Overcharge Not Refunded During TPU Audit

The DHCR’s Tenant Protection Unit (TPU) started an Individual Apartment Improvements (IAI) audit for an apartment in landlord’s building based on review of annual rent registrations. The TPU required landlord to submit proof justifying the cost of IAIs that substantially increased the apartment rent between 2010 and 2011. Landlord submitted records documenting $46,753 in IAIs. The TPU disagreed with landlord’s calculation of the legal rent and referred the case to the DRA. The DRA set the base rent date as four years before the overcharge proceeding was opened. The DRA found there was a rent overcharge and ordered landlord to refund $8,480 to tenant, including triple damages.

Landlord appealed and lost. The DRA properly found an overcharge because the preferential rent collected by landlord was higher than the legal collectible rent, even after all landlord’s IAIs were accepted. Landlord had miscalculated the legal regulated rent on tenant’s vacancy lease. And landlord didn’t refund the overcharge while the matter was pending before the TPU, even though it was given notice of its miscalculation. So the DRA correctly found that the overcharge was willful. 

Clermont York Assoc. LLC: DHCR Adm. Rev. Docket No. CU410047RO (4/8/15) [8-pg. doc.]