No First Rent for Reducing Apartment Size by 86 Square Feet

Facts: Tenant moved into apartment in 1996 under a rent-stabilized lease at a monthly rent of $1,950. Prior tenant's rent was $675. Tenant complained to the DHCR of a rent overcharge. Landlord claimed tenant paid a first rent for a newly created apartment. Landlord had renovated, removing 86 square feet from the one-bedroom apartment before tenant moved in. To do this, landlord had moved a wall between tenant's apartment and the apartment next door. Tenant's apartment kept the same number of rooms, with one being smaller. The apartment next door also kept the same number of rooms, with one now being bigger. The DHCR ruled against tenant. Tenant appealed, claiming that the DHCR's decision was arbitrary and unreasonable. The court ruled against tenant and tenant appealed again. Court: Tenant wins. The DHCR allows landlords to charge a first rent when a former apartment no longer exists due to alteration and the legal rent can't be determined from the rent history of prior apartment. This policy is reasonable when two apartments are combined or if a room is removed from an apartment. But here the DHCR's policy allowed landlord to significantly increase the rent on a unit merely by changing the dimensions of an apartment in a small way. This was illogical and unreasonable under the goals of the rent stabilization law.

Devlin v. DHCR: NYLJ, 9/24/03, p. 18, col. 1 (App. Div. 1 Dept.; Tom, JP, Andrias, Sullivan, Rosenberger, Friedman, JJ)