Opinion
1012 Index No. 814423/21 Case No. 2022–03186
11-14-2023
In the Matter of 4040 BA LLC, Petitioner–Appellant, v. NEW YORK STATE DIVISION OF HOUSING AND COMMUNITY RENEWAL, Respondent–Respondent.
Horing Welikson Rosen & Digrugilliers, PC, Williston Park (Randi B. Gilbert of counsel), for appellant. Letitia James, Attorney General, New York (Kwame N. Akosah of counsel), for respondent.
Horing Welikson Rosen & Digrugilliers, PC, Williston Park (Randi B. Gilbert of counsel), for appellant.
Letitia James, Attorney General, New York (Kwame N. Akosah of counsel), for respondent.
Manzanet–Daniels, J.P., Oing, Scarpulla, Rodriguez, Higgitt, JJ.
Judgment, Supreme Court, Bronx County (Elizabeth A. Taylor, J.), entered July 13, 2022, denying the petition to annul an order of respondent New York State Division of Housing and Community Renewal (DHCR), dated August 25, 2021, which denied petitioner's challenge to a December 18, 2019 order of the Rent Administrator which partially denied its application for a rent increase based on the installation of a major capital improvement (MCI), and seeking an order remitting the matter to DHCR to determine petitioner's MCI application applying the law and rules in effect prior to the effective date of the Housing Stability and Tenant Protection Act of 2019 (HSTPA), and dismissing the proceeding brought pursuant to CPLR article 78, unanimously affirmed, without costs.
DHCR rationally concluded that the amendments from HSTPA Part K should be applied when considering petitioner's MCI application. Part K's amendments were effective immediately and applied to any determination issued after the act's effective date (L 2019, ch 36, pt K, §§ 11, 18). On the effective date, there had been no determination issued on petitioner's MCI application. DHCR also rationally concluded that the bathroom and kitchen renovation work at issue did not qualify for MCI rent increases under the Part K amendments (see CPLR 7803(3) ; Administrative Code of the City of New York § 26 –511.1(a)(2); Matter of Pell v. Board of Educ. of Union Free School Dist. No. 1 of Towns of Scarsdale & Mamaroneck, Westchester County, 34 N.Y.2d 222, 232, 356 N.Y.S.2d 833, 313 N.E.2d 321 [1974] ).
In this case, the application of the Part K amendments did not expand the scope of petitioner's liability based on prior conduct, or impair other rights petitioner possessed in the past (cf. Matter of Regina Metro. Co., LLC v. New York State Div. of Hous. & Community Renewal, 35 N.Y.3d 332, 337, 130 N.Y.S.3d 759, 154 N.E.3d 972 [2020] ; Matter of Harris v. Israel, 191 A.D.3d 468, 142 N.Y.S.3d 497 [1st Dept. 2021], lv dismissed 37 N.Y.3d 1011, 152 N.Y.S.3d 869, 174 N.E.3d 1243 [2021] ). When the HSTPA was enacted, petitioner had no vested right in a future MCI rent increase, or in the more beneficial pre-HSTPA law or regulations (see Matter of IG Second Generation Partners L.P. v. New York State Div. of Hous. & Community Renewal, 10 N.Y.3d 474, 482, 859 N.Y.S.2d 598, 889 N.E.2d 475 [2008] ; 300 Wadsworth LLC v. New York State Div. of Hous. & Community Renewal, 210 A.D.3d 454, 178 N.Y.S.3d 487 [1st Dept. 2022] ; Matter of Schutt v. New York State Div. of Hous. & Community Renewal, 278 A.D.2d 58, 58, 717 N.Y.S.2d 565 [1st Dept. 2000] ). Here, application of HSTPA Part K affected only the propriety of a prospective rent increase, that is, how much additional rent petitioner could charge after DHCR decided its MCI rent increase application. Application of the statute had no potentially problematic retroactive effect ( Regina Metro., 35 N.Y.3d at 365, 130 N.Y.S.3d 759, 154 N.E.3d 972 ).
In the absence of evidence in the record addressing petitioner's individual financial circumstances, we find that DHCR rationally declined to find that petitioner would suffer prejudice or undue hardship due to the application of the amended provisions (see 9 NYCRR 2527.7, 2529.10 ; Matter of IG Second Generation Partners L.P., 10 N.Y.3d 474, 482, 859 N.Y.S.2d 598, 889 N.E.2d 475 ; Matter of Storch v. New York State Div. of Hous. & Community Renewal, 56 A.D.3d 278, 279, 866 N.Y.S.2d 193 [1st Dept. 2008], lv denied 14 N.Y.3d 704, 2010 WL 606400 [2010] ).