Tenants in J-51 Building Can Pursue Class Action

Former and current tenants sued landlord, claiming that landlord charged them excessive rents and removed more than half of the 1,000 apartments in the building complex from rent stabilization or rent control after it began receiving J-51 benefits in 2003. The court previously denied landlord's request to dismiss or delay a ruling to permit the DHCR to resolve tenants' claims. Following the Court of Appeals decision in the Roberts case, the court noted that landlord improperly deregulated apartments while receiving J-51 benefits and tenants had claims over their rent regulatory status and rent overcharges. Tenants asked the court to consolidate their cases and certify the case as a class action. The court ruled for tenants since tenants had agreed to seek only overcharges plus interest, and no triple damages. The DHCR asked the court to dismiss landlord's action to join the DHCR in the case. The court ruled for the DHCR, finding no viable controversy between landlord and the DHCR and no reason for the DHCR to be joined in the case.

Dugan v. London Terrace Gardens, LP: Index No. 603468/2009, NYLJ No. 1202622607016 (Sup. Ct. NY; 9/9/13; Billings, J)