No Time Limit for Claiming Pass-On Rights

Facts: Rent-stabilized tenant died in 2003. At the time he had a renewal lease that expired on Dec. 31, 2003. His lease was in his name only; his wife wasn't named as a cotenant. Tenant's wife remained in the apartment with her stepson, who was given pass-on rights to the apartment. The stepson moved out in May 2005, and his renewal lease expired in December 2006. Landlord gave tenant's wife a new lease and charged her a vacancy increase. She then complained of a rent overcharge, claiming that landlord should have given her a renewal lease. The DRA ruled for tenant and ordered landlord to refund $17,000. Landlord appealed, claiming that it properly charged tenant a vacancy increase. Landlord argued that since tenant's husband didn't request to have her name added to the lease before he died, landlord wasn't required to add her name to the renewal lease. And since the stepson was the first successor tenant, landlord was entitled to charge tenant a vacancy increase because she was the second successor tenant.

DHCR: Landlord loses. Landlord basically argued that tenant didn't claim her succession rights in a timely manner. A family member isn't time-barred from establishing succession rights. Although Rent Stabilization Code Section 2522.8(b) refers to a vacancy rent increase for second successor tenant, this means a family member who didn't qualify for succession rights as a first successor because he or she didn't live in the apartment as a family member for at least two years before the original tenant died or moved out. It is undisputed that tenant and her stepson both lived with tenant's husband for at least two years before he died. So tenant was a co-first successor with her stepson. The overcharge was found willful and the DRA properly imposed triple damages.

MH Residential 1, LLC/Keh: DHCR Adm. Rev. Docket Nos. VJ410016RO, VI410011RT (1/4/08) [4-pg. doc.]