Tenant Can Continue to Deduct Overcharge After Building Sold

October 31, 2007

LVT Number: #19968

Landlord sued to evict rent-stabilized tenant for nonpayment of rent. Tenant claimed that she was withholding her monthly rent as credits toward a rent overcharge award of $33,000 previously obtained from the DHCR. The court ruled for tenant and dismissed the case. Landlord appealed, arguing that tenant had obtained the overcharge award against prior landlord and that landlord wasn't responsible for the overcharge payment to tenant. The appeals court ruled against landlord. If tenant had converted the DHCR overcharge award to a lump-sum judgment, it would be only against prior landlord.

Landlord sued to evict rent-stabilized tenant for nonpayment of rent. Tenant claimed that she was withholding her monthly rent as credits toward a rent overcharge award of $33,000 previously obtained from the DHCR. The court ruled for tenant and dismissed the case. Landlord appealed, arguing that tenant had obtained the overcharge award against prior landlord and that landlord wasn't responsible for the overcharge payment to tenant. The appeals court ruled against landlord. If tenant had converted the DHCR overcharge award to a lump-sum judgment, it would be only against prior landlord. But tenant was taking rent credits to recover the overcharge. Tenant was entitled to continue to deduct amounts due on the overcharge award from her monthly rent after the building was sold to current landlord.

277 Enterprises, LLC v. Lebron: NYLJ, 10/23/07, pg. 37, col. 4 (App. T. 2 Dept.; Pesce, PJ, Golia, Rios, JJ)

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