Troy Ltd. v. Renna, 727 F.2d 287 (1984)

Citation: Troy Ltd. v. Renna, 727 F.2d 287 (1984)
Parent Document: Troy Ltd. v. Renna, 727 F.2d 287 (1984)
Jurisdiction: United States (federal)
Effective Date: 1984-01-30
Original Source: https://www.courtlistener.com/opinion/8929297/troy-ltd-v-renna/ ↗

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The Tenancy Act also governs the magnitude of rent increases that developers may charge in order to recoup condominium conversion costs. Section 10 of the Act provides that in a municipality without a rent control ordinance in effect, the owner cannot use increased costs due to conversion as a justification for the conscionability of a rent increase in a suit for nonpayment of rent.4 N.J.Stat.Ann. § 2A:28-61.31 (West Supp.1983). In municipalities with rent control ordinances in effect, the impact of the Tenancy Act is slightly different. In these communities, increased costs due to conversion cannot be used to justify a rent increase in a “fair return or hardship hearing” before a municipal rent board. Id. The Township of Springfield, New Jersey has such a rent control ordinance. That ordinance currently authorizes rent increases of six and one-half percent per year, subject to a number of adjustments. Two such adjustments authorize increases in “Rate of Return” and “hardship” hearings; 5 in these hearings, evidence of increased costs due to conversion would evidently not be permitted. Other adjustments — for example, adjustments reflecting increased property taxes — operate automatically, without hearings; these adjustments would apparently permit the passing on of certain conversion costs.6

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