Landlord v. Tenant: July 2014

Demolition: Landlord’s Demolition Application Denied

Landlord asked the DHCR for permission to terminate one rent-stabilized and four rent-controlled tenancies in order to demolish the building tenants lived in. Landlord claimed that the apartments were uninhabitable, that a new building it planned to construct on the site would contain 20 percent more units, that landlord couldn’t presently earn 8.5 percent annual net return on the building’s assessed value, and that landlord hadn’t mismanaged the building. Tenants denied landlord’s claims.

The DRA ruled against landlord, who appealed and lost. Building vacancies increased from eight in 1990 to 18 in 2004 when landlord filed its application. This showed a pattern by landlord that contributed to the deterioration of the apartments. An auditor’s report also had shown that the building could generate an 8.5 percent return in 2006. The DHCR found that landlord intentionally managed the building in a way that impaired landlord’s ability to make the 8.5 percent return.

• 890 First LLC: DHCR Adm. Rev. Docket Nos. ZJ420008RO et al. (4/26/14)

Rent Restored: DHCR Inspection Finds No Lead Paint Dust in Apartment

Tenant complained of a reduction in services. The DRA ruled for tenant and reduced his rent to $1 per month because landlord had failed to provide for the safe removal and containment of lead paint contamination throughout the apartment. The DRA later denied landlord’s first application to restore rent but granted landlord’s second application for rent restoration based on the restoration of services. Tenant sought reconsideration, and the DRA then revoked the rent restoration. Tenant’s lead testing contractor had found unacceptable lead levels in the apartment. Landlord filed a third rent restoration application, stating that it had tested all surfaces and found no lead paint hazard. The DRA ruled for landlord. Tenant appealed, claiming that there was still a lead paint issue in the apartment.

The DHCR ordered an independent inspection by a lead testing company and found no lead paint dust. The DHCR then ruled for landlord and restored tenant’s rent. The DHCR noted that there was no lead paint violation on record with the local health agency for tenant’s apartment.

• Stellar 117 Garth, LLC/Szewczuk: DHCR Adm. Rev. Docket Nos. BM910013RP, AR910009RO, AR910026RT (4/4/14)

Rent Stabilization Coverage: Tenant’s Trust Income Was Above Deregulation Threshold

Landlord applied for high-rent/high-income deregulation of rent-stabilized tenant’s apartment in 2010. Tenant claimed that her relevant household income was less than $175,000 in both 2008 and 2009. But DTF records showed that tenant’s income was greater than the deregulation threshold in both years. The DRA then ruled for landlord.

Tenant appealed and lost. Tenant argued that she was over 90 years old, homebound, and that her only source of income was distributions made from a QTIP trust set up under her late husband’s will over which she had no control. She also claimed that the 2008 and 2009 distributions were higher than those made in other years. Annual income for high-income deregulation purposes is “the federal adjusted gross income as reported on the New York State income tax return.” There are no exceptions or exclusions for amounts received from non-routine distributions from testamentary trusts. The DHCR followed the law by using DTF information to match income information for tenant. The fact that tenant’s income was below the deregulation threshold in years other than 2008 and 2009 didn’t matter.

• Kaplan: DHCR Adm. Rev. Docket No. BM410017RT (4/10/14)