Court Must Decide Base Date Rent in Overcharge Claim

Tenant sued landlord, seeking rent-stabilization coverage and claiming rent overcharge. Tenant’s initial lease began on March 15, 2008, at a monthly rent of $3,095. Landlord gave tenant an unregulated lease, but in response to the court action agreed that as a result of the Court of Appeals’ decision in Roberts v. Tischman Speyer, tenant was subject to rent stabilization because the building received J-51 tax benefits at the time tenant moved in. But landlord claimed that there was no overcharge, because the base date rent was the $3,095 paid by tenant. Landlord asked the court to dismiss the case without a trial. The court ruled against landlord, who appealed and lost. Landlord claimed that the base rent date was March 16, 2006, four years before tenant’s court complaint was served. But the correct base rent date was March 10, 2006, which was four years before the complaint was first filed in court on March 10, 2010. The prior tenant, who vacated in 2005, had paid $1,418 per month. Landlord argued that, if the base rent date was March 10, 2006, the apartment was vacant on that date and therefore the next rent--$3,095--was the base rent. But this rule presumes that tenant was offered a rent-stabilized lease, which was not done here. The appellate court sent the case back to the trial court, but left open the question of how to properly calculate the base date rent.

Gordon v. 305 Riverside Corp.: NYLJ, 4/2/12, p. 18, col. 3 (App. Div. 1 Dept.; Mazzarelli, JP, Andrias, DeGrasse, Richter, Abdus-Salaam, JJ)