Tenant Wasn't Rent Stabilized Until 421-a Tax Benefits Took Effect

Landlord sued to evict tenant for nonpayment of rent. Tenant had moved into the apartment on Feb. 1, 2012, under a one and one-half year lease. The monthly rent was $3,180, with a preferential rent of $2,850 for the first year and $2,900 for the remaining six months. When tenant moved in, the apartment was newly constructed and unregulated. Landord then received a 421-a tax abatement, effective July 1, 2012. Tenant became rent stabilized but disputed the effective date that rent regulation took effect. Tenant also claimed deceptive business acts by landlord for failing to advise tenant that the apartment was subject to regulation, omitting from his lease a proper rider, and giving him a lease for an improper 18-month term. Tenant claimed that landlord overcharged him by collecting an extra month's rent at the outset of his tenancy. Landlord argued that rent stabilization provisions or certain notice requirements didn't apply when tenant moved in because the 421-a benefits hadn't taken effect. Landlord asked the court to dismiss tenant's defenses and counterclaims.

The court ruled for landlord. The effective date of the 421-a tax benefits was July 1, 2012, so the apartment became subject to rent stabilization on that date, not before. The deceptive business acts claim was dismissed. The case was adjourned for trial or settlement on the remaining issues of what rent was owed and whether there was any overcharge.

North-Driggs Holding LLC v. Burstiner: 2014 NY Slip Op 24123, 2014 WL 1922562 (Civ. Ct. Kings; 5/13/14; Avery, J)