DHCR Can Review Pre-Base Date Rent History

Tenant complained of rent overcharge in 2009, claiming that when she moved into the apartment in 2004 at a monthly rent of $2,700, she was given an improper deregulated lease. Tenant said that the building was receiving J-51 tax benefits at that time. The DRA found that the base rent date was Sept. 22, 2005, four years before tenant’s complaint. But, after reviewing prior rent history records, the DRA found that the $2,700 rent charged on the base date was invalid and ordered an overcharge refund of $81,253, including triple damages and interest. Landlord appealed and lost. Landlord claimed that pre-base date review of the apartment rent history was improper because there was no claim or proof of a fraudulent scheme. But Rent Stabilization Code Section 2526.1(a)(2)(ix) and 2526.1(a)(3)(iii) permit the review of pre-base date rent history where the base date is unreliable due to erroneous deregulation of a J-51 apartment prior to the base date. So the DRA correctly went back to the last legal regulated rent registered with the DHCR in order to calculate the subsequent legal regulated rents. 

Four Thirty Realty, LLC: DHCR Adm. Rev. Docket No. EN410001RP (3/31/17) [3-pg. doc.]