BE610484RO

                                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

      ------------------------------------X 
      IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
      APPEAL OF                              DOCKET NO. BE610484RO            
              
                                          :  DISTRICT RENT OFFICE
                                             DOCKET NO. TC043518G
                                                        CDR 30226             
           Hafiz M. Ellahi,                 
                                             OWNER: New Dawn University, L.P.

                                             FORMER OWNER: 2240 University
                                                           Avenue Corp.

                                             TENANT: Diane (Greene) Foster   
                            PETITIONER    : 
      ------------------------------------X                             

           ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW


      On May 29, 1987 the above-named petitioner filed a Petition for 
      Administrative Review against an order issued on May 1, 1987 by the 
      District Rent Administrator, 10 Columbus Circle, New York, New York 
      concerning housing accommodations known as 2240 University Avenue, 
      Bronx, New York, Apartment No. 4E wherein the District Rent 
      Administrator determined that the (former) owner had overcharged the 
      tenant.
           
      The Commissioner notes that this proceeding was filed 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 issue herein is whether the Rent Administrator's order was 
      warranted.

      The applicable sections of the Law and Section 26-516 of the Rent 
      Stabilization Law and Section 2526.1(a) of the current Rent 
      Stabilization Code.

      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 in May, 1980 of 
      a rent overcharge complaint by the tenant, in which she stated that she 







          BE610484RO

      had commenced occupancy on April 12, 1978 at a rent of $250.00 per 
      month.  The tenant named the owner as 2240 University Avenue Corp., 
      stated that she paid her rent to Newman Mgmt. Corp., and enclosed an 
      April 12, 1978 lease with Omniventures, Inc.  2240 University Avenue 
      Corp. and Newman Mgmt. Corp. were sent copies of the complaint.  In 
      1986, 2240 University Avenue Corp. and other prior or subsequent owners 
      were sent Final Notices of Pending Default.  All of the notices were 
      returned by the Postal Service.  (A March 24, 1981 " Report of Change In 
      Identity of Landlord" sent to the Office of Rent Control indicated that 
      2240 University Avenue Corp. was in receivership as of that date.)

      In Order Number CDR30226, based on the failure to submit a rental 
      history, the rent for the subject apartment was established at $187.20 
      effective April 15, 1978 and an overcharge of $1570.00 was determined 
      covering the period from April 15, 1978 to April 14, 1980.  The owner 
      was listed as 2240 University Avenue Corp.

      In this petition, Hafiz M. Ellahi contends in substance that he never 
      received a copy of the order, although the tenant informed him of the 
      order; that he was not the owner in 1978, but bought the building in 
      January, 1985; and that the complainant was the first stabilized tenant, 
      which entitled the charging of a fair market rent.

      In answer, the tenant asserts in substance that Mr. Hafiz Ellahi sold 
      the building in 1987; that the new owner refunded the overcharge from 
      1978 to 1984, but refused to do so for the overcharge from 1985 to 1988; 
      and that "[t]he document I received from DHCR, Doc. #TC043518C was 
      sealed 1/14/88.  Why is this petition being accepted."  [It is not clear 
      what the tenant means by this last statement.  While Mr. Hafiz Ellahi 
      sent a copy of his petition in response to an April 14, 1988 DHCR 
      request for a copy of the order being appealed, the file contains the 
      original of his petition, which was received on May 29, 1987.]

      All mailings to Mr. Hafiz Ellahi since 1990 have been returned by the 
      Postal Service.

      In a recent enclosure of a submission made in 1990 in another overcharge 
      proceeding, the current owner New Dawn University, L.P. contends in 
      substance that it purchased the subject premises in July, 1987; that it 
      subsequently settled any claim of the complainant from April, 1984 to 
      date; that it executed a renewal lease effective January 1, 1987 at a 9% 
      increase over the $187.20 rent set by the Administrator for the tenant's 
      1978-80 lease; and that there has been no overcharge since it bought the 
      building.  With its submission the current owner has submitted a copy of 
      a January 23, 1988 settlement wherein it dropped claims for back rent 
      and agreed to pay the tenant installments of $1,570.00 and $842.80 in 
      full settlement of any rent claims prior to March 31, 1988.  The tenant 
      also agreed that the legal rent was $204.05, and that "if the check for 
      $1,570 coming from Hafiz's lawyer is made payable to tenant, that tenant 
      will endorse it over to landlord."

      The Commissioner is of the opinion that this petition should be denied.


      The only issue in this appeal proceeding is whether the Administrator's 
      order was correct in its setting of a rent and finding of an overcharge 
      for the 1978-80 lease term.  New Dawn University L.P.'s submission does 
      not address that issue, Hafiz Ellahi did not submit a rental history or 


          BE610484RO

      evidence of date of decontrol, and DHCR records do not contain anything 
      to show that the complainant was the first stabilized tenant, so there 
      is no basis to change the Administrator's order.  To the extent that 
      Hafiz Ellahi might be contending that he should not be liable for 
      overcharges occurring prior to the time he bought the building, his 
      contention is irrelevant, since the order does not name him as being 
      liable for the $1,570.00.  

      Further the Commissioner notes that for overcharge complaint filed prior 
      to April 1, 1984, absent collusion or any relationship between owners, 
      overcharges collected prior to April 1, 1984 are solely the 
      responsibility of the owner collecting them.  Pursuant to Section 
      2526.1(f) of the current Rent Stabilization Code, a current owner is 
      responsible for all overcharges collected on and after April 1, 1984.  
      Since Hafiz Ellahi bought the building in 1985, and there is no evidence 
      of collusion, he is not liable for the overcharge determined by the Rent 
      Administrator which dealt with the period from 1978 - 1980.
        
      THEREFORE, in accordance with the Rent Stabilization Law and Code, 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, 
      affirmed.


      ISSUED:



                                                                    
                                      JOSEPH A. D'AGOSTA
                                      Deputy Commissioner







    

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