Please also note that the AT1 implies in the section in bold, that not even Rent Stabilized tenants should be evicted for overcharging roommates unless and until Albany or DHCR amends the laws/codes to explicitly provide for evictions.
Here's the actual AT1 decision:December 12, 2004
YOUR HOME
Having a Roommate Under Rent Control
By JAY ROMANO
NEW YORK STATE appeals court has ruled unanimously that rent-controlled tenants, unlike rent-stabilized tenants, are not limited in the rent they can charge roommates.
A three-judge panel of the Appellate Term in Manhattan decided in June that while a rent-stabilized tenant can charge a roommate only the roommate's proportionate share of the rent, rent-controlled tenants have no such constraint.
Susan R. Lipp, a Manhattan lawyer who is editor of New York Apartment Law Insider, a monthly publication for property owners and managers, said that in the case, 270 Riverside Drive Inc. v. Braun, a landlord tried to evict a rent-controlled tenant who was collecting more rent from roommates than the tenant was paying to the landlord.
"The court ruled that the owner couldn't evict the tenant because the Rent Control Law and rules do not limit what tenants can charge roommates," she said. "I think the decision took a lot of people by surprise."
To understand why the decision might be surprising, it helps to know how roommates are treated under the Rent Stabilization Code and the New York State roommate law.
Mary Ann Hallenborg, a Manhattan lawyer and author of "New York Tenants' Rights" (Nolo, 2002), said that under the roommate law, landlords are prohibited from limiting occupancy of a rental unit to just the tenant or tenants named on the lease. She said the law permits a tenant to share an apartment with immediate family members and with one unrelated occupant - and that occupant's dependent children - provided the tenant continues to use the apartment as the primary residence.
There is nothing in the roommate law, Ms. Hallenborg said, that limits how much rent a tenant can collect from a roommate. To address that issue, she said, the Division of Housing and Community Renewal, the state agency that administers the rent laws, amended the Rent Stabilization Code in December 2000. Under that amendment, rent-stabilized tenants may not charge a roommate a rent that exceeds the roommate's proportionate share of the legal rent for the unit.
"A roommate's proportionate share is calculated by dividing the legal regulated rent by the total number of occupants residing in the unit," she said, adding that certain occupants, like a tenant's spouse and children and a roommate's dependent children, are not included.
"The regulation shields roommates from profiteering tenants," Ms. Hallenborg said.
Ms. Lipp said that in the 270 Riverside Drive case, the tenant was charging his two roommates rent that totaled $1,270, $80 more than the legal rent of $1,190. In its decision, she said, the court ruled that while the amendment to the Rent Stabilization Code applies to stabilized tenants, it does not apply to tenants under rent control. The court noted that since the state agency amended only the Rent Stabilization Code, and not regulations for rent-controlled tenants, the court could not "rectify any perceived omission of such a provision by providing one by implication."
Marcia P. Hirsch, general counsel for the state agency, acknowledged that while the rent-control rules do not go as far as the Rent Stabilization Code, they do contain a limitation.
The New York City Rent Control Law, she said, prohibits "any person" from demanding or receiving any rent that is in excess of the applicable maximum rent allowed by law.
Accordingly, she said, the court could have found that if the tenant charged any rent in excess of $1,190, the legal rent for the apartment, she was violating the Rent Control Law. The original decision in Housing Court, however, declared that the excess rent the tenant charged was "de minimus," or negligible.
Ms. Hirsch said that the landlord's request for permission to appeal the unanimous decision was denied.
Copyright 2004 The New York Times Company
NB: Loft, ETPA, RS tenants: this does not apply to you yet... see RSC § 2525.7270 Riverside Dr. v Braun
2004 NY Slip Op 24238
Decided on June 9, 2004
Appellate Term, First Department
Decided on June 9, 2004
APPELLATE TERM OF THE SUPREME COURT, FIRST DEPARTMENT
PRESENT:
HON. WILLIAM J. DAVIS, J.P.
HON. PHYLLIS GANGEL-JACOB
HON. MARTIN SCHOENFELD, Justices.
570341/03
270 RIVERSIDE DRIVE, INC., Petitioner-Landlord-Appellant,
against
SAUL BRAUN, 270 Riverside Drive, Apt. 3B, New York, New York 10025, Respondent-Tenant-Respondent, SIMONE MARX, ALLISON ADAIR, "JOHN DOE" and "JANE DOE", Respondents-Undertenants- Occupants.
Landlord appeals from an order of the Civil Court, New York County, dated June 28, 2002 (Dawn M. Jimenez, J.) granting tenant's motion to dismiss the petition in a holdover summary proceeding and from an order of the Civil Court, New York County, dated November 21, 2002 (Dawn M. Jimenez, J.) which, upon reargument, adhered to the original determination.
PER CURIAM:
Order dated November 21, 2002 (Dawn M. Jimenez, J.) affirmed, with $10 costs.
Appeal from order dated June 28, 2002 (Dawn M. Jimenez, J.) dismissed, without costs, as academic. [*2]
Landlord sought possession of the subject four bedroom rent controlled apartment on the ground that the tenant engaged in profiteering by collecting rent from two roommates in the aggregate sum of $1,270, in excess of the legal regulated rent of $1,192. On the undisputed record evidence, including tenant's previous deposition supplied by landlord, Civil Court correctly decided that a cause of action for eviction could not be proven. As landlord concedes, there is no provision in the rent control regulations equivalent to Rent Stabilization Code [9 NYCRR] § 2525.7, which prohibits charging a roommate a disproportionate share of the legal rent. Nor, more critically, do the regulations provide for eviction proceedings without a certificate on this ground (see NY City Rent and Eviction Regulations [9 NYCRR] § 2204.2). DHCR's omission from the rent control regulations of a requirement for proportionate rental contributions among roommates cannot be disregarded as mere oversight (see Sullivan v Brevard Associates, 66 NY2d 489, 493-494), particularly since the addition of section 2525.7 to the Code on or about December 20, 2000 was part of a comprehensive revision of the four rent codes promulgated by the agency. "[W]e may not rectify any perceived omission of such a provision by providing one by implication" (518 West 134th Street Tenants Assoc. v Calderon, 181 Misc 2d 216, 217; see Pajak v Pajak, 56 NY2d 394, 397-398).
While the remedy of termination of a tenancy has been recognized where profiteering tenants sublease apartments covered under rent control (see BLF Realty Holding Corp. v Kasher, 299 AD2d 87, 91, citing Hurst v Miske, 133 Misc 2d 362), tenant's actions here partake of apartment sharing arrangements. The restrictions against profiteering in sublet situations have traditionally not been applied to living arrangements involving roommates (see 520 East 81st Street Associates v Roughton-Hester, 157 AD2d 199, 203). Indeed, until enactment of section 2525.7 of the Code, it was the firm rule in this Department that "[t]here is no cause of action for rent profiteering with respect to a roommate" (Handwerker v Ensley, 261 AD2d 190, 191). In light of this history, if the charging of a disproportionate rental amount in these circumstances is to furnish the basis for an eviction, the governing regulations should affirmatively so state.
To the extent landlord relies upon BLF Holding v Kasher, supra, as authority for this proceeding, that case is both legally and factually distinguishable in that it addresses the interplay between the Loft Law and the Rent Stabilization Law, and concerned a tenant who subdivided and sublet his loft space.
Finally, even assuming that the remedy of eviction is available in this case, we would hold that tenant's conduct did not rise to the level of an incurable violation warranting forfeiture of the tenancy (cf. Continental Towers Ltd. V Freuman, 128 Misc 2d 680).
This constitutes the decision and order of the court.
[url=http://www.tenant.net/Rent_Laws/rsc/rsc2525.html]http://www.tenant.net/Rent_Laws/rsc/rsc2525.html[/b][/url]