Tenant Couldn't Switch Forums for Overcharge Claim

Tenant complained to the DHCR of rent overcharge and landlord's refusal to give her a rent-stabilized renewal lease. Landlord claimed that the apartment was deregulated. The DRA ruled for tenant but found no refund due since tenant's rent arrears were greater than the small rent overcharge found. 

Landlord and tenant both appealed. Tenant claimed that landlord committed fraud and that the DHCR should therefore look past the base date rent to find a bigger overcharge. Landlord argued that the DRA incorrectly disallowed individual apartment improvements (IAIs). The DHCR denied both PARs [see LVT #30531]. Landlord and tenant then filed Article 78 court appeals of the DHCR's decision. In response, the DHCR asked the court to send the case back for further consideration. The court granted the DHCR's request and denied both appeals as moot. Tenant then appealed the court's decision.

The appeals court ruled against tenant, finding that the court properly granted the DHCR's requests. The DHCR identified an irregularity in a vital matter that required further agency proceedings. The appeals court rejected tenant's argument that she could now litigate her overcharge claim in State Supreme Court rather than before the DHCR. Although the courts and DHCR have concurrent jurisdiction over rent overcharge claims, and are subject to a tenant's choice of forum, tenant chose the DHCR. And, after choosing the DHCR, tenant took no steps to have this matter litigated before the court rather than reviewed by the DHCR. Instead, she sought review of the DHCR's decision in the Article 78 proceeding.  

Hefti v. DHCR: Index No. 162398/19, App. No. 1557)&M-486, Case No. 2021-01049, 2022 NY Slip Op 02065 (App. Div. 1 Dept.; 3/24/22; Gische, JP, Mazzarelli, Friedman, Gonzalez, Mendez, JJ)