Landlord Didn't Explain How Apartment Was Deregulated

Tenant complained to the DHCR in 2018, claiming rent overcharge based on missing apartment registrations. In response, landlord claimed that the apartment had always been properly registered but also argued that the unit was deregulated. The DRA ruled for tenant, finding that the base date rent four years prior to the complaint filing was unreliable. So the DRA set the base date rent through the default formula. The total overcharge through the date tenant moved out was $82,070, including triple damages.

Landlord appealed and lost. Landlord argued that application of the default formula and review of pre-base date rent history by the DRA was improper. But landlord advised the DRA that prior to Feb. 1, 2017, the unit was legally deregulated at a rent of $3,000 per month. And, despite repeated requests, landlord failed to explain how the 2010 rent of $912.57 increased to $3,000. The DRA was permitted under RSC Section 2526.1(a)(2)(iii) to seek proof of how the apartment was allegedly deregulated before the base rent date. So, use of the default formula and triple damages for willful rent overcharge were proper. The DRA correctly used a comparable unit in the building to set the base date rent. 

B. Clark Assoc., Inc.: DHCR Adm. Rev. Docket No. MV210009RO (4/16/25)[5-pg. document]