AK 110651 RO
STATE OF NEW YORK
DIVISION OF HOUSING AND COMMUNITY RENEWAL
OFFICE OF RENT ADMINISTRATION
GERTZ PLAZA
92-31 UNION HALL STREET
JAMAICA, NEW YORK 11433
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IN THE MATTER OF THE ADMINISTRATIVE ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO.: AK 110651 RO
HERITAGE HOUSE,
DRO DOCKET NO.: Q 3120454 R
TENANT: LARRY KENIGSBERG
PETITIONER
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ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On February 21, 1992, an Order was issued granting the tenant's
request for reconsideration of an Order issued by the
Commissioner on January 10, 1992 concerning the housing
accommodation known as 143-30 38th Avenue, Apartment 7D,
Flushing, New York wherein the Commissioner granted in part the
owner's petition for administrative review.
The Commissioner has reviewed all of the evidence in the record
as reconstructed and has carefully considered that portion of the
record relevant to the issues raised by the administrative
appeal.
On November 20, 1986, the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
October 27, 1986 by the Rent Administrator, 10 Columbus Circle,
New York, New York concerning the above-referenced housing
accommodation wherein the Administrator determined that an
overcharge had occurred.
On August 12, 1987, the Commissioner issued an Order and Opinion
denying the petitioner's administrative appeal.
Subsequent thereto the petitioner filed a petition in the Supreme
Court, Queens County pursuant to Article 78 of the Civil Practice
Law and Rules requesting that the order of the Commissioner be
annulled.
On May 6, 1991, an order was signed by Justice Lerner remitting
the proceeding to the Division for further consideration,
specifically directing the Division to reconstruct the
administrative record (lost during the Court proceeding) and to
determine the matter on the basis of the decision in JRD
Management Inc. v. Eimicke, 148 A.D. 2d 610.
The tenant originally commenced this proceeding by filing a rent
overcharge complaint on March 31, 1984.
AK 110651 RO
In its answer, the owner set forth the rental history of the
subject apartment from December 1979 through April 1987
although there is no evidence that it submitted any leases or
other documentation in support thereof.
Based upon the owner's failure to submit a full rental history
of the subject apartment, the Administrator applied approved
default procedures to establish the lawful stabilization rent at
$311.00 as of March 24, 1984 and directed the owner to roll back
the rent and to refund an overcharge of $2,533.68 inclusive of
excess security and treble damages on the overcharge collected
on and after April 1, 1984.
On appeal, the owner alleged inter alia that it did submit a
complete rental history, that treble damages should not have been
imposed and as the tenant had failed to file an objection to the
1984 registration, the rent charged on April 1, 1984 was the
lawful rent.
The Commissioner's Order and Opinion of August 12, 1987, denying
the owner's administrative appeal, found that the record did not
substantiate the owner's assertion that it had submitted a rental
history but found instead that the record as well as the owner's
failure to submit proof of its assertion with the appeal
sustained the Administrator's finding that the owner had
defaulted.
With respect to the remaining issue raised in the appeal, the
Commissioner found that the assessment of treble damages was
appropriate. The owner had been notified in a "Final Notice of
Pending Default" of the consequences, including the methods to be
used in establishing the rent and the imposition of treble
damages on overcharges which the owner had failed to show were
not willful, attendant on the owner's failure to provide the
required rental history.
The Commissioner also determined that the owner's contention with
regard to the lawfulness of the April 1, 1984 rent was incorrect.
Since the tenant's overcharge complaint was pending before the
Administrator, the tenant was not required to file a second
complaint involving the same issue.
In the order issued on January 10, 1992, accepting the
unsubstantiated rental history submitted by the owner and
pursuant to the Court's directive, the Commissioner granted the
owner's petition in part and modified the Administrator's order,
establishing the lawful rent at $373.36 and directing a refund of
$210.15 including excess security and treble damages.
By letter dated January 27, 1992, the tenant requested re-opening
of the Administrative proceeding and reconsideration of the
January 10, 1992 order.
Based upon an irregularity in a vital matter-the absence from
the record of supporting documentation for the rent history as
set forth by the owner, the tenant's request for reconsideration
was granted.
In response, the owner submitted a lease dated February 3, 1982
AK 110651 RO
which, it asserted, proved that there was no overcharge. The
owner stated that it had no leases for the subject apartment
prior to February 3, 1982 and asserted in substance that since
the tenant had failed to object to the initial registered rent,
the rent registered on April 1, 1984 was the legal rent and any
alleged overcharge prior to April 1, 1984 was inapplicable.
In reply, the tenant contends that utilization of the default
procedure to determine the legal rent is appropriate because the
owner failed to produce all leases from April 1, 1980 to March
1984.
The Commissioner is of the opinion that the Petition for
Administrative Review should be denied.
Section 26-516 of the Rent Stabilization Law, effective April 1,
1984, limited an owner's obligation to provide rent records by
providing that an owner may not be required to maintain or
produce rent records for more than four years prior to the most
recent registration. Pursuant to Section 26-516, the instant
owner was required to produce rent records from April 1, 1980.
A review of the record reveals that the owner failed to satisfy
its legal obligation and submitted no leases for the subject
apartment for any period prior to February 3, 1982. Accordingly,
the Commissioner finds that the Administrator did not err in
defaulting the owner and utilizing default procedures approved by
the courts to determine the lawful stabilization rent.
Section 26-516 further provides for a penalty of treble damages
when an owner is found to have collected a willful overcharge
unless the owner shall establish by a preponderance of the
evidence that the overcharge was not willful. The owner herein
was fully apprised that treble damages would be imposed on any
rent overcharge collected on or after April 1, 1984 should it
fail to establish non-willfulness. Accordingly, the
Administrator did not err in imposing treble damages since the
owner submitted no evidence to show that the overcharge was not
willful.
The Commissioner is further of the opinion that the owner's
contention with respect to the legality of the rent charged on
April 1, 1984 is incorrect. The tenant's complaint was filed in
March 1984 before the effective date of the Rent Stabilization
Law whose registration provisions were not designed to cut off
the rights of tenants who had filed complaints prior to April 1,
1984. The owner was required to register the legal rent, whose
determination required resolution of the tenant's pending
challenge to the rent charged. The tenant was under no
obligation to file a second complaint involving the same issue.
Accordingly, the Commissioner finds that the Administrator did
not err in establishing the lawful stabilization rent at $311.00
as of March 24, 1984 through March 31, 1985 and in directing the
owner to refund $2,533.68 inclusive of excess security and treble
damages on the overcharge collected on and after April 1, 1984.
Because this determination concerns lawful rents only through
March 31, 1985, the owner is cautioned to adjust subsequent rents
AK 110651 RO
to an amount no greater than that determinated by this order plus
any lawful increases, and to register any adjusted rents with
this order and opinion being given as the explanation for the
adjustment.
Since the record reveals that the tenant has vacated the subject
apartment, a copy of this order is being sent to the current
tenant.
This order 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 in the same
manner as a judgment.
THEREFORE, in accordance with the Rent Stabilization Law and
Code, it is
ORDERED, that this petition be, and the same hereby is, denied
and the Rent Administrator's order be, and the same hereby is,
affirmed.
ISSUED:
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JOSEPH A. D'AGOSTA
Acting Deputy Commissioner
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