In Rashid v. Cancel, 9 Misc.3d 130[A], 808 N.Y.S.2d 920, 2005 NY Slip Op 51585[U], 2005 WL 2441996 (App. Term, 2005), the landlord's building once contained six units (five legal units and one illegal basement apartment).
The basement apartment was vacated after the landlord was cited by the Department of Housing Preservation and Development for the apartment.
The landlord argued that the reduction from six to five units in the building rendered the building exempt from rent stabilization coverage.
However, the Court held that "the use of the basement as a sixth housing accommodation over a multi-year period brought the entire building under rent stabilization."
The Court further held that "the alleged subsequent reduction in the number of housing accommodations to fewer than six, even if done, as landlord claims, after the placement by the Department of Housing Preservation and Development of a violation, did not exempt the remaining units from rent stabilization." Id.