ADM. REVIEW DOCKET NOS.: AJ 110383 RO & AJ 110369 RT

                                  STATE OF NEW YORK
                            OFFICE OF RENT ADMINISTRATION
                                     GERTZ PLAZA
                               92-31 UNION HALL STREET
                               JAMAICA, NEW YORK 11433

          APPEALS      OF                                  DOCKET      NOS.:
                                                 AJ 110383 RO 
                                              :  AJ 110369 RT
                                                 D.R.O.      DOCKET      NO.
                                                 Q 3122300 R
          ORIN         MANAGEMENT         CORP.,         OWNER,          AND
          H. & R. SAUERS, TENANTS,   

                                 PETITIONERS  :  


               The above-named petitioner-owner and petitioner-tenants filed 
          timely Petitions for Administrative Review against an order issued 
          on September 18, 1986, by  the  District  Rent  Administrator,  10
          Columbus  Circle,  New  York,   New   York,   concerning   housing
          accommodations  known  as  Apartment  11B,  137-57  75th   Avenue,
          Flushing, New York, wherein the Rent Administrator determined that 
          the tenants had been overcharged. 

               The Commissioner has reviewed all  of  the  evidence  in  the
          record and has carefully considered that  portion  of  the  record
          relevant to the issues raised by the administrative appeals.    

               The tenants commenced this proceeding on March  27,  1984  by
          filing an overcharge complaint with the New York City Conciliation 
          and Appeals Board, one of the predecessor agencies  to  the  DHCR.
          The  tenants  took  occupancy  pursuant  to  a  lease   commencing
          December 1, 1974 and expiring  November  30,  1976  at  a  monthly
          rental of $225.00.

               The owner was served with a copy of  the  tenants'  complaint
          and was requested to submit rent records to prove  the  lawfulness
          of the rent being charged.  The owner submitted a  rental  history
          and leases for the period from September 1, 1969 through  November
          30, 1984.

               In Order  Number  22,541,  the  District  Rent  Administrator
          established  the  lawful  stabilized  rent,  determined  that  the
          tenants had been overcharged, and directed  the  owner  to  refund
          overcharges of $3100.49 including interest, to the tenants.

               In its petition, the owner contends  that  the  prior  tenant
          received a special reduced rent, and that the complaining tenants' 

          ADM. REVIEW DOCKET NOS.: AJ 110383 RO & AJ 110369 RT
          rent included an "agreed and understood increase"  of  $22.62  for
          the installation of a washing machine and an air conditioner.

               The tenants, by their attorney, responded  that  the  owner's
          petition was not executed, and was therefore defective.     

               In their petition, the tenants  allege  that  treble  damages
          should have been awarded.   

               The owner did not respond to the tenants' petition.

               The Commissioner is  of  the  opinion  that  these  petitions
          should be denied.

               In Matter of Collingwood  Enterprise  v.  Gribetz,  N.Y.L.J.,
          April 24, 1975, p. 17, col. 6 (Sup. Ct. N.Y. Co., Fine, J), it was 
          found that "nothing...prohibits an owner from charging  less  than
          the maximum  rent;  and...where  an  owner  failed  to  charge  an
          allowable guideline  increase  prior  to  the  expiration  of  the
          guideline period, the lawful rent upon which  the  rent  guideline
          is  computed  may  not  be  increased  to  reflect  such  previous
          guideline allowance".  An owner is required  to  compute  the  new
          rent above the rent actually charged and paid  on  the  applicable
          base  rent  date.   In  this  case,   the   owner   submitted   no
          documentation to support its assertion that the prior  tenant  had
          received a special reduced rent,  which  would  warrant  departing
          from the Collingwood principle.  Therefore  this  portion  of  the
          owner's petition is denied.   

               Section 2529.6 of the  Rent  Stabilization  Code  limits  the
          scope of review "to facts or evidence before a Rent  Administrator
          as raised in the  petition."   The  owner's  contention  that  the
          complainant-tenant's  rent  included  an  "agreed  and  understood
          increase of $22.62" for installation of a washing machine  and  an
          air conditioner was  not  raised  in  the  proceeding  before  the
          Administrator and  may  not  be  raised  for  the  first  time  on
          administrative appeal.  It is noted that the owner has  failed  to
          submit   any   supporting   documentation.     Accordingly,    the
          Commissioner finds that  the  Administrator  was  correct  in  its
          finding of overcharge.   

               Section 26-516 of  the  Rent  Stabilization  Law  states,  in
          pertinent part:  "Any owner who is found  by  the  have
          collected any excess of the legal regulated  rent  shall
          be ordered to pay to the tenant a penalty equal to three times the 
          amount  of  such  excess....   If  the  owner  establishes  by   a
          preponderance of the evidence that the overcharge was not willful, 
          the DHCR  shall  establish  the  penalty  as  the  amount  of  the
          overcharge plus interest...."

               Whereas the Commissioner has determined that the owner is not 
          entitled to a rent increase for the air  conditioner  and  washing
          machine because of its failure to  timely  raise  the  issue,  the
          Commissioner does find that, based upon the fact that the  tenants
          have  not  denied  possession  of  these  items,  the  owner   has

          ADM. REVIEW DOCKET NOS.: AJ 110383 RO & AJ 110369 RT
          established that the overcharge was not willful, and  that  treble
          damages do not lie. 

               Regarding the tenants' assertion that  the  owner's  petition
          was not executed, the Commissioner notes that the photocopy served 
          upon the tenants was clearly marked "Copy"; and that the  Division
          has, in its possession, the fully-executed petition, which is  not
          defective in any respect.  

               This order of the State Division  of  Housing  and  Community
          Renewal awarding penalties may, upon the expiration of the  period
          in which the owner may institute a proceeding pursuant to  Article
          78 of the Civil Practice Law and Rules, be filed and enforced by a 
          tenant in the same manner as a  judgment,  or  not  in  excess  of
          twenty percent thereof per month may be offset  against  any  rent
          thereafter due the owner.

               THEREFORE, in accordance with the Rent Stabilization Law  and
          Code, it is

               ORDERED, that these petitions be  and  the  same  hereby  are
          denied and the District Rent  Administrator's  order  be  and  the
          same hereby is affirmed.  


                                          ELLIOT SANDER
                                          Deputy Commissioner


          ADM. REVIEW DOCKET NOS.: AJ 110383 RO & AJ 110369 RT


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