Tenant Refunded Overcharge to Subtenants While Complaint Was Pending

Subtenants complained that rent-stabilized tenant had overcharged them. The DRA ruled for the subtenants, finding that there was an overcharge of $19,467, including triple damages. Rent-stabilized tenants can't charge subtenants more than the legal regulated rent plus a 10 percent surcharge if an apartment is fully furnished. Tenant charged subtenants more than the legal rent. But, since tenant had refunded $18,000 and the subtenants owed rent arrears of $25,753, no further refund was due to the subtenants.

Tenant appealed and won, in part. She argued that the DRA's order should have directed subtenants to pay her money owed. Tenant also objected to the triple damages since she had refunded more than was owed and did so when the subtenants moved out. And tenant said that the subtenants themselves profiteered by engaging in short-term apartment rentals through Airbnb. 

The DHCR eliminated the triple damages and instead assessed interest on the overcharge. The total overcharge was $9,218 and, again, since tenant had refunded $18,000 at least three years before the DRA issued its order, no further refund was due. Any additional dispute between the parties was beyond the DHCR's authority to rule on. 

Schmitt: DHCR Adm. Rev. Docket No. JV410033RO (12/29/21)[5-pg. document]