Overcharge Case Sent Back to DHCR for Further Investigation

Tenant complained to the DHCR of rent overcharge and improper deregulation of her apartment, which was located in a building that had received J-51 tax benefits. The DHCR ruled for tenant in part. Tenant then commenced an Article 78 court proceeding for review of the DHCR's decision, claiming that the agency's ruling was arbitrary and unreasonable. The DHCR asked the court to send the case back to the DHCR for additional fact-finding. The court agreed with the DHCR, finding that the administrative record was incomplete. In its decision, the DHCR had addressed a rent freeze that already was in effect for reasons unrelated to whether landlord had properly registered the apartment. As the DHCR pointed out, it must review whether the apartment was properly registered in order to fully rule on tenant's overcharge claim. In other cases where a landlord failed to register a building with the DHCR after relying on incorrect DHCR guidance that high-rent units in J-51 buildings could be deregulated, triple damages weren't applied to rent overcharges. The court sent the case back to the DHCR for further consideration of the issue of the registration of the building.

Mays v. DHCR: Index No. 156549/2022, 2023 NY Slip Op 30457(U)(Sup. Ct. NY; 2/10/23; Kelley, J)