No Overcharge or Rent Fraud Where Landlord Reregistered Apartment

Rent-stabilized tenant complained of rent overcharge on June 11, 2019. The DRA found no overcharge and dismissed the complaint. Tenant appealed and lost. Tenant argued that landlord had engaged in a fraudulent scheme to deregulate the apartment, and that the DHCR therefore should look back further than the four-year base date that applied to the case. But landlord had deregulated the apartment despite receiving J-51 benefits in 2004, during the period that the DHCR supported such action and before New York's highest court ruled in 2009 that this was incorrect. Tenant moved into the apartment before this ruling in 2009, and landlord had reregistered the apartment as rent stabilized in 2014. Absent an indication of rent fraud, the DRA properly limited review of the apartment's rent history to four years. The DRA properly set the base date rent at $2,835. A rent freeze otherwise required under RSL Section 26-517(e) didn't apply in "Roberts"-type cases like this one since any rent registration irregularities stemmed from a misunderstanding of the law. A jump in the apartment rent between 2004 and 2009 wasn't sufficient to establish a "colorable claim of fraud." There also was no overcharge under RSC Section 2528.4 based on missing registrations because landlord's filing of late registrations eliminated any overcharges based on the previous failure to register.  

Feldscher: DHCR Adm. Rev. Docket No. KM410012RT (6/8/22)[3-pg. document]