BD-210444-RO; BD-210154-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 NOS.: BD-210444-RO
BD-210154-RO
MYRA REALTY CO., D.R.O. DOCKET NO.:
K-310707-R
PETITIONER CDR 29,447
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ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
IN PART
On April 20, 1987 the above named petitioner-owner filed a
Petition for Administrative Review against an order of the Rent
Administrator 10 Columbus Circle, New York, New York, issued
March 20, 1987. The order concerned housing accommodations known
as Apartment 1-G, 300 Ocean Parkway, Brooklyn, New York. The
Administrator determined that the tenant had been overcharged.
The Commissioner has reviewed the record and has carefully
considered that portion relevant to the issues raised by the
administrative appeal.
The tenant commenced the proceeding by filing a rent overcharge
complaint on March 5, 1984. The petitioner failed to submit a
rental history. The Administrator adjudged a default and applied
the procedures based on Section 42A of the former Rent
Stabilization Code. A base rent of $268.58 was calculated and
total overcharges of $4755.87 were assessed including treble
damages and excess security.
The Commissioner notes, initially, that this proceeding was
erronously assigned two docket numbers. Since both involve the
identical proceeding they are both consolidated for decision.
The petitioner makes several arguments in urging reversal. One
argument is that the Administrator improperly and adjudged
adefault because the required rental history was submitted. As
petitioner has raised the rental history issue, the Commissioner
is required to grant the petition. After careful consideration,
the petition is granted.
Section 42A of the former Rent Stabilization Code requires that
an owner retain complete records for each stabilized apartment in
effect from June 30, 1974 (or the date the apartment became sub-
ject to rent stabilization, if later) to date and to produce such
records to the DHCR upon demand.
Section 26-516 of Rent Stabilization Law, effective April 1,
1984, limited an owner's obligation to provide rent records by
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providing that an owner may not be required to maintain or
produce rent records for more than four years prior to the most
recent registration, and concomitantly, established a four year
limitation on the calculation of rent overcharges.
It has been the DHCR's policy that overcharge complaints filed
prior to April 1, 1984 are to be processed pursuant to the Law or
Code in effect on March 31, 1984. (See Section 2526.1(a)(4) of
the current Rent Stabilization Code.) The DHCR has therefore
applied Section 42A of the former Code to overcharge complaints
filed prior to April 1, 1984, requiring complete rent records in
these cases. In following this policy, the DHCR has sought to be
consistent with the legislative intent of the Omnibus Housing Act
(Chapter 403, laws of 1983), as implemented by the New York City
Conciliation and Appeals Board (CAB), the predecessor agency to
the DHCR, to determine rent overcharge complaints filed with the
CAB prior to April 1, 1984 by applying the law in effect at the
time such complaints were filed so as not to deprive such tenants
of their right to have the lawful stabilized rent determined from
the June 30, 1974 base date and so as not to deprive tenants
whose overcharge claims accrued more than four years prior to
April 1, 1984 of their right to recover such overcharges. In
such cases, if the owner failed to produce the required rent
records the lawful stabilized rent would be determined pursuant
to the default procedure approved by the Court of Appeals in 61
Jane Street Associates v. CAB, 65 N.Y.2d 898, 493 N.Y.S.2d 455
(1985).
However, it has recently been held in the case of J.R.D. Mgmt. v.
Eimicke, 148 A.D. 2d 610, 539 N.Y.S.2d 667 (App. Div. 2d Dep't
1989), motion for leave to reargue or for leave to appeal to the
Court of Appeals denied (App. Div. 2d Dep't, N.Y.L.J., June 28,
1989, p.25, col.1) motion for leave to appeal to the Court of
Appeals denied (Court of Appeals, N.Y.L.J., Nov. 24, col.4).,
motion for leave to reargue denied (Court of Appeals, N.Y.L.J.,
Feb. 15, 1990, p.25, col. 1), that the law in effect at the time
of the determination of the administrative complaint rather than
the law in effect at the time of the filing of the complaint must
be applied and that the DHCR could not require an owner to pro-
duce more than four years of rent records.
Since the issuance of the decision in JRD, the Appellate
Division, First Department, in the case of Lavanat v. DHCR, 148
A.D.2d 185, 544 N.Y.S.2d 331 (App. Div. 1st Dept't 1989), has
issued a decision in direct conflict with the holding in JRD.
The Lavanant court expressly rejected the JRD ruling, finding
that the DHCR may properly require an owner to submit complete
rent records, rather than records for just four years, and that
such requirement is both rational and supported by the law and
legislative history of the Omnibus Housing Act.
Since in the instant case the subject dwelling unit is located in
the Second Department, the DHCR is constrained to follow the JRD
decision in determining the tenant's overcharge complaint,
limiting the requirement for rent records to April 1, 1980.
Applying JRD to the instant case, the Commissioner must accept
the April 1, 1980 rent ($300 per month) as proper. The sole is-
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sue remaining is whether the subsequent increases fell within the
guides. The Commissioner finds that they did for example, the
lease beginning December 1, 1981 was for a monthly rental of
$348.00 and for a three-year term. Petitioner was permitted a
16% increase under Guideline 13 for a three-year renewal lease.
Thus, 300 + 16%/month. The Commissioner finds the two succeeding
leases (beginning December 1, 1984 and 1986) to be proper. The
Administrator's order is, accordingly revoked.
If the current owner has already complied with the Adminis-
trator's order and arrears are due and owing due to the present
determination, the current owner is directed to allow the tenant
to pay off said arrears in twelve equal monthly installments.
Should the tenant vacate the apartment, or have previously
vacated, said arrears are due and payable immediately.
THEREFORE, pursuant to the Rent Stabilization Law and Code it is
ORDERED, that this petition be, and the same hereby is granted
and that the Rent Administrator's order be, and the same hereby
is, revoked.
ISSUED:
ELLIOT SANDER
Deputy Commissioner
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