Triple Damages Upheld by Court

November 13, 2013

LVT Number: #25128

Rent-stabilized tenant complained of rent overcharge. The DHCR ruled for tenant and ordered landlord to refund the overcharge with triple damages. Landlord appealed and lost. The court and appeals court ruled that landlord failed to rebut the presumption that the overcharge was willful. Landlord claimed that tenant's initial rent was preferential and that it thereafter lawfully increased tenant's rent to the legal regulated rent. But there was no mention of a preferential rent in tenant's initial lease.

Rent-stabilized tenant complained of rent overcharge. The DHCR ruled for tenant and ordered landlord to refund the overcharge with triple damages. Landlord appealed and lost. The court and appeals court ruled that landlord failed to rebut the presumption that the overcharge was willful. Landlord claimed that tenant's initial rent was preferential and that it thereafter lawfully increased tenant's rent to the legal regulated rent. But there was no mention of a preferential rent in tenant's initial lease. So landlord couldn't rely on the 2003 rent law amendments authorizing a landlord to increase a preferential rent to a legal regulated rent upon lease renewal. The fact that landlord gave tenant a rent credit also didn't prove the overcharge wasn't willful. A tenant can recover an overcharge penalty by deducting it from her rent, but tenant didn't do so in this case. 

10th Street Associates, LLC v. DHCR: 2013 NY Slip Op 06974, 2013 WL 5788523 (App. Div. 1 Dept.; 10/29/13; Tom, JP, Andrias, Saxe, Freedman, Richter, JJ)

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