Roof Terrace Work Disallowed from Total Cost of MCI

Landlord applied for MCI rent hikes based on roof work, including work performed on the building roof terrace. The DHCR ruled for landlord. Tenants filed an Article 78 court appeal, and the case was reopened for reconsideration by the DHCR. Tenants claimed that the work performed on the roof terrace wasn't an MCI because the roof terrace wasn't part of the roof and didn't benefit all tenants. They also objected to the inclusion of an architect's fee in the MCI costs. Tenants' engineer's report also stated that there were defects in the work performed. The DHCR properly included the architect's fee in the MCI costs and reasonably found that the work wasn't defective. But the DHCR's decision was contradictory. It stated, on the one hand, that 16 terrace doors and eight terrace dividers were disallowed, but then included these items in the overall calculation of the MCI increases. The case was sent back for recalculation. Work performed on the roof terrace wasn't an MCI and should be disallowed from the calculation of any rent increases.

37-41 West 86th Street Tenants Associates v. DHCR: Index No. 102445/2012, NYLJ No. 120258498939 (Sup. Ct. NY; 1/8/13; Ling-Cohan, J)