New Evidence Doesn't Warrant Reconsideration of Hardship Application

Facts: Landlord filed a hardship application with the DHCR, seeking to subdivide two rent-controlled apartments, to evict tenants from the front portion of their units, and to combine these front rooms to form a new duplex apartment. The DHCR reviewed the building's income and expenses during 1996, the year of landlord's application, and found that landlord was unable to make a net annual return of 8.5 percent of the property's assessed valuation without doing what she proposed. The DHCR ruled for landlord. Tenant appealed, claiming that the DHCR should reconsider because by this point the other rent-controlled tenant had died, and landlord would have increased income from that apartment. The DHCR opposed tenant's appeal. Court: The DHCR wins. The DHCR's assessment of the building's rate of return for the year in which landlord's hardship application was filed was a reasonable interpretation of the law. The DHCR wasn't required to consider facts that arose more than five years after landlord filed her application and after the DHCR ruled on it. And the DHCR's decision was based on substantial evidence.

Rizzo v. DHCR: NYLJ, 2/15/05, p. 18, col. 1 (App. Div. 1 Dept.; Tom, JP, Andrias, Saxe, Marlow, Nardelli, JJ)