ADM. REVIEW DOCKET NO.: BC 110280-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.: BC 110280-RO
: D.R.O. DOCKET NO.:
QS 000919-OM
Prior Owner: C.D.I.
Development, Inc.
BRUCE R. FOX,
Tenants: Various
PETITIONER :
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ORDER AND OPINION REMANDING PROCEEDING TO RENT ADMINISTRATOR
On March 20, 1987, the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
February 13, 1987, by the Rent Administrator, 92-31 Union Hall
Street, Jamaica, New York, concerning housing accommodations
known as various apartments, 216-07 and 216-09 Hillside Avenue,
Queens Village, New York, wherein the Rent Administrator denied
the application for a rent increase on a Major Capital
Improvement (MCI) without prejudice to the right of the new owner
to file a rent application that is properly substantiated.
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 appeal.
The prior owner commenced this proceeding on October 1, 1985
by filing an application for an MCI increase. The prior owner
did not identify itself as either the current managing agent or
the prior owner.
In answer to the application, one tenant stated that the
work was done by the prior owner, not the current owner,
petitioner herein.
In Order Number ZQS 000919-OM, the Rent Administrator
determined that the prior owner had sold the building to the
petitioner on August 19, 1985 and that the October 1, 1985
application by the prior owner was therefore defective. The
Administrator also stated that certain specified improvements did
not qualify as an MCI, being ordinary repairs or work done in
conjunction with the subdivision of the subdivision of the
complex. Other specified improvements were stated to be
improperly substantiated by supporting documentation. However,
the specific deficiencies were not stated in the order.
ADM. REVIEW DOCKET NO.: BC 110280-RO
The Administrator further stated:
"Accordingly, the application is denied without
prejudice to the new owner filing a new application,
that is properly substantiated. Any new application
filed for those items which might qualify as Major
Capital Improvements, should clearly designate which
work was needed for the operation and preservation of
the building and which work was performed in
conjunction with the sub-division of the complex."
Division records indicate that the new owner did not file a
new MCI application.
In this petition, the new owner contends that the Rent
Administrator's Order is incorrect and should be modified because
the prior owner, was in fact the managing agent at the time the
application was filed, so that the filing was proper. In the
alternative, the owner argues that even if the prior owner was
not the managing agent, a new owner is permitted to file an MCI
application for work done by a prior owner.
In addition, the petitioner argues that all the improvements
had been properly substantiated and each should qualify as an
MCI.
No further proof of any improvement is submitted nor does
the owner submit any proof that the prior owner was the managing
agent when it filed the application.
In answer to this petition, one tenant contends that the
order should be upheld because the owner has failed to repair
certain damage done to the tenant's apartment as a result of some
of the various installations that are the subject of this
proceeding. In addition, the tenant alleges certain service
violations. A second tenant alleges that certain of the
improvements (new walks, new boiler) were necessitated solely for
the purpose of subdivision.
The Commissioner is of the opinion that this proceeding
should be remanded to the Rent Administrator.
The petitioner is correct that a managing agent, or any
other agent, can apply for an MCI increase on behalf of an owner.
The owner is also correct that a current owner can apply for an
MCI increase for work done by a prior owner. Accordingly, the
Commissioner hereby finds that the Administrator should have
substituted the new owner for the old owner on the application
and treated the so-reformed application as filed as of the date
of the actual application. On remand, the application should be
processed on its merits as if filed by the new owner, petitioner
herein.
The substantive allegations of the owner regarding the
sufficiency of proof are to be resolved on remand.
Parenthetically, the Commissioner notes that the checks submitted
by the owner do not add up to the alleged total expenditures for
certain improvements and for at least one improvement there is no
ADM. REVIEW DOCKET NO.: BC 110280-RO
proof as to how much of the total cost of the improvement for the
complex should be allocated to the building which is the subject
of this appeal. In short, the record as it stands is clearly
deficient.
Finally, the Commissioner notes that for an improvement to
qualify for an MCI increase it must be "for the operation,
preservation, and maintenance of the structure."
This Order is without prejudice to the rights of the tenants
to file service complaints, if the facts so warrant.
THEREFORE, in accordance with the provisions of the Rent
Stabilization Law and Code, it is
ORDERED, that this petition for administrative review be,
and the same hereby is, granted, to the extent of remanding this
proceeding to the Rent Administrator for further processing in
accordance with this order and opinion.
ISSUED:
ELLIOT SANDER
Deputy Commissioner
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