Docket Number: BC 520014-RO
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.: BC 520014-RO
PARK TERRACE GARDENS, INC., DISTRICT RENT ADMINISTRATOR'S
DOCKET NO.: BC 520014-RP
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On May 5, 1987, the above-named petitioner-owner filed a Petition
for Administrative Review against an order issued on April 3, 1987,
by then Director, MBR Unit at Gertz Plaza, Jamaica, New York,
concerning the housing accommodation known as 64-67 Park Terrace
West, New York, New York, wherein the Director revoked the Maximum
Base Rent (MBR) adjustments for the 1984-85 cycle permitted under
the interim order issued on September 25, 1985 under DRO Docket
The petitioner requests that the determination be reversed on the
grounds that it was denied due process, as more fully set forth
below, and asserts that the owner did remove the required percentage
of violations to qualify for eligibility for the MBR adjustments for
the subject premises.
The administrative appeal process, in connection with Maximum Base
Rent (MBR) proceedings is a two-step process. The initial step in
the MBR appeal process is a challenge which is filed and considered
by the Rent Office Unit. The Administrator's order deciding such
challenge can be appealed to the Commissioner by PAR by the party
adversely affected by the challenge determination.
The record below revealed that on November 19, 1985, the tenant
filed a challenge to the MBR order of eligibility issued on
September 25, 1985 under Docket No. 6M-2083.
On April 18, 1986, the Administrator issued a notice of proceeding
to modify or revoke the order of eligibility, on the grounds that a
review of the records in file revealed that the owner had failed to
remove the required number of violations.
On May 12, 1986, the owner's new managing agent, advising that it
had just received a copy of the April 18, 1986 from the prior
managing agent, requested an extension of time to answer the notice,
as well as to obtain copies of the records used to support the
claim, since the documents had not been made available by the prior
managing agent. A further extension was granted pursuant to a sub
sequent request by the new managing agent, by their attorneys,
dated July 10, 1986. On September 25, 1986, the Administrator
issued an order under Docket No. UC-0036-BC, addressed to the prior
managing agent, revoking the September 25, 1986 order under Docket
No. 6M 2083, on the grounds that the owner had failed to submit the
Docket Number: BC 520014-RO
prescribed violation certification request for the 1984-85 MBR
increases. A subsequent order was issued October 1, 1986 to the
same effect, to the new managing agent, care of their attorneys,
correcting and superseding the September 25, 1986 order.
On November 5, 1986, the petitioner filed an administrative appeal
arguing that the Administrator's notice, reopening the prior
proceeding, mailed to the prior rather than the current agent,
failed to make the record available for inspection and deprived the
owner of the opportunity to present a defense. On February 27, 1987
the Commissioner, under PAR Docket No. AJ-520576-RO, granted the
owner's petition to the extent of remanding the proceedings to the
Administrator to afford the owner an opportunity to submit a
On March 12, 1987, the Administrator, under DRO Docket No.
BC-520014-RP, notified the parties pursuant to the Commissioner's
remand order, to make an appointment to review the records and to
submit written evidence to support any claim, within 10 days of the
date of the notice. The record shows that the owner's attorneys
reviewed the record on March 19, 1987.
On April 3, 1987, the Administrator issued the order, herein under
appeal, affirming the October 1, 1986 ord r under Docket No. UC-
0036-BC, which revoked the interim order finding the owner eligible
for interim MBR increases for the 1984-85 cycle, for failure to meet
the violation certification requirements necessary to qualify for
permanent MBR increases.
The petitioner challenges the Administrator's determination arguing
that the owner was deprived of a meaningful opportunity to answer,
in that only fifteen days had expired from the date the owner's
attorney had inspected the document in file so that an answer could
be submitted. The petitioner also contends that the Division
normally allows parties twenty (20) days in which to answer in a
proceeding, and that the March 12, 1987 order, permitting the
parties only ten (10) days to inspect the file and submit an answer,
was arbitrary and capricious.
In addition, the petitioner attempts to demonstrate that it had
achieved the 80% removal rate for the non-rent impairing violations.
Noting that the MBR Unit had determined that all rent impairing
violations and 70% of the non-rent impairing violation had been
corrected, the petitioner argues that the owner had removed two (2)
Docket Number: BC 520014-RO
of the remaining four (4) violations to achieve the required 80%
rate. It submits, in rebuttal to the 1984 MBR list of pending
violations not deemed removed, letters from the former managing
agent dated between July 20, 1984 and August 26, 1985, to the Office
of Code Enforcement, arguing that the enumerated violations had been
corrected, were no longer in existence, or should had been deemed
waived as tenant-induced and not within the owner's power to remedy.
In this connection, the petitioner also submits that the owner was
deprived of the opportunity at MBR to cross-examine the Code
Enforcement inspector and to rebut the findings, or to establish
that the violation had been removed or should have been waived.
After careful consideration the Commissioner is of the opinion that
the petition should be denied.
The petitioner's suggestions that the proceedings denied the owner
due process have no substance. Conceding that the Administrator's
March 12, 1987 notice of proceeding to modify or revoke afforded the
tenant ten (10) days to make an appointment to review the records
and to submit written evidence to support this claim, the owner
failed to do so prior to the April 3, 1987 order, i.e., issued after
more than the twenty (20) days the owner characterizes as the normal
period the Division allows any party in which to answer a proceed
ing. In light thereof, the petitioner's attempt to extract separate
periods to investigate the claim and to submit an answer, in order
to make it appear that it was denied adequate time to present an
answer, must be rejected.
A review of the record also reveals that the owner was aware prior
to May 12, 1986 that the Administrator intended to revoke t e 1984-
1985 MBR eligibility order based on the owner's failure to achieve
the 80% violation removal required under the MBR regulations for
approval. The petitioner's complaint of not having access to
records fails to acknowledge that the reports of the on-site
inspection of the property were available to the owner at the Office
of Code Enforcement.
Nor does the owner establish on appeal, certification from the
Office of Code Enforcement that the violations were corrected, or
were removed based on determination that they were imposed in error,
or deemed waived as tenant induced. The letters from the prior
management agent to the Office of Code Enforcement noted above,
contrary to the petitioner's argument, are insufficient to establish
that the owner achieved the 80% violation removal rate required to
qualify for MBR eligibility.
With regard to the petitioner's argument that the owner should have
been permitted to cross-examine the Code Enforcement inspector in
the MBR proceedings, the Commissioner is of the opinion that request
to rebut the said inspector's findings should properly be directed
to the Office of Code Enforcement, which rendered those findings.
Docket Number: BC 520014-RO
The Commissioner further rejects the owner's argument that because
the 10-day notice only proposed to modify or revoke the prior
notification order, but not to affirm; the Division was precluded
from affirming the order. The Commissioner finds this proposition
to be devoid of reason. The petitioner would have the Commissioner
achieve a result contrary to both the law and facts in the case.
To further illustrate the petitioner's fallacious reasoning, the
Administrator would have been precluded from affirming the prior
order had the owner not submitted any response. Additionally, the
notice worked no prejudice to the owner's attempts to establish
facts and argument in support of the claim. In fact, the petitio
ners vigorous arguments illustrate that the owner was aware that the
prior revocation order would be affirmed unless the owner estab
lished the 80% violation removal rate. Having failed to do so, the
petitioner would nevertheless have the Administrator achieve a
THEREFORE, in accordance with the provisions of the Rent & Eviction
Regulations, the Rent Stabilization Law and Code, Chapter 403 of the
Laws of 1984, and Chapter 102 of the Laws of 1984, it is
ORDERED, that the owner's petition be and the same hereby is,
denied, and the Administrator's order be, and the same hereby is
affirmed, as provided above.