 per month, while the legal regulated rent was only $1,325. Subtenant also claimed that tenant owned none of the furniture in the apartment. The DRA ruled for subtenant but included a 10 percent furniture surcharge in the calculated legal rent. Both tenant and subtenant appealed. Tenant claimed that there was no overcharge. Subtenant contested the inclusion of the furniture surcharge in the legal rent. The DHCR ruled for subtenant. The Rent Stabilization Code allows tenants to charge subtenants a 10 percent furniture surcharge if an apartment is rented fully furnished. But tenant rented 15 apartments in the building and didn't live in any of them. So there was no legitimate sublet. This was an illusory sublet arrangement, and tenant wasn't entitled to the benefit of the surcharge.

Gaeta/Smiertely: DHCR Adm. Rev. Dckt. Nos. QB110062RO & QB110002RT (4/9/03) [6-pg. doc.]