TPU Incorrectly Claimed Rent Overcharge

The DHCR's Tenant Protection Unit (TPU) filed a rent overcharge complaint against landlord in 2017 after conducting a rent audit. The DRA found an overcharge and ordered landlord to refund tenant $19,905, including triple damages.

Landlord appealed and won. Landlord claimed that there was no overcharge and that the apartment had been lawfully deregulated. The DHCR agreed. First, the DRA had incorrectly applied a six-year statute of limitations to the complaint, which had been filed prior to amendment of certain rent overcharge rules by the HSTPA on June 14, 2019. In April 2020, New York's highest court had revoked retroactive application of the expanded lookback period in  Regina Metro. v. DHCR. Also, the prior tenant was rent controlled. When he moved out the legal rent was $125. Landlord was entitled to use as its starting rent the greater of the MBR plus 30 percent or HUD's Fair Market Rent of $1,191. Landlord also was entitled to add to that greater amount an IAI increase of $1,529, a vacancy increase of 16.25 percent, and a 0.6 percent longevity increase for 30 years. These increases boosted the legal rent to an amount greater than the deregulation threshold of $2,500. So, the apartment was legally deregulated as of June 1, 2014. The DRA's order was revoked, and that apartment was no longer subject to rent regulation.

Easton Industrial Affiliates: DHCR Adm. Rev. Docket No. IN410032RO (3/16/21) [2-pg. doc.]