Another Way to Avoid Treble Damages in Housing Court
September 23, 2018
Speaking of treble damages on a Rent Stabilization overcharge claim (my last blog post was on a similar topic), this is an interesting story.
I took a nonpayment case over, on behalf of landlord, from one of the usual suspects in Housing Court. This is what I have referred to in these pages before as a “clean up the mess” case. A previous lawyer (not from my firm) had put the case into suit, alleging that the tenant was deregulated – which was utter nonsense. Anyone should have been able to look at the case and known that this was an illegal deregulation. And, indeed, Legal Aid did just that. So by the time I was substituted in, it was on the eve of trial and there was not a drop of good will to be found between the litigants and the judge was none too happy either. I immediately conceded that landlord’s case was dog poop and discontinued it. I was there to defend against damages on the obvious overcharge. How fun.
But there were a few bright spots. First, although the apartment was not deregulated, the rent level was defensible based upon actually well preserved evidence of Individual Apartment Improvements. In fact, the contractor who did the work agreed to testify and he turned out to be an excellent witness, best contractor witness I think I have ever encountered. Second, the tenant had not paid rent in so long that it would offset at least some of the overcharge. Third, I made my husband and law partner try the case for me!
The result was pleasantly surprising. The judge, of course, found fraud and knocked the rent level back to the last registered rent. Yet because we were able to credibly establish that the work alleged by landlord to have been done was actually done, the judge did not find willfulness and did not award treble damages on the overcharge.
What’s the lesson?
The lesson to landlords and their lawyers remains the same. No case should ever be initiated in Housing Court against a “free market” tenant unless and until you analyze the deregulation and are satisfied you can defend it. Half the time, you can’t. Moreover, if in the course of a litigation proceeding, you discover that you have an indefensible position, abandon the position. I have done more good for more clients by honestly conceding than I ever did by doubling down on something stupid.
Respectfully submitted,
