month with "Legal - $2728.52" written on the bottom. Upon expiration of that lease, the present
proceeding ensued.
As mentioned above, the parties agree that the apartment at issue was subject to rent
stabilization before 1999. That year, the apartment was registered as temporarily exempt based
on its use by petitioner's employee. Under RSC § 2520.11 (m), said use of the premises
rendered the premises temporarily exempt from rent stabilization "so long as" the premises were
used for that purpose. Upon the expiration of the exempt use, the premises return to rent
regulation as the exemption is only temporary in nature (see RSC § 2520.11 [m];
RSC § 2526.1 [a][3][iii]; Blumenthal v Chung Fu Lam, 17 Misc 3d 233[Civ Ct, NY County
2007]). However, according to petitioner's records, the subject apartment never returned to rent
stabilization.
Petitioner's argument for removing the apartment from rent stabilization is essentially
twofold. First, it argues that, under RSC § 2526.1 (a)(3)(iii), it can set the rent at whatever
the market will bear. Second, petitioner argues that even if it wrongfully removed the premises
from the ambit of rent stabilization when it rented it out to Crump in April 2001, it is too late to
challenge it. These arguments are without merit.
Petitioner's first argument is premised on its claim that the RSC allows petitioner to set the
rent at whatever the market bears even if it means deregulating the apartment. Petitioner relies on
RSC § 2526.1 (a)(3)(iii) in support. That provision of the code, which falls within a section
that addresses calculating the legal rent for rent overcharge claims, states that:
"Where a housing accommodation is vacant or temporarily exempt from regulation