ADM. REVIEW DOCKET NO.: BE 410437 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
------------------------------------X
IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO.: BE 410437 RO
: D.R.O. ORDER NO.:
CDR #29,252
D.R.O DOCKET NO.:
TC 74662-G
DAVID RITTER
(KENSINGTON HOUSE, INC.)
Tenant: Martin Levine
PETITIONER :
------------------------------------X
ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
IN PART
On May 11, 1987, the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
April 14, 1987, by the Rent Administrator at 10 Columbus Circle,
New York, New York, concerning housing accommodations known as
Apartment Number 302 at 200 West 20th Street, New York, New York,
wherein the Administrator established the stabilized rent and
directed the owner to refund $13,917.49 including interest from
April 1, 1984.
The Commissioner notes that this proceeding was initiated
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 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.
This proceeding was originally commenced on July 29, 1983 by
the filing of a complaint of rent overcharge with the New York
City Conciliation and Appeals Board (CAB, the agency formerly
charged with enforcing the Rent Stabilization Law) by the tenant,
Martin Levine.
The owner submitted a rental history from the base date.
On the chart attached to and made a part of the order, based
on a finding that the rental documentation submitted by the owner
was not complete, the Administrator established the stabilized
rent, using the 42A default procedure.
ADM. REVIEW DOCKET NO.: BE 410437 RO
In its Petition, the owner contends that the Administrator
erred in failing to acknowledge that the owner had submitted a
complete rental history as of December 30, 1986; that is, almost
four months before the appealed order was issued. The owner has
submitted a rent calculation chart with its petition. The owner
asserts that the overcharges collected from the tenant amount to
$4,123.89. The owner notes [as the tenant's representative
acknowledged below] that prior to the issuance of the order
herein, the owner had refunded said sum to the tenant.
The tenant's answer opposing the Petition asks that the
order of the Rent Administrator be affirmed, and that the
Petition be denied. Further, the tenant asserts, in substance
(in its answer and in subsequent responses to the arguments set
forth in various post-petition papers submitted by the owner),
that 1) the owner's submission of a complete rental history below
was untimely; 2) the overcharge should be calculated through the
time of the determination of the Petition; 3) treble damages
should have been imposed; and 4) the tenant should be permitted
to raise the issue of treble damages even though he did not file
his own petition because the tenant did not file a Petition so as
not to further delay the collection of the award provided for in
the order below and, further, the owner's bad faith in, among
other things, dragging out the proceedings below (taking so long
to submit records it obviously had all along) warrants the
imposition of treble damages on appeal. The tenant also argued
that the tenant's complaint should be remanded for processing as
a Fair Market Rent Appeal (FMRA) because the DC-2 the owner had
served on a prior tenant was defective in a way that rendered it
ineffective as the notice intended by the Code in effect on April
30, 1987. The tenant asserts that this defect was created when
the owner inserted the following sentence at the end of the
paragraph (the third paragraph in the form) wherein the (then)
tenant was advised that the Initial Legal Regulated Rent was
$285.00 per month; the owner added: "This rent [the Initial
Legal Regulated Rent of $285.00 per month] is based on comparable
rents in this building." The tenant, herein, states that because
of this defect, the service of this DC-2 notice on the subject
prior tenant did not start the Statute of Limitations running for
the filing of a FMRA and, therefore, the tenant's complaint was
filed before the time for filing a FMRA had expired. The tenant
cites three separate orders and opinions issued by the
Commissioner in support of his position on this point.
The Commissioner is of the opinion that the Petition should
be granted in part.
The Commissioner finds that the owner timely submitted a
complete rental history below and that the Administrator's use of
the 42A procedure was unwarranted. The Commissioner further
finds that the overcharges to be refunded and the tenant's rent
under his May 1, 1986 to April 30, 1988 lease are as shown on the
chart annexed hereto and made a part hereof.
ADM. REVIEW DOCKET NO.: BE 410437 RO
The Commissioner notes that the tenant's stabilized rent
under his May 1, 1986 to April 30, 1988 lease was what the owner
had calculated it to be in the chart the owner had submitted to
the Administrator on December 30, 1986: $582.45. The
Commissioner further notes that the tenant's representative's
letter of January 15, 1987 acknowledged receipt of a check by the
tenant for $4,205.12, representing the overcharges plus excess
security due the tenant as per the owner's calculations. The
tenant further acknowledged, in its initial (September 18, 1987)
answer to the Petition, that as of January 1, 1987, the owner had
adjusted the tenant's rent to $582.45. Therefore, the
Commissioner finds, as indicated in the annexed chart, that there
were no overcharges after December 31, 1986; and that the net sum
to be refunded to the tenant is the total of the overcharges
shown on the annexed chart, $4,389.36, less the amount refunded
by the owner $4,205.12; that is $184.24.
The Commissioner finds that the tenant's contention as to
treble damages is beyond the scope of review on appeal as it was
not raised in a PAR filed by the tenant.
The Commissioner finds that the tenant's contention, that
the DC-2 form submitted was rendered defective by the cited
insertion, is without merit. The facts underlying the orders and
opinions cited by the tenant involved extensive
misrepresentations by the respective owners; misrepresentations
that were so materially misleading that they would, if believed,
have created a serious doubt in the mind of a reasonable person
as to whether or not that person might be entitled to file a
FMRA. The Commissioner finds that there is nothing in the record
that indicates that the language inserted by the owner was a
misrepresentation. The Commissioner also finds that if said
insertion had stated a misrepresentation and if the tenant upon
whom the DC-2 had been served had believed it, that tenant would
still have been apprised by this DC-2 that that tenant was
entitled to file a FMRA.
This DC-2 states that the 1974 Maximum Rent was $149.00.
The enlarged print on the form clearly states that if the Initial
Legal Regulated Rent exceeds the 1974 Maximum Rent, plus an
applicable Guidelines increase of 9% (for a one year lease), 11%
(for a two year lease) or 12 1/2% (for a three year lease), the
tenant is entitled to file a FMRA. The tenant served with the
DC-2, Fereshteh Mirsepassi, took occupancy as the first
stabilized tenant under a thirteen month (for Guidelines
purposes, a two year) lease. Clearly, this tenant could see that
$149.00 plus 11% equals $165.39 (a sum substantially less than
the Initial Legal Regulated Rent) and that, therefore, that
tenant was entitled to file a FMRA.
The Commissioner points out that by a letter dated May 18,
1990, the tenant's representative has advised that the tenant
purchased the subject apartment in December of 1987 and that as
to the relevance of that fact to the collection of the balance of
the overcharge shown due on the annexed chart, it is the same as
if the tenant had vacated. Therefore, this order may, upon the
ADM. REVIEW DOCKET NO.: BE 410437 RO
expiration of the period in which the owner may institute a
proceeding pursuant to Article Seventy-eight of the Civil
Practice Law and Rules, be filed and enforced by the tenant in
the same manner as a judgment.
THEREFORE, pursuant to the Rent Stabilization Law and Code,
it is
ORDERED, that the Petition be, and the same hereby is
granted in part; and that the order of the Administrator be, and
the same hereby is, amended in accordance with this order and
opinion.
ISSUED:
ELLIOT SANDER
Deputy Commissioner
|