Landlord v. Tenant: May 2022

PROCEDURE—DHCR

Late Filing of PAR Not Excused by Tenant's COVID Infection

Tenant complained to the DHCR of rent overcharge. The DRA ruled against tenant, who then filed a PAR to appeal. The DHCR rejected tenant's PAR as untimely. Tenant acknowledged with her filing that the PAR was postmarked on Jan. 28, 2022, which was more than 35 days after the date that the DRA's order was issued. Tenant said that she filed the PAR one day late because she contracted COVID-19 and tested positive for the virus on Jan. 7, 2022. Her mother also became ill. Tenant stated that she didn't want to infect anyone, including a notary and the mail clerk. She also claimed that due to COVID "brain fog" she miscounted the due date of the PAR. The DHCR noted that any request to extend the time to file a PAR or to excuse the late filing of a PAR won't be considered. The Rent Stabilization Code didn't provide for such extensions, and the DHCR had no authority to extend the time to file a PAR. The requirement that a PAR be filed within 35 days after a DRA order is issued is strictly enforced.

• Santa: DHCR Adm. Rev. Docket No. KM410040RT (2/4/22)

RENT OVERCHARGE

On-Time Rent Payment Discount Wasn't Preferential Rent

Rent-stabilized tenant complained of rent overcharge resulting from an on-time rent discount provision in her lease. The lease rider gave tenant a preferential rent but stated that, if the preferential rent wasn't paid by the 15th day of the month, the legal regulated rent would be due. The LRR was $2,256 and the preferential rent was $1,200.

The DRA ruled for tenant and ordered landlord to refund $1,429, including interest. The DRA also ruled that $1,200 became the legal regulated rent.

Landlord appealed and lost. Recent Appellate Division appeals court decisions in both the First and Second Departments have upheld DHCR determinations that on-time discount clauses are invalid, that the discounted rents didn't constitute preferential rents, and that the "preferential" rent amounts set forth in the lease became the legal regulated rent. One court noted that such rent concession wasn't interchangeable with a preferential rent, and was instead "an unconscionable late fee."

• Maple 10, LLC: DHCR Adm. Rev. Docket No. IS210011RK (1/18/22)