Outstanding Rent Reduction Order Isn't Proof of Fraud by Landlord

Rent-stabilized tenant complained of rent overcharge. The DRA ruled for tenant and ordered landlord to refund $15,700 plus interest. Tenant appealed and lost. Tenant claimed that the DRA failed to reduce his rent to reflect a rent reduction order that had remained in effect for 22 years. Tenant also claimed landlord fraud. But tenant was the first rent-stabilized tenant in the apartment after statutory decontrol. So legally his first rent of $950 remained frozen. The DHCR couldn't reduce tenant's initial rent to the prior rent-controlled rent as a result of the rent reduction order. And charging tenant rent increases while there was an outstanding rent reduction order didn't indicate landlord fraud or bar landlord from setting the first rent-stabilized rent when tenant moved in. Landlord also rebutted any presumption of willful rent overcharge by refunding most of the overcharge due while the case was pending.

Castillo: DHCR Adm. Rev. Docket No. CS410016RT (2/10/15) [5-pg. doc.]