Receiver Not Liable

Tenant complained of a rent overcharge. The DRA ruled for tenant, and assessed triple damages. While the overcharge complaint was pending, the building was taken over by a receiver in bankruptcy. The DRA found an overcharge, and directed the receiver to refund it because receiver was listed as landlord. Receiver appealed, arguing that former landlord had incurred the overcharge before receiver took over the building. The DHCR ruled for receiver. Since receiver was in the same position as a current owner who buys at a judicial sale, receiver qualifies for the same protective provisions under the rent stabilization law. So, receiver is liable only for that portion of the overcharge incurred while it had control of the building. Since receiver took over the building after tenant moved out, it wasn't responsible for the overcharge. But former landlord is liable for the entire amount, including the triple damages.

Solomon et al.: DHCR Adm. Rev. Dckt. No. GG 410097-RO (10/28/94) [5-page document]