Tenant's Legal Rent Reduced to Preferential Rent

Rent-stabilized tenant complained of rent overcharge. The DRA ruled for tenant and found that tenant's July 2014 renewal lease showed the legal regulated rent to be $883. This wasn't listed as a preferential rent, as claimed by landlord. Landlord was directed to give tenant a revised renewal lease commencing on Aug. 1, 2015, with a rent increase based on the last legal regulated rent of $883. Landlord was also directed to amend apartment registrations for 2014 through 2016 to remove the preferential rents and correct the rents stated on leases.

Landlord appealed and lost. Landlord pointed out that tenant's 1998 vacancy lease listed a legal regulated rent of $750 and a preferential rent of $575. But that didn't preserve landlord's right to collect a higher legal regulated rent that wasn't set forth in subsequent renewal leases. Tenant's renewal leases in fact listed only legal regulated rents that were the same as the preferential rents. The DHCR didn't accept landlord's argument that this was a clerical error. Under Rent Stabilization Code (RSC) Section 2520.13, any agreement by tenant to waive a benefit under rent stabilization is void. And RSC Section 2521.2 requires landlord to maintain documentation of both the legal regulated rent and preferential rent in any renewal lease.

Pearl 1714 LLC: DHCR Adm. Rev. Docket No. FO610072RO (1/26/18) [6-pg. doc.]