Triple Damages Warranted Despite Prior Foreclosure

Tenant complained of rent overcharge, and claimed that his apartment was improperly deregulated. The DRA ruled for tenant and ordered landlord to refund $45,000, including triple damages. Landlord appealed and lost. Landlord argued that triple damages shouldn't apply because the building had gone into foreclosure, a receiver was appointed in January 2009, and landlord bought the building in February 2010. Landlord also claimed that the building was exempt from rent regulation because it had been substantially rehabilitated by prior landlord. But landlord didn't submit sufficient proof that the building was substantially rehabbed after Jan. 1, 1974. The building was rent stabilized since it was built before 1947 and contained six or more apartments. And triple damages were warranted in this case. Neither the prior landlord, before the judicial sale, nor the receiver, collected any rent overcharge. The receiver had given tenant a lease at a monthly rent of $700. So there was no basis for landlord to later renew tenant's lease in 2011 at a rent of $950.

361 Ocean Avenue, LLC: DHCR Adm. Rev. Docket No. EU210059RO (7/14/17) [5-pg. doc.]