Supreme Court Judge Curbs Four-Year Rule
by William Rowen

State Supreme Court Justice William P. McCooe has ruled in favor of a tenant couple who appealed a DHCR “fair-market rent appeal” decision that the Rent Regulation Reform Act of 1997 barred them from challenging their rent more than four years after they moved in.

Fair-market rent appeals are used when a new tenant moves into a previously rent-controlled apartment, and the state Division of Housing and Community Renewal judges whether the new rent is “fair” or excessive given current market conditions. In most cases, tenants are not allowed to contest rent overcharges that are more than four years old.

But in a lengthy opinion, Justice McCooe ruled that the 1997 law did not change tenants’ right to file a Fair Market Rent Appeal at any time when the landlord has failed to register the new rent and notify the tenant of their right to appeal it. DHCR had denied the tenants’ appeal under the four-year rule.

Justice McCooe decided the case, James Kempner and Beth Kempner v. NYS Division of Housing and Community Renewal, strictly on the law; there were no factual issues before the court. The court said that the 1997 changes did not change the section of the law preserving the tenants’ right to appeal their rent and that the four-year rule did not apply.

This decision is in direct conflict with another, Schutt v. DHCR, made some months before by Justice Bruce Allen of the same court, involving Met Council board member Deborah Schutt and her roommate, Elizabeth Wiseman. Allen found against Schutt, but did not address the issue that Justice McCooe based his finding on: whether the RRRA of 1997 changed the rules for notice in Fair Market Rent Appeals—although Schutt’s attorneys, Stephen Palitz and Seth Miller, had raised the issue at length.

The Kempners represented themselves, but had access to the papers of Schutt’s attorneys.

Schutt and Wiseman are appealing Justice Allen’s decision, and it is expected that DHCR will appeal the Kempner decision as well. Both cases would go to the Appellate Division.