DOC. NOS.: BD 410182-RT et al.
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 NOS. BD 410182-RT
JAY GOULD, BD 410061-RT
: D.R.O. DOCKET NO.:
PETITIONER : TC-083021-G
-------------------------------------X CDR 29482
ORDER AND OPINION GRANTING PETITION
FOR ADMINISTRATIVE REVIEW
On April 6, 1987 the above-named petitioner-tenant filed a Petition
for Administrative Review against an order issued on March 16, 1987
by the Rent Administrator, 10 Columbus Circle, New York, New York,
concerning the housing accommodations known as 363 East 76th Street,
New York, New York Garage Space GA26 wherein the District Rent
Administrator determined that the owner had not overcharged the
tenant. The tenant's petition was assigned two docket number.
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 in this appeal is whether the District Rent Administrator's
order was warranted.
The applicable sections of the Law are Section 2520.6 and 2526.1 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.
The proceeding was originally commenced in February 1984 by the
filing of a rent overcharge complaint by the tenant in which the
tenant stated in substance that the garage is owned and operated by
the building owners and therefore the garage space leases should be
subject to the Rent Stabilization Law and Code; that he is being
overcharged in the rent for his garage space and that the owner
refuses to give him three year leases for the garage space as he
requested but offers one year leases only. The tenant listed the
owner of the subject premises as Sherman Tower Realty Associates, c/o
Sulzberger-Rolfe, Inc.
DOC. NOS.: BD 410182-RT et al.
In support of these contentions the tenant stated that he has always
had three year renewal leases for the subject apartment. In addition
the tenant submitted copies of all his garage space leases beginning
with the lease commencing May 1, 1976. The May 1, 1976 garage space
lease lists the landlord as "Sherman Tower Realty Associates" as do
the leases commencing May 1, 1977, July 1, 1978 and July 1, 1979.
The garage space leases commencing July 1, 1980, July 1, 1981, July
1, 1982 and July 1, 1983 list the landlord as "Sulzberger-Rolfe, Inc.
as Agent for John Guttierez".
In answer to the tenant's complaint "Sulzberger-Rolfe Inc." stated in
substance that the garage space is not subject to the Rent
Stabilization Law and Code in that on the base date, May 31, 1968,
the garage space had been leased to an independent garage operator.
From 1967 through 1976 the independent operator was Joseph Slobodin
and from 1976 to 1984 the independent operator was John Guttierez.
In support of its contentions, the owner submitted a copy of the
lease between the owner and Mr. Slobodin for the garage space
commencing March 1, 1967 and terminating February 28, 1969.
In reply to the owner's answer, the tenant stated in substance that
after the death of Joseph Slobodin in March or April of 1976, the
owner began operation of the garage itself and that John Guttierez is
the superintendent of the subject premises.
In Order Number CDR 29482, the Rent Administrator found that the
garage space was leased to independent garage operator Joseph
Slobodin from 1967 to 1976 and leased to independent garage operator
John Guttierez from 1976 to 1984 and that since the owner of the
subject premises did not operate the garage, the garage spaces were
not subject to the Rent Stabilization Law and Code.
In this petition the tenant alleges in substance that after Joseph
Slobodin died in early 1976, the owner began to operate the garage so
that the garage spaces should have been found subject to the Rent
Stabilization Law and Code.
In answer to the petition, "Sulzberger-Rolfe, Inc." advised that it
was no longer the managing agent for the subject premises and that in
August 1986, "363 East 76 Street Associates" became the new managing
agent.
A copy of the Rent Administrator's order and the tenant's petition
was sent to the new managing agent "363 East 76 Street Associates" on
January 16, 1991 and it was given a chance to submit an answer in
this proceeding. In a response dated June 11, 1991, the current
owner stated in substance that the fact that an independent
contracator operated the garge on the base date is dispositive of the
proceeding and that subsequent garage leases between the owner or
second contractor (superintendent) and tenant do not establish that
the garage was no longer operated by an independent contractor.
The Commissioner is of the opinion hat this petition should be
granted.
Section 2520.6(r)(4)(xi) of the current Rent Stabilization Code
provides in pertinent part that ancillary services such as garage
facilities for which there is or was a separate charge shall not be
DOC. NOS.: BD 410182-RT et al.
subject to the provisions of the Rent Stabilization Code where no
common ownership between the operator of such service and the owner
exists or existed on the applicable base date, or at any time
subsequent thereto, and such service is or was provided on the
applicable base date and at all times thereafter by an independent
contractor pursuant to a contract or agreement with the owner.
Where, however, on the applicable base date or at any time subsequent
thereto, there is or was a separate charge, and there is or was
common ownership, directly or indirectly, between the operator of
such service and the owner, or the service was provided by the owner,
any increase, other than the charge provided in the initial agreement
with a tenant to lease, rent or pay for such service, shall conform
to the applicable rent guidelines rate.
In the instant case the evidence of record including copies of the
garage space leases discloses that from May 1, 1976 to at least July
1, 1983 the garage was operated either by the owner itself "Sherman
Tower Realty Associates" or by the superintendent John Guttierez - an
agent not independent of the owner. Accordingly the garage space is
subject to the applicable rent guidelines rate of the Rent
Stabilization Law pursuant to Section 2520.6(r)(4)(xi). Further the
tenant was entitled to select three year renewal leases for the
garage space just as he selected three year apartment renewal
leases. However, commencing October 1, 1984 only one or two year
leases may be selected.
Section 2526.1 of the Rent Stabilization Code provides in pertinent
part that any owner who is found by the DHCR to have collected any
rent or other consideration in excess of the legal regulated rent on
and after April 1, 1984 shall be ordered to pay to the tenant a
penalty equal to three times the amount of such excess. If the owner
establishes by a preponderance of the evidence that the overcharge
was not willful, the DHCR shall establish the penalty as the amount
of the overcharge plus interest from the date of the first overcharge
on or after April 1, 1984.
In the instant case the owner has not submitted any evidence to
establish that the overcharge was not willfull. Further the owner
was advised in the proceeding before the Rent Administrator of the
possible imposition of treble damages and tahe Commissioner has
previously imposed treble damages in cases involving garage
overcharges - DI 610132RO. Therefore the imposition of treble
damages was warranted.
Taking the aforementioned factors into account, the Commissioner has
calculated the lawful stabilization rents and the amount of the rent
overcharge for the subject garage space.
The lawful stabilization rents and amount of the rent overcharge are
set forth on the amended rent calculation chart attached hereto and
made a part hereof.
Because this determination concerns lawful rents only through June
30, 1985, the owner is cautioned to adjust subsequent garage rents to
an amount no greater than that determined by this order plus any
lawful increases, and to register the garage rents with this order
DOC. NOS.: BD 410182-RT et al.
and opinion being given as the explanation for the registration.
This order may upon the expiration of the period in which the owner
may institute a proceeding pursuant to Article 78 of the Civil
Practice Law and Rules, be filed and enforced as a judgment or not in
excess of twenty percent per month thereof may be offset against any
rent thereafter due the owner.
THEREFORE, in accordance with the Rent Stabilization Law and Code, it
is
ORDERED, that this petition be, and the same hereby is, granted and
the District Rent Administrator's order be and the same hereby is,
modified in accordance with this order and opinion. The lawful
stabilization garage rents are established on the attached chart
which is fully made a part of this order. The amount of the rent
overcharge through June 30, 1985 is $5415.20.
ISSUED:
ELLIOT SANDER
Deputy Commissioner
ADMINISTRATIVE REVIEW BUREAU
COVERING MEMORANDUM
ARB Docket Nos.: BD 410182-RT, BD 410061-RT
DRO Docket No/Order No.: TC-O83021-G, CDR 29 482
Tenant(s): Jay Gould
Owner: Sherman Tower Realty Associates
Code Section: 2520.6 and 2526.1 of the RSC
Premises: Garage Space GA26 at 363 East
76th Street, New York, N.Y.
ORDER AND OPINION GRANTING PETITION
FOR ADMINISTRATIVE REVIEW
Petition granted on basis that there was common ownership of
subject building and garage operation so that garage spaces
are subject to Rent Stabilization guideline increases.
APPROVED:
Processing Attorney:
Supervising Attorney:
Deputy Counsel:
Deputy Commissioner:
Mailed copies of Order and Determination to:
Tenant(s)
Owner
Tenant's Atty
Owner's Atty
Date: : by
signature
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