Landlord Claims Tenants Misrepresented Income

Landlord applied for high-rent/high-income deregulation of tenants' rent-stabilized apartment in 2009. The DRA ruled against landlord after DTF matched tax records showing that tenants' household income was below $175,000 in both 2007 and 2008. Landlord appealed and lost. Landlord claimed that tenants, a married couple, had committed fraud by misrepresenting their income in order to avoid deregulation. Landlord argued that the DHCR should delay deciding the case until a court action landlord had started against tenants on these grounds was resolved. But the DHCR was permitted by statute only to deregulate an apartment when DTF determined that the income threshold wasn't met. The DHCR wasn't authorized to make its own independent determination of what a tenant's income was, and didn't have the technical expertise to independently investigate or interpret a tenant's income or tax law.

737 Park Avenue Acquisition, LLC: DHCR Adm. Rev. Docket No. AS410026RO (1/29/13) [8-pg. doc.]