Rent Overcharge Ruling That Applied HSTPA Retroactively Is Overturned

Rent-stabilized tenant sued landlord, claiming rent overcharge. The court ruled for tenant and directed that the default formula be used to determine the legal rent and overcharge award. The court also awarded reasonable attorneys' fees.

Landlord appealed, and the case was reopened. While tenant's action was pending before the lower court, HSTPA amended the Rent Stabilization Law in June 2019. This changed the statute of limitations for bringing overcharge claims under CPLR Section 213-a and required examination of the apartment's entire rent history. So the lower court applied the HSTPA amendments in its ruling. But, in April 2020, New York's highest court ruled in Regina Metropolitan v. DHCR that this HSTPA provision couldn't be applied retroactively to overcharges claimed to have occurred before June 14, 2019. In this case, the court had found no willfulness by landlord in setting tenant's rent. So the default formula was inapplicable and the base date rent is the rent actually charged on the base date four years prior to tenant's initiation of his claim. The award of attorney's fees remained proper under tenant's lease terms. The case was sent back to the lower court to recalculate the overcharges due to tenant.

Kuzmich v. 50 Murray St. Acquisition LLC: 2020 NY Slip Op 06208, App. No. 12228/Case No. 2019-05132 (App. Div. 1 Dept.; 10/29/20; Renwick, JP, Gesmer, Kern, Singh, JJ)