BE 210058-RT
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.:
BE 210058-RT
VICTORINE ROONEY, DRO DOCKET NO.:
K-3105533-R
PETITIONER CDR 29,903
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ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On May 15, 1987, the above-named petitioner-tenant filed a Peti-
tion for Administrative Review against an order of the Rent
Administrator issued April 15, 1987. The order concerned housing
accommodations known as Apartment 8-A located at 1401 Elm Avenue,
Brooklyn, New York. The Administrator found that the tenant had
been overcharged.
The Commissioner has reviewed the record and carefully considered
that portion relevant to the issues raised by this appeal.
The tenant commenced this proceeding by filing an overcharge
complaint on February 29, 1984 in which she stated that she moved
into the subject apartment on September 1, 1982 pursuant to a 14
month lease at a rental of $235.38 per month.
The tenant's complaint was served on the owner on October 15,
1984 and on October 29, 1984, the owner submitted an answer
including a Report of Statutory Decontrol showing that the
controlled tenant vacated on February 28, 1978, a complete set of
leases, and a copy of a letter dated October 22, 1984 from the
owner to the tenant acknowledging that the tenant had been
overcharged due to a clerical error made in computing the
tenant's vacancy rent. The owner also advised the tenant in this
letter that her rent was being reduced to $246.22 effective
November 1984 and that a refund check of $141.32 was enclosed.
The Administrator determined that the tenant had been overcharged
beginning with the tenant' first lease and directed the owner to
refund to the tenant $348.94 which reflected the refund of
$141.32 but included excess security and interest on overcharges
collected after April 1, 1984. On April 23, 1987, the owner
advised the Division by letter that pursuant to the Adminis-
trator's order, the owner had refunded $348.94 to the tenant. A
copy of the refund check was enclosed.
In the petition for administrative review, the tenant contends
that the Administrator's order should be modified to include
BE 210058-RT
treble damages because the owner did not establish that the over
charge was not willful.
The owner answers and asserts that an error w s made in calcu-
lating the rent for which the owner should not be unreasonably
penalized in view of the fact that the error was corrected and
the tenant was reimbursed. The owner lists other overcharge
proceedings filed by other tenants in buildings owned by this
owner in which the Division determined that the rents being
charged were lawful. The owner asserts that this establishes a
pattern of consistently charging the legal rent and a lack of
willful overcharging.
The owner did not file its own petition.
After careful consideration, the Commissioner is of the opinion
that the tenant's petition should be denied.
Section 2526.1(a)(1) of the Rent Stabilization Code provides for
the penalty of treble damages on overcharges unless the owner
establishes by a preponderance of the evidence that the over-
charge was not willful. The Division's position on the applica-
tion of treble damages upon the finding of a rent overcharge was
clarified in Policy Statement 89-2 which describes, inter alia,
certain circumstances in which the burden of proof in estab-
lishing lack of willfulness will be deemed to have been met.
One such situation is where an owner adjusts the rent on his or
her own within the time afforded to interpose an answer to the
proceeding and submits proof to the DHCR that he or she has
tendered, in good faith, to the tenant a full refund of all
excess rent collected, plus interest.
In the instant case, the owner was served with the tenant s com-
plaint on October 15, 1984 and on October 29, 1984, before the 20
days within which to answer had expired, the owner adjusted the
tenant's rent to what it believed to be the lawful rent and sub-
mitted proof that $141.32 was refunded to the tenant. Although
the Administrator's order directed the owner to refund additional
overcharges, a careful review of the Rent Calculation chart re-
veals that certain errors were made in the tenant's favor. With
the additional refund made by the owner subsequent to the Admin-
istrator's order, the tenant may have received a refund in excess
of what was due her. In view of the owner's apparent good faith
efforts to charge a lawful rent and to make appropriate refunds
of overcharges, the owner had adequately established a lack of
willfulness and an imposition of treble damages is inappropriate
and unwarranted.
THEREFORE, pursuant to the Rent Stabilization Law and Code, it is
ORDERED, that this petition be, and the same hereby is, denied
and that the Rent Administrator's order be, and the same hereby
is, affirmed.
ISSUED:
BE 210058-RT
ELLIOT SANDER
Deputy Commissioner
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