By Andy B. Mayfair
Allegations of rent stabilization law violations are fueling a lawsuit launched by a pair of Financial District tenants against their landlord.
Tenants Bruce Hackney and Timothy Smith are said to be suing landlord UDR Inc.
The pair live at 10 Hanover Square, and claim UDr has violated the 421-g tax benefits program. That program reportedly gives tax help to landlords but stipulates that leases be rent stabilized.
“The two men say they did not receive a rent-stabilized lease when they moved into their apartment, and they have not been provided with rent-stabilized renewals, either, according to the suit,” reported therealdeal.com.
“A rent-stabilized lease is like a unicorn,” Hackney said in an interview, “and if you have an opportunity to corral a unicorn and capture a unicorn, you do it.”
The building in question, according to therealdeal.com, “has almost 500 units, but as of June, none of them was listed as rent-stabilized in UDR’s tax filings, the lawsuit says. A state judge had previously ruled that UDR could use luxury deregulation to exempt units at 10 Hanover Square from New York’s rent stabilization program, and the decision was upheld on appeal. However, on June 25 the state’s highest court ruled against this interpretation, paving the way for the lawsuit by Hackney and Smith.
“Landlords who receive 421-g benefits now must provide their tenants with riders explaining what the tax credit is and when it expires. If the riders aren’t included the tenants are entitled to rent-stabilized leases for as long as they live in their apartment, according to court papers. The suit claims that Hackney and Smith are entitled to a rent-stabilized lease for the rest of the time they stay in their apartment,” the web site added.
The suit also alleges that the apartments have not been registered with the Division of Housing and Community Renewal, as required.
“We’re not talking about a Netflix overcharge that is 27 cents. We’re talking about people’s homes. You have something that is very serious,” Roger Sachar, one of the attorneys on the case, told thecity.nyc. “You’re talking about significant overcharges, a result of a 15-year violation of the rent regulations.”
The lawsuit in question “follows a June decision by the state’s highest court confirming that landlords receiving the 421-g tax break must place their apartments under rent regulation — even those where rents were high enough to normally qualify for deregulation as luxury units,” thecity.nyc added. “Hackney and Smith were being charged more than $4,000 a month in rent. They told THE CITY in August they were surprised to learn from the state agency that oversees rent regulated apartments that they were entitled to a stabilized lease and a reduction in their rent.”
