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STATE OF NEW YORK
DIVISION OF HOUSING AND COMMUNITY RENEWAL
OFFICE OF RENT ADMINISTRATION
92-31 UNION HALL STREET
JAMAICA, NEW YORK 11433
IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO. BG 210101 RO
: DRO DOCKET NO.K-3101990-RT
SELMA ASKINAZY TENANT: ELIZABETH ALLISON
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On July 3, 1987, the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on June
6, 1987, by the Rent Administrator, 10 Columbus Circle, New York,
New York, concerning the housing accommodations known as 444 15th
Street, Brooklyn, New York, Apartment No. 4L, wherein the Rent
Administrator determined that the owner had overcharged the
The Administrative Appeal is 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
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
March, 1984, of a rent overcharge complaint by the tenant who
first moved to the subject apartment on April 1, 1983 at a rental
of $500.00 per month.
The owner was served with a copy of the complaint and was
requested to submit rent records from the base date to prove the
lawfulness of the rent being charged. Subsequently the owner was
advised that treble damages would be imposed on any overcharge
occurring after April 1, 1984 for which the owner failed to
satisfy the Division that the overcharge was not willful. The
owner did not submit any rental history for the subject apartment
prior to April 1, 1983.
In Order Number CDR 30,445, 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 $4340.79
including treble damages on the overcharge occurring after April
1, 1984, and directed the owner to refund such overcharge to the
tenant as well as to reduce the rent.
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In this petition, the owner contends in substance that she
sent all her rent records to her former attorneys, that such
former attorneys had misplaced her rent records, that she had
extensive renovations done in the subject apartment prior to
occupancy by the tenant herein, and that in any event, if there
was an overcharge, it was not willful so that the imposition of
treble damages was not warranted.
The Commissioner is of the opinion that this petition should
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
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Appeals, N.Y.L.J., Feb. 15, 1990, p.25, col.1), that the Law in
effect at the 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. However, the owner herein did not submit a rental history
from April 1, 1980 so that the Rent Administrator's order
determining a rent overcharge on the basis of the owner's default
With regard to the owner's contention that she made extensive
renovations in the subject apartment prior to the occupancy of the
tenant herein, it is noted that this issue was raised for the
first time on appeal and cannot properly be considered herein
since this is not a de novo proceeding.
With regard to the imposition of treble damages, 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 show that the overcharge was not willful. The fact that the
owner's former attorneys may have misplaced the rental history
supplied to them by the owner does not establish that the
overcharge was not willful.
Because this determination concerns lawful rents only
through March 31, 1985, 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 adjustment.
This order may upon the expiration of the period in which the
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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 of the overcharge may
be offset against any rent thereafter due the owner.
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, denied, and, that the order of the Rent
Administrator be, and the same hereby is, affirmed.