BG 110347 RO; BH 110284 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 NO. BG 110347 RO;
BH 110284 RO
: DISTRICT RENT OFFICE
Saunders Street Associates, DOCKET NO. TC 81163 G
and CDR 30,852
Imperial Sterling Ltd,
TENANT: Herman and Mildred
Wolfson
PETITIONER :
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ORDER AND OPINION GRANTING PETITIONS FOR ADMINISTRATIVE REVIEW
On July 30, 1987 and August 11, 1987, the above-named petitioner-
owner and prior owner filed Petitions for Administrative Review
against an order issued on July 13, 1987, by the Rent Administrator,
10 Columbus Circle, concerning the housing accommodations known as
63-45 Saunders Street, Queens, New York Apartment No. 2F wherein the
Rent Administrator determined that the owner had overcharged the
tenant.
These petitions are being consolidated for disposition herein.
The Administrative Appeals are being determined pursuant to the
provisions of Section 2526.1 of the Rent Stabilization Code.
The issue herein is whether the Rent Administrator's order was
warranted.
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 by the filing in January
1984 of a rent overcharge complaint by the tenant.
In answer to the tenant's complaint, the owner stated in substance
that the apartment rent ledgers and leases from April 1975 through
July 1978 were not available and submitted a rental history from
July 1, 1968 through March 31, 1975 and August 1, 1978 through
January 31, 1986.
In Order Number 30,852 as amended, the Rent Administrator determined
that, due to the owner's failure to submit a complete rental
history, the tenant had been overcharged in the amount of $10,069.96
and directed the owner to refund such overcharge to the tenant as
well as to reduce the rent.
BG 110347 RO; BH 110284 RO
In these petitions, the owners contend in substance that they did
not default as they submitted all the rent records they had. The
owners submitted rent ledgers from September, 1976 through June,
1978 which were not submitted during the proceeding before the Rent
Administrator.
In answer to the owners' petitions, the tenant stated in substance
that the Rent Administrator's order was warranted and questioned why
the ledgers which the owner stated were unavailable during
processing are now being submitted.
The Commissioner is of the opinion that this petition should be
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 subject
to rent stabilization, if later) and to produce such records to the
DHCR upon demand.
Section 26-516 of the Rent Stabilization Law, effective April 1,
1984, limited an owner's obligation to provide rent records by
providing that an owner may not be required to maintain or to
produce rent records for more than four (4) 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 rights 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 the 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 Dept.,
1989). motion for leave to reargue or for leave to appeal to the
Court of Appeals denied ( App. Div. 2d Dept., 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, 1989, p.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
BG 110347 RO; BH 110284 RO
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
produce more than four years of rent records.
Since the issuance of the decision in JRD, the Appellate Division,
First Department, in the case of Lavanant v. DHCR, 148 A.D.2d 185,
544 N.Y.S.2d 331 (App. Div. 1st Dept. 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. An examination
of the rent records from April 1, 1980 which records were submitted
during the course of the proceeding before the Rent Administrator,
discloses that no rent overcharge occurred. Therefore, the Rent
Administrator's order finding a rent overcharge must be revoked.
If the owner has already complied with the Rent Administrator's
order and there are arrears due to the owner as a result of the
instant determination, the tenant is permitted to pay off the
arrears in 24 equal monthly installments. Should the tenant vacate
after the issuance of this order or have already vacated, said
arrears shall be payable immediately.
THEREFORE, in accordance with the Appellate Division ruling in JRD,
it is
ORDERED, that these petitions for administrative review be, and the
same hereby are granted, that the order of the Rent Administrator
be, and the same hereby is, revoked, and it is found that no rent
overcharge occurred.
ISSUED:
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner
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