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Two Recent Decisions: Courts Find Tenants To Be Rent Stabilized

Landlords will often rent apartments to tenants claiming that they are not rent stabilized when in fact they are. In two recent cases, the Housing Court found for the tenants. Ron Languedoc represented the tenant in Raywood. Sam Himmelstein and Ron Languedoc represented the tenant in Shomron.

Chun v Raywood (Civil Court Kings County, Halprin, J., decision dated Nov. 21, 2012):

In Raywood, the landlord initially claimed that the tenant's apartment was not rent stabilized because it was in a building containing fewer than six units. However, when Buildings Department records showed that there had been over six units until the 1990's, the landlord changed its position to claim that the apartment was not stabilized because the rent was over $2000 per month at the time the tenants took occupancy. The landlord also claimed that because the former owner had resided in the apartment before the current tenant took occupancy, the landlord was free to charge market rent. The Court rejected the landlord's claims and found that the apartment was rent stabilized. The Court accepted the tenant's position that the apartment could not be "high rent/vacancy" deregulated because the owner had never registered it with the DHCR and therefore no legal rent had ever been established. The Court also accepted the tenant's position that the law did not allow the landlord to deem the apartment deregulated after a period of owner occupancy. The law allowing for temporary exemption from rent stabilization during a period of owner occupancy specifically provides that the next tenant will have a stabilized lease.

Chelsea Dynasty LLC v Shomron (Civil Court NY County, Schreiber, J., decision dated Dec. 31, 2012):

In Shomron, the landlord claimed that the premises rented to the tenant were not rent stabilized because they were rented for over $2000 per month after a vacancy. However, the tenant demonstrated that in 1972 he moved into his apartment. Over the ensuing years, the tenant sought additional space for his family, and the landlord rented to him three adjoining SRO rooms, which the tenant and his family occupied had occupied as their joint residence since the early 1980's. The landlord claimed that at the point when the tenant began renting all the units jointly, the owner could charge a "first rent" and deregulate the premises. The Court rejected the landlord's claims and found that the premises were rent stabilized. The Court accepted the tenant's position that vacancy deregulation only became the law in 1997; since the tenant and his family had been in occupancy of the joint residence since long before that time, there could be no deregulation. Also, in order to qualify for deregulation, petitioner would have to show that the legal rent was over $2000 after a vacancy; because the premises were never registered with the DHCR, the owner could not establish that the legal rent was over $2000.