Rent Overcharge Resulted from Deemed Renewal Lease

Rent-stabilized tenant complained of rent overcharge. The DRA ruled against tenant, finding no overcharge. Tenant appealed and won, in part. Tenant claimed that her rent history showed a pattern of fraud and illegality by landlord in an effort to deregulate the apartment. Alternatively, tenant claimed that her rent should have been frozen at the amount set by a 1993 DHCR rent reduction order. Tenant also claimed that landlord improperly deemed a renewal lease increase for her.

The DHCR found no indication of fraud and therefore no duty for the DHCR to examine the rent history prior to the base date. The DHCR noted that the base date for tenant's complaint was Dec. 15, 2004, four years before the date of filing. The legal regulated rent on that date was $1,638, shown by prior tenant's lease and annual rent registration information on record. Tenant moved into the apartment on June 1, 2006, at a monthly preferential rent of $1,450. This was less than the legal regulated rent that landlord could have charged tenant, and landlord gave tenant a proper preferential rent rider. The DRA had reviewed the rent history back to 1984. Landlord adequately explained that there was no annual registration between 1989 and 1993 because the apartment was rent controlled during that time.

Tenant's apartment also wasn't subject to the 1993 rent reduction order. At the time that the building-wide services complaint that resulted in this order was filed, tenant's apartment was vacant. So there was no complaint filed in connection with that apartment and the rent reduction order didn't apply to tenant's apartment.

But tenant correctly argued that landlord improperly deemed a renewal lease to be in effect after tenant refused to sign it. So tenant's rent was frozen for the two-year period between June 1, 2007, and May 31, 2009, and the resulting overcharge was $6,082, including triple damages. 

Yau: DHCR Adm. Rev. Docket No. YK410011RT (10/9/13) [6-pg. doc.]