Important Court Decision Regarding Regulatory Status

In a first of its kind decision, KMWB partners Nativ Winiarsky and Robert Moore recently secured a victory for their clients in a case challenging the deregulatory status of an apartment. The tenant charged that the apartment was improperly deregulated based largely upon improvements it alleged never occurred and alleged improper rent registrations. The deregulation happened prior to the statute of limitations. KMWB argued, based upon a decision it recently received from the New York Court of Appeals (argued by KMWB partner Nativ Winiarsky), that the court was barred from reviewing the events concerning the deregulation of the apartment since it occurred prior to the statute of limitations and the tenant failed to establish sufficient indica of fraud. The tenant argued that a tenant can always challenge regulatory status and does not need to establish fraud to have the court examine events concerning regulatory status that occurred prior to the statute of limitations.

The Court agreed with the arguments presented by KMWB and stated “a court could not examine whether a unit was lawfully deregulated beyond the applicable statute of limitations period unless the tenant adequately alleged a fraudulent scheme” and said the Court of Appeals recently “limit the legal basis for challenging the deregulation of an apartment outside of the statute of limitations to fraudulent schemes.”

Read the full decision here.

This is a great win for the real estate community. KMWB is proud to be the tip of the spear in successfully advocating for owner’s interests throughout this city.