Willful Rent Overcharge of Over $109,000 Resulted from Prior Rent Reduction Order

Rent-stabilized tenant complained to the DHCR in December 2018 of rent overcharge. The DRA ruled for tenant and ordered landlord to refund $109,283, including triple damages and interest. The DRA found that the base rent date was in December 2014, that a 1995 DHCR rent reduction order froze tenant's rent at $406 on the base date, and that tenant had been receiving SCRIE rent benefits. Based on the SCRIE benefits, the amount of the rent reduction would be subtracted from the rent payable by the tenant as specified in a valid SCRIE rent exemption order and the total overcharge amount would be payable to the tenant.

Landlord appealed and lost. The DRA's finding that the overcharge would be payable to tenant, despite the fact that tenant didn't pay the full amount of her monthly rent while getting SCRIE benefits, was supported by RSL Section 26-509(b)(3)(iii). And, although landlord had filed a rent restoration application in December 2022, this wouldn't affect the rent overcharge, which was calculated through November 2022. Triple damages also were proper in this case since landlord's claimed ignorance of the 1995 rent reduction order didn't rebut the willfulness of the overcharges. Landlord bought the building before the rent reduction order was issued and was responsible for knowledge of that order.  

Audubon 550 W 171 LLC: DHCR Adm. Rev. Docket No. LQ410002RO (7/25/23)[3-pg. document]