Outstanding Rent Reduction Order Resulted in $219K Overcharge

Rent-stabilized tenant complained of rent overcharge in 2018. The DRA ruled for tenant and froze the $1,600 base date rent at $500 due to an outstanding rent reduction order. The DRA directed landlord to refund $219,400, including triple damages and interest.

Landlord appealed and lost. Landlord failed to rebut the presumption of willful overcharge. So triple damages were warranted. In Cintron v. Calogero, New York's highest court ruled in 2010 that rent reduction orders placed a continuing obligation upon owners to reduce and freeze rent and are part of the rental history that the DHCR must consider if the orders remain in effect within the four-year lookback period. Landlord was responsible for compliance with this order, and can't claim it was ignorant of the rent reduction order. Landlord also continued to overcharge the tenant even after it was on actual notice of the rent reduction order. This further proved willful rent overcharge. And landlord incorrectly argued that the DRA's triple damage calculation went back more than two years before the overcharge complaint was filed.

Sonnal Industries, Inc.: DHCR Adm. Rev. Docket No. KM210030RO (4/13/22)[3-pg. document]