Summary
In Reich, proper application of the pre-HSTPA statutes resulted in no overcharge, but a comparison of the market rent actually charged during the recovery period – over $18,000 per month – against a reconstructed stabilized rent under the HSTPA considering rental history dating back to the tenants' initial occupancy of the apartment in 2005 (or before) could result in an enormous retroactive increase in liability.
Summary of this case from Regina Metro. Co. v. N.Y. State Div. of Hous. & Cmty. RenewalOpinion
7212 Ind. 159841/16
01-15-2019
Elizabeth REICH, et al., Plaintiffs–Appellants, v. BELNORD PARTNERS, LLC, et al., Defendants–Respondents.
Vernon & Ginsburg, LLP, New York (Darryl M. Vernon of counsel), for appellants. Rosenberg & Estis, P.C., New York (Deborah Riegel of counsel), for respondents.
Vernon & Ginsburg, LLP, New York (Darryl M. Vernon of counsel), for appellants.
Rosenberg & Estis, P.C., New York (Deborah Riegel of counsel), for respondents.
Renwick, J.P., Gische, Kahn, Kern, Moulton, JJ.
Order, Supreme Court, New York County (Arlene P. Bluth, J.), entered September 14, 2017, which granted defendants' motion to dismiss the claim for rent overcharges and denied plaintiffs' cross motion for summary judgment pursuant to CPLR 3211(c), unanimously affirmed, without costs.
Plaintiffs' claim for rent overcharges based on defendants' failure to charge rent stabilized rents while receiving J–51 tax benefits was correctly dismissed pursuant to CPLR 213–a. Consistent with both Matter of Regina Metro. Co., LLC v. New York State Div. of Hous. & Community Renewal , 164 A.D.3d 420, 425–426, 84 N.Y.S.3d 91 [1st Dept. 2018], lv dismissed 32 N.Y.3d 1085, 2018 N.Y. Slip Op. 90474, 2018 WL 6495121and Taylor v. 72A Realty Assoc., L.P., 151 A.D.3d 95, 105–106, 53 N.Y.S.3d 309 [1st Dept. 2017], there was no basis for considering the subject apartment's rental history more than four years before the commencement of the overcharge claim. In Matter of Regina Metro. Co., LLC, 164 A.D.3d at 425–426, 84 N.Y.S.3d 91, we held that fraud is the only exception to the four-year look back period to determine the legally regulated rent on the base date. There is no fraud here. In Taylor v. 72A Realty Assoc., L.P., 151 A.D.3d at 105–106, 53 N.Y.S.3d 309, we permitted a longer look back period under certain circumstances not necessarily indicative of fraud. Those circumstances are not present, where, as here, the tenant received a rent stabilized lease and the landlord registered the rent with DHCR more than four years before any rent overcharge complaint was filed.
In view of the dismissal of the rent overcharge claim, plaintiffs' motion for summary judgment on that claim and the dependent claims for treble damages and attorneys' fees was correctly denied. Plaintiffs abandoned their application for summary judgment on the claims for declaratory and injunctive relief by failing to make any arguments in support thereof on appeal.