BG 110255 RO

                                STATE OF NEW YORK
                          OFFICE OF RENT ADMINISTRATION
                                   GERTZ PLAZA
                             92-31 UNION HALL STREET
                             JAMAICA, NEW YORK 11433

      APPEAL OF                              DOCKET NO. BG 110255 RO

                                          :  DISTRICT RENT OFFICE
                                             DOCKET NO. ZQ 001228 R
           Parman Corp.,                    
                                             TENANT: Elham Sarvdadi           

                            PETITIONER    : 


      On July 23, 1987, the above-named petitioner-owner filed a Petition for 
      Administrative Review against an order issued on July 6, 1987, by the 
      Rent Administrator, 92-31 Union Hall Street, Jamaica, 
      New York, concerning the housing accommodations known as 104-40 Queens 
      Boulevard, Queens, New York, Apartment No. 12Y, wherein the District 
      Rent Administrator determined that the tenant had been overcharged.

      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.  

      This proceeding was originally commenced in March 1985 by the filing of 
      a rent overcharge complaint by the tenant who stated he took occupancy 
      pursuant to a one year lease commencing December 1, 1984 and expiring 
      November 30, 1985 at a monthly rent of $690.25 which included two new 
      air conditioners and electricity charges for same.  Electricity is 
      included in the rent of the subject apartment.   The tenants asserted 
      that based on the prior rent of $527.65, the vacancy rent for the 
      subject apartment should be $650.23 including air conditioning and 

      The owner stated that it calculated the rent of $690.25 pursuant to 
      Guidelines 16 under which it concluded that it was entitled to a 13.5% 
      increase over the prior rent of $527.65 (7.5% vacancy allowance and 6% 
      guideline increase) plus $51.35 for new equipment installed at a total 
      cost of $2054.00 (1/40 of $2054.00 = $51.35) and $40.02 for electricity 
      for 2 additional air conditioners.

          BG 110255 RO

      On April 20, 1987 the owner was directed by the DHCR to submit copies of 
      bills and cancelled checks to document the claimed improvements.  In 
      response the owner submitted the required documentary evidence for all 
      the items except for the air conditioners.

      In Order Number ZQ 001228 R, the District Rent Administrator determined 
      the initial stabilized rent of the complaining tenant to be $650.23 
      based on a $13.5% increase (6% guideline  and 7.5% vacancy allowance) 
      over the prior rental of $527.65 plus an increase of $51.35 for new 
      equipment installed prior to occupancy.  It further determined that a 
      rent overcharge of $1459.35 had occurred through July 31, 1987 including 
      interest on that portion of the overcharge occurring on and after April 
      1, 1984 and directed the owner to refund such overcharge to the tenant. 

      During the pendency of the instant proceeding, the tenant vacated but 
      forwarded his current address.

      In this petition, the owner contends in substance that the Rent 
      Administrator omitted the increase for electrical use for the two 
      additional air conditioners which were installed in December 1984.  
      Further, the Rent Administrator's increase for new equipment of $51.35 
      did not include 1/40th of the cost of the 2 new air conditioning units.  
      The owner submitted a pro-rated bill for $755.58 indicating the cost of 
      the 2 units and claiming an additional 1/40 increase of $18.89.  The 
      bill was not submitted to the Rent Administrator because the owner 
      stated it was requesting less than the full amount to which it was 
      entitled for the installation.

      In answer to the owner's petition, the tenants responded that they did 
      not know the owner was charging electrical fees for the 2 additional 
      units and had they had the option would not have accepted the 2 
      additional units.

      The Commissioner is of the opinion that this petition should be granted 
      in part.

      The owner is correct in its contention that electric charges for air 
      conditioners installed prior to October 1, 1985 (where electricity is 
      included in the rent) are included in the base rent and not listed as 
      separate charges which change annually as is true for such air 
      conditioners first installed on or after October 1, 1985.  An 
      examination of the records in this case discloses that the Rent 
      Administrator erred in not including the electrical fee of $19.43 for 
      each of the two air conditioners installed immediately prior to 
      occupancy by the tenants herein (1985 air-conditioning season annual fee 
      of $233.07).  The inclusion of the 2 air conditioner fees results in a 
      vacancy rent of $689.09 not $690.25 as the owner contends.

      The Commissioner rejects the owner's submission of the additional bill 

          BG 110255 RO

      for the actual cost of the installation of the two new air conditioners 
      to be used as the basis of an additional increase pursuant to Section 
      2522.4(a)(1) since an examination of the records in this case discloses 
      that in the proceeding before the Rent Administrator, the owner did not 
      submit the bill or claim the increase for the two air conditioners cost 
      although afforded an opportunity to do so and has not submitted a 
      reasonable excuse for its failure to do so.  Since this is not a de novo 
      proceeding the owner's submission cannot be considered for the first 
      time on appeal.

      With regards to the tenant's contention that the acceptance of the 2 
      additional air conditioners was a condition of rental, it is noted that 
      Section 2522.4(a)(1) of the Rent Stabilization Code, does not require 
      the owner to secure a tenant's consent for installation of new equipment 
      during a period of vacancy.  Further, the tenant did not raise the issue 
      of conditional rental in the proceeding before the Rent Administrator so 
      that this matter cannot properly be considered for the first time on 
      administrative appeal.

      Taking the aforementioned factors into account, the Commissioner has re- 
      calculated the lawful stabilization rent and amount of rent overcharge 
      for the subject apartment.  The lawful stabilization rent and amount of 
      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      July 
      31, 1987, the owner is cautioned to adjust subsequent rents to an amount 
      no greater than that determined by this order plus any lawful increases, 
      and to register any adjusted rents with this order and opinion being 
      given as the explanation for the adjustments.

      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 in the same manner as a judgment.

      THEREFORE, in accordance with the provisions of the Rent Stabilization 
      Law and Code, it is

      ORDERED, that this petition for administrative review be, and the same 
      hereby is, granted in part, and, that the order of the Rent 
      Administrator be, and the same hereby is, modified in accordance with 
      this order and opinion.  The lawful stabilization rents and the amount 
      of the rent overcharge are established on the attached chart which is 
      fully made a part of this order.  The amount of the rent overcharge 

          BG 110255 RO

      through July 31, 1987 is $43.45.


                                      JOSEPH A. D'AGOSTA
                                      Acting Deputy Commissioner



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