Triple Damages and Rent Freeze Applied to Rent Overcharge

Rent-stabilized tenant sued landlord, claiming improper deregulation of tenant's apartment and rent overcharge. Tenant claimed that she was rent stabilized since the building had received J-51 tax benefits and that landlord had engaged in a fraudulent scheme to deregulate her apartment. The court ruled for tenant, finding that she was rent stabilized, that landlord must refund any rent overcharge with triple damages, and that the rent determined to be the base date rent would be frozen until corrected rent registration statements were filed with the DHCR.

Landlord appealed and lost. The court properly examined the pre-base date rent history upon finding that landlord engaged in a fraudulent scheme to deregulate. Landlord had failed to promptly register apartments in 2012 when applicability of the Roberts case decision became clear, and didn't refute tenant's claims that the rent was improperly increased in 1999 based on unproven individual apartment improvements (IAIs). The court also properly froze tenant's rent. Rent Stabilization Code Section 2528.4 provides that a landlord who files an improper rent registration is barred from collecting rent in excess of the base date rent and is retroactively relieved of that penalty upon filing a proper registration only when the increases were lawful except for the failure to file a timely registration.

Nolte v. Bridgestone Associates LLC: Index No. 7898, 2018 NY Slip Op 08571 (App. Div. 1 Dept.; 12/13/18; Richter, JP, Manzanet-Daniels, Tom, Webber, JJ)