No Reduced Vacancy Increase Before June 2015 Where Prior Tenant Paid Preferential Rent

Rent-stabilized tenant complained of rent overcharge. The DRA ruled against tenant, finding no rent overcharge. Tenant appealed and lost. Tenant moved into the apartment on June 1, 2012, at a legal regulated rent of $2,520.60 and paid a preferential rent of $1,800. Tenant later signed three renewal leases, listing both legal regulated rents and preferential rents. The base date for tenant's complaint was June 22, 2012, after tenant moved in. Landlord submitted the pre-base date lease of prior tenant that the DRA requested to prove the preferential rent. Tenant now claimed that, because the prior tenant paid a preferential rent, landlord couldn't collect more than a 5 percent vacancy increase when tenant moved in. Tenant also claimed that landlord improperly conditioned his preferential rent on early rent payment, which was illegal.

But Rent Stabilization Law Section 26-511(c)(5-a), effective June 15, 2015, provided for a 5 percent vacancy increase if the prior vacancy lease commenced less than two years before the effective date of the law. So the 5 percent vacancy increase limit didn't apply to tenant's rent. The rent clause that tenant referred to stated that tenant would receive a rent credit of $665 if rent was paid before the first day of each month. While it was unclear whether the rent credit was to be applied against the legal regulated rent or the preferential rent, the clause didn't condition tenant's preferential rent on the timely payment of rent. In any event, there was no proof that this rent clause was ever implemented, and tenant paid the preferential rent throughout his tenancy.

Carson: DHCR Adm. Rev. Docket No. FP210012RT (11/17/17) [3-pg. doc.]