Landlord Must Produce Pre-Base Date Rent History Records
LVT Number: #32771
Seventy-four tenants sued a number of landlords of different buildings for rent overcharge in one lawsuit and sought class action status. The court denied a motion by landlord to dismiss that claim, finding it premature. Later, the court and an appeals court denied tenants' motion to compel production of rent history documents by landlords. Subsequently, tenants presented an explanation for why rent history records going back more than four years could explain how they met class action requirements. Tenants argued that landlords perpetrated a fraudulent scheme to inflate rents above the levels permitted under the Rent Stabilization Law and asked the court to compel landlords to produce rent history records. Landlords opposed this request, stating that apartments hadn't been deregulated.
The court ruled for tenants, finding they were entitled to contemporaneous rent histories, including rent registrations and notices of deregulation for any apartments, along with DHCR rent registration records, Cases by Building Reports, and IAI and MCI records, to determine whether the actual improvements landlord claimed were made to apartments justified the rent increases in question and any resulting deregulations. The approved purpose of tenant inspection of these records was to determine whether landlords engaged in a fraudulent scheme to increase rents above the deregulation threshold. The court rejected landlords' claim that they weren't required to maintain records going back more than four years. Because landlords charged preferential rents, Rent Stabilization Code Section 2521.2(c) required retention of entire rental histories "immediately preceding such preferential rents." Examination of the pre-base date rent histories also was permitted not only to determine whether a fraudulent scheme to deregulate rendered the base date rents unreliable, but to determine whether any practice by landlords that deprived tenants of their rights under the RSC rendered the base date rents unreliable.
Chang v. Westside 309 LLC: Index No. 153031/2018, 2023 NY Slip Op 32546, NYLJ No. 1691543894 (Sup. Ct. NY; 7/17/23; Billings, J)