STATE OF NEW YORK
DIVISION OF HOUSING AND COMMUNITY RENEWAL
OFFICE OF RENT ADMINISTRATION
92-31 UNION HALL STREET
JAMAICA, NEW YORK 11433
IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO.: ARL 13382-N
MAPLEWOOD MANAGEMENT, INC., DRO DOCKET NO.: HEMPTA 83-118
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On September 3, 1986 the above-named petitioner-landlord filed a Petition
for Administrator Review against an order issued on August 20, 1986, by
the district Rent Administrator, 50 Clinton Street, Hempstead, New York,
concerning housing accommodations known as Apartment No. 2L at 380 Front
Street, Hempstead, New York, wherein the District Rent Administrator
determined that the tenant had been overcharged.
The issue in this appeal is whether the District Rent Administrator's
order was warranted.
The Commissioner has reviewed all of the evidence in the record and has
carefully considered that portion of the record relevant to the issue
raised by the administrative appeal.
This proceeding was originally commenced by the filing of an application
by the tenant (Rebecca Jenkins) for adjustment of the initial legal
regulated rent ("fair market rent appeal"). The tenant took occupancy
pursuant to a lease commencing November 1,1981 and expiring October 31,
1983 at a monthly rent of $425.00.
The landlord was served with a copy of the complaint and was requested to
submit the prior tenant's lease.
In answer, the owner asserted, among other things, that it maintained no
leases prior to the complainant's.
In an order issued on August 20, 1986, the District Rent Administrator
determined the fair market rent of the subject apartment by comparing the
tenant's initial rent to the rent established for a comparable apartment
in the building (apt 4L) in another case (HEMPTA 83-262). Since the rent
established for the comparable apartment exceeded the tenant's initial
rent, the tenant's initial rent was accepted as the initial legal
The Administrator further determined that the tenant was overcharged on
her renewal lease commencing November 1, 1983 in the amount of $329.52 and
directed the landlord to refund such amount to the tenant as well as to
reduce the rent.
DOCKET NUMBER: ARL 13382-N
In this petition, the landlord contends in substance that the
Administrator's order is barred by the Civil Practice Law and Rules Sec.
214(2); that the order violates State Administrative Procedure Act Sec.
307(2) because of being based not on evidence in the papers served on the
parties but on evidence which was obtained from the tenant or others
without notice or an opportunity to be heard; that the order should be
barred by laches because many rights have arisen in the more than three
years between the filing of the complaint and the Administrator's
determination; that the formula used to adjust the initial legal regulated
rent as being in excess of the fair market value (lowest adjusted rent in
the same line) constitutes a regulation required to be filed (but which
was not filed) under the State Administrative Procedure Act Sec. 203; that
the tenant's application did not present facts which to the best of the
tenant's information and belief supported the same, as required by Tenant
Protection Regulations Sec. 2502.3(a); and that the initial legal
regulated rent as adjusted failed to include an allowance for a vacancy
factor or guideline adjustment as in Docket Number HEMPTA 83-318.
The tenant did not submit an answer to this petition.
The Commissioner is of the opinion that this petition should be denied.
Civil Practice Law and Rules (CPLR) Section 101 provides that "[t]he civil
practice law and rules shall govern the procedure in all judicial
proceedings in all courts of the state and before all judges..." [emphasis
added]. Because this is an administrative rather than a judicial
proceeding, the CPLR is not applicable.
Section 307(2) of the State Administrative Procedure Act provides in
substance that agency personnel assigned to render a decision or to make
findings of fact and conclusions of law shall not communicate directly or
indirectly with any person or party in connection with any issue of fact,
nor with any party or their representative in connection with any issue of
law, except upon notice and opportunity for all parties to participate;
and that such agency personnel may communicate with other members of the
agency, and may have the aid and advice of agency staff other than staff
who are or have been engaged in the investigative or prosecuting functions
in connection with the case under consideration or a factually related
case. The evidence whose use the landlord objects to appears to be the
rent for Apartments 4L as established in HEMPTA 83-262. Because the
landlord was afforded an opportunity to submit the prior lease for the
subject apartment but failed to do so, and because the rent for Apartment
4L was obtained from an earlier proceeding, the landlord is not
persuasive in claiming that the information was obtained ex parte or that
it did not have notice or an opportunity to be heard regarding this
evidence. It is noted, use of this information did not result in an
adjustment of the tenant's initial rent, but rather resulted in a
determinationon that the tenant's initial rent was lawful.
Concerning the landlord's contention that the Administrator's order should
be barred by laches because it was issued more than 3 years after the
tenant's complaint and many rights have arisen since the complaint was
filed: laches is used as an equitable defense, based generally on the
claimed neglect of a party to assert a right or claim which, taken
together with a lapse of time and other circumstances, has caused
prejudice to an adverse party. The tenant cannot be said to have been
DOCKET NUMBER: ARL 13382-N
guilty of laches, having filed a fair market rent appeal shortly after his
apartment became subject to the Emergency Tenant Protection Act of 1974.
The DHCR is not guilty of laches because it is not a party that has failed
to assert a right, but is rather the adjudicator of rights which the
tenant has asserted in a timely fashion. In any event, the landlord was
aware since April 1983 that there was a proceeding pending, involving a
claim that the rent charged was in excess of the fair market rent. The
Administrator's order of August 20, 1986 merely resulted in rolling back
the rent for the tenant's renewal lease to what the landlord should have
been charging, and directing a refund (without interest) of amounts that
the owner had actually collected in excess of the legal regulated rent.
This would seem to be a minimal amount of "harm" resulting from any delay
in administrative determination since the current rent, as well as the
total amount of rent collected (after refunding excess rent pursuant to
the Administrator's order), is the same that it would have been if the
Administrator had issued an order immediately after the tenant's fair
market rent appeal was filed. Even if the DHCR were somehow a party
susceptible to having the equitable defense of laches raised against it,
that defense would not be particularly convincing in this case.
Section 203(1) of the State Administrative Procedure Act provides in
substance that no rule shall become effective until it is filed with the
Secretary of State. Section 102(2)(a) in pertinent part defines "rule" as
"the whole or part of each agency statement, regulation or code of general
applicability that implements or applies law, or prescribes...the
procedure or practice requirements of any agency, including the amendment,
suspension or repeal thereof..." The Tenant Protection Regulations,
promulgated pursuant to the authority of the Emergency Tenant Protection
Act of 1974 (ETPA), constitute such a rule, and were properly filed.
Section 9 NYCRR 2502.3(a)(2) (formerly Section 33) of the Tenant
Protection Regulations provides in substance that the determination of the
"fair market rent" shall be guided by the fair market tent guidelines
promulgated by the Rent Guidelines Board Section 4 of the ETPA establishes
county rent guidelines boards, each of which "shall establish annually
guidelines for rent adjustments which, at its sole discretion may be
varied and different for and within the several zones and jurisdictions
of the board...[a]s soon as practicable after its creation and thereafter
not later than July first of each year, a rent guidelines board shall file
with the State Division of Housing and Community Renewal its findings for
the preceding calendar year, and shall accompany such findings with a
statement of maximum rate or rates of rent adjustment, if any, for one or
more classes of accommodation subject to this act, authorized for leases
or other rental agreements commencing during the next succeeding twelve
Nassau County Rent Guidelines Board Guideline No. 17 was the first
guideline promulgated for housing accommodations in the Village of
Hempstead after that municipality became subject to the ETPA and the
Tenant Protection Regulations. Guideline 17 establishes the guidelines
to be used by the DHCR for the determination of fair market rent appeals.
Because the landlord had not furnished any evidence of the prior rent of
the subject apartment, the Administrator compared the tenant's initial
rent with the rent of a comparable apartment in the building as
established in a prior Administrator's order and based thereon found the
tenant's initial rent to be lawful. While the provisions in the ETPA and
the Tenant Protection Regulations that DHCR be guided by the fair market
DOCKET NUMBER: ARL 13382-N
rent guidelines of the County Rent Guidelines Board constitute "rules"
that are required to be (and are) filed with the Secretary of
State, the guidelines themselves are not "rules" (although they are
formulated through public input and public hearings, are filed with the
DHCR, and are available to the public), nor are DHCR policies used to
apply them, including the policy of using the rent of a comparable
apartment where a landlord has failed to provide a requested prior lease.
Regarding the landlord's contention that Section 2502.3(a) of the Tenant
Protection Regulations required the tenant to present facts which to the
best of his information and belief support an allegation that the rent
charged was in excess of the fair market rent, the Commissioner notes that
the filing of a fair market rent appeal by the tenant is simply one way of
beginning a proceeding before the DHCR, and of informing a landlord that
it has to justify the lawfulness of the rent being charged. Because a
landlord is obligated to charge only lawful rents, it has the burden of
providing their lawfulness when called upon to do so either by a tenant's
complaint or by a proceeding instituted by the DHCR pursuant to Section
2507.2 (formerly Section 82) of the Tenant Protection Regulations. While
the tenant's provision of factual information may prove useful to the DHCR
in determining a complaint, the failure to provide factual information doe
not invalidate an otherwise valid complaint, particularly since the
directive in Section 2502.3(a) is qualified by the phrase "to the best of
his information and belief," and therefore cannot be read to create a firm
Regarding the owner's contention that the initial legal regulated rent as
adjusted did not include a vacancy allowance or guideline adjustment, it
is again noted that the tenant's initial rent was not adjusted but was
determined to be lawful by comparing the tenant's initial rent with the
rent previously established for a comparable apartment. It was therefore
unnecessary to establish the initial legal regulated rent by increasing
the prior rent for a comparable apartment by a guideline and vacancy
allowance, as was done in HEMPTA 83-318, the case cited by the owner.
THEREFORE, in accordance with the Emergency Tenant Protection Act of 1974,
and the Tenant Protection Regulations, it is
ORDERED, that this petition be, and the same hereby is, denied and that
the District Rent Administrator's order be, and the same hereby is,