ART 13493-L
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.: ART 13493-L
MARGARET JUNE TORNEY, DRO DOCKET NO.:
TA 10284/ CDR 21,609
OWNER: Benjamin Sendyk
PETITIONER
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ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On September 15, 1986, the above-named petitioner-tenant filed a
Petition for Administrative Review against an order issued on
August 14, 1986, by the Rent Administrator at 10 Columbus Circle,
New York, NY concerning the housing accommodation known as
Apartment 4RN at 1808 Second Avenue, New York, NY wherein the
Administrator dismissed the tenant's Fair Market Rent Appeal.
The Commissioner notes that this proceeding was initiated prior
to April 1, 1984. Sections 2526.1(a)(4) and 2521.1(d) of the
Rent Stabilization Code (effective May 1, 1987) governing rent
overcharge and fair market rent proceedings provide that
determination of these matters be based upon the law or code
provisions in effect on March 31, 1984. Therefore, unless
otherwise indicated, reference to Sections of the Rent
Stabilization Code (Code) contained herein are to the Code in
effect on April 30, 1987.
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 in the administrative appeal.
This proceeding was commenced on November 11, 1981 when the tenant
filed a complaint of rent overcharge with the former New York City
Conciliation and Appeals Board (CAB), based in part on the
tenant's belief that the initial rent exceeded the apartment's
fair market rent. The tenant took occupancy pursua t to a one-
year lease commencing October 12, 1981 and terminating October 31,
1982 at a monthly rent of $400.00.
In answer to the complaint, the owner stated that the rent being
charged was actually below the fair market rent; rents for similar
apartments in the same area were greater than the rent for the
subject apartment. Moreover, the owner stated that the
expenditure of thousands of dollars to renovate the apartment was
ART 13493-L
an added factor to be considered in computing the fair market
rent. Along with its answer, the owner submitted supporting
documentation, including a DC-2 form, an R-42 Landlord's Report of
Statutory Decontrol, a rent history lease rider and leases for
other apartments in the subject building.
Because the complainant's application met the statutory criteria
for a Fair Market Rent Appeal, the tenant's overcharge complaint
was converted to a Fair Market Rent Appeal. The owner requested
that "comparability" be based upon the free market rents charged
for apartments recently rented on the post-ETPA "Free Market."
In accord with Division instructions, the owner submitted the
rental history of each stabilized apartment in the subject line
since the base date. The owner also submitted paid bills for
improvements made to the subject apartment.
The tenant, who submitted newspaper advertisements for rental
apartments in the subject neighborhood, disputed the rental
histories and the alleged costs of improvements submitted by the
owner, but failed to submit probative evidence to contradict the
owner's claims.
In the order here under review, the Administrator determined the
Fair Market Rent to be $315.39. Pursuant to Code Section 20c (1)
the Administrator found that the owner was entitled to a monthly
rent increase of $170.66, 1/40th of the total cost of $6,826.49
for the improvements made. This resulted in a final Fair Market
Rent of $486.05. Since the Fair Market Rent ($486.05) as
calculated by the Administrator exceeded the Initial Legal
Regulated Rent ($400.00), the Administrator dismissed the tenant's
application.
In the appeal the tenant seeks to reverse the Administrator's
order. The tenant contends that:
1. The approved rent increase for improvements made to
the apartment was too high because the owner failed to
substantiate $3,500.00 for the bathroom installation;
the owner inflated prices, presenting costs for new
items but furnished old, used items; similar
improvements in other apartments in the building had
been less costly; an increase should not have been
permitted for a fireproof door or new windows.
2. Because the owner failed to timely respond to a
notice requesting comparables data, the fair market rent
should have been determined solely on the basis of
special guidelines; the DHCR permitted the owner to cure
its default and accepted the late submission of rental
data and comparables while ignoring the comparables
submitted by the tenant.
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3. The DHCR did not provide the tenant an ample
opportunity to challenge the owner's documentation on
rentals.
In response to the petition, the owner notes that the tenant
failed to document any challenge to the owner's claimed
improvements, and also notes that the proceeding was reopened by
the rent administrator for additional submissions.
The Commissioner is of the opinion that this petition should be
denied.
Section 20c (1) of the former Code provides in pertinent part for
a rent increase of 1/40th the total cost of added improvements.
In the instant case, the owner submitted invoices and cancelled
checks to document all improvements. The Administrator determined
that certain of the improvements met the statutory requirements
imposed by Section 20c (1) and approved $6,826.49 for 20c (1)
improvements but disallowed submitted costs for an entrance door,
windows and water pipes as these items constituted either repair
or normal maintenance. In substantiation of the $3,500.00
bathroom installation cost which is challenged by the tenant, the
owner submitted an invoice from the plumbing contractor and two
checks, one in the amount of $1,000.00 and the other in the amount
of $2,500.00, a total of $3,500.00. The tenant has submitted no
documentary evidence to substantiate her allegations regarding the
approved Section 20c (1) improvements.
The Emergency Tenant Protection Act, as amended by Chapter 403 of
the Laws of 1983, directs that an apartment's fair market rent be
determined on the basis of two criteria: 1) A special guidelines
order to be promulgated by the New York City Rent Guidelines Board
solely for use in determining Fair Market Rent; and 2) rents
generally prevailing in the same area for substantially similar
housing accommodations, commonly known as the comparability test.
The results of each of these two criteria are averaged to
determine the fair market rent. If no usable comparability data
is available, the special guidelines alone will be used.
In the instant case, to satisfy the first criterion, the recorded
1972 Maximum Base Rent (MBR) was converted to a 1980 MBR and then
augmented by the special guidelines. With regard to the alleged
default of the owner in responding to the fair market rent appeal,
the Commissioner notes that this time limit is not jurisdictional.
While the appeal was pending, the law was changed, permitting
owners to request that comparability be determined on the basis of
market rents charged after July 1, 1974. To use post-July 1, 1974
rentals for the comparability study, the owner was required to
submit a rental history for each stabilized apartment in the
ART 13493-L
subject line from the time that each became subject to rent
stabilization along with proof of service of either an Initial
Legal Regulated Rent Notice or the Apartment Registration form for
each apartment. The owner complied by submitting the required
data. The newspaper ads submitted by the tenant do not meet the
standard required and are not usable in the comparability study.
The tenant's contentions relating to the rental histories of the
apartments in the subject line are speculative and
unsubstantiated. Accordingly, the Commissioner finds that the
Administrator justifiably relied on the data submitted by the
owner.
The owner's comparability data was forwarded to the tenant on
November 1, 1985 with a form cover letter which permitted ten days
for a reply. The Commissioner notes that despite the tenant's
allegation that the time to reply was foreshortened, the tenant
did reply. Moreover, if more than ten days had been required the
tenant was not prevented from requesting an extension.
Based on the evidence of record, the Commissioner finds that the
owner submitted the requested documentation which was required to
compute the fair market rent and based thereon, the Administrator
properly determined the fair market rent.
The time limits cited by the Administrator to process information
are discretionary. The Commissioner finds no abuse of discretion
on the part of the Administrator in accepting the submission of
documents by the owner after the passing of particular time
limits, particularly, since the Administrator was constrained to
inform the owner of the new comparability rule.
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:
ELLIOT SANDER
Deputy Commissioner
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