BG 210383 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 210383-RO
A & A REALTY COMPANY,
D.R.O ORDER NO.: ZK 005144-R
TENANT: RIVA EZEKOWITZ
PETITIONER
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ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
IN PART
On July 17, 1987 the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
June 16, 1987, by the Rent Administrator, 92-31 Union Hall
Street, Jamaica, New York, concerning housing accommodations
known as Apartment 5B, 1280 East 12th Street, Brooklyn, New York,
wherein the Rent Administrator determined that there had been an
overcharge and ordered a refund of $928.21, including interest
and excess security.
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.
The tenant commenced this proceeding on October 21, 1985 by
filing an overcharge complaint alleging that her initial two year
lease commencing June 1, 1985 had a rent of $510.00, whereas the
prior rent had been $278.00. The tenant noted that the rent had
been raised an unspecified amount for a new stove and
refrigerator and "other work," including new windows installed in
1983. More specifically, she claimed the owner was charging two
much for work and equipment such as $4,100.00 for a new sink and
cabinets for which the tenant alleged she priced a comparable set
for approximately $2,000.00.
In answer to the complaint, the tenant alleged that the April 7,
1984 registered rent was $278.40 and the prior tenant had not
challenged that figure, although given the opportunity to do so.
Proof of service of the registration forms was submitted.
In addition the owner submitted documentation of $7,110.84 in
improvements to the subject apartment, including $1,050.00 for
six thermal windows. ($362.63 for floor scraping was also
alleged, but not included in the $7,110.84 total.)
Based thereon the owner contended it was allowed a $177.77
increase so that the tenant's initial rent was lawful.
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In Order Number ZK 005144-R, herein under review, the Rent
Administrator determined that the prior rent of $278.40 was the
base rent and allowed the owner a rent increase of one-fortieth
of $6,060.84 ($151.52), being all the alleged improvements except
for the $1,050.00 for windows and the $362.63 for floor scraping.
The windows were disallowed because they were part of a building
wide improvement.
In this petition, the owner contends that the Rent
Administrator's Order is incorrect and should be modified because
the Administrator should have either allow d the owner a one-
fortieth increase for the windows, or used the Major Capital
Improvement (MCI) increase therefor (Z-KCS 000490-OM, issued June
18, 1986) to offset the overcharge. The owner submitted rent
calculations for each alternative. In addition the owner alleges
certain spelling errors in the Administrator's Order. Finally,
the owner contends that the Administrator's Order was invalid
since it was not signed.
In answer to this petition, the tenant contends that the order
should be upheld because neither the floor scraping nor the
windows should be part of the rent increase for improvements. In
addition, the tenant alleges that the cost of the other
improvements was "exorbitant" and that she had not been given an
opportunity to challenge the owner's evidence for these
improvements. She asks for a hearing on this issue.
Regarding the owner's calculations in which the windows were
treated as part of an MCI, the tenant states that the MCI order
allowed a 7.69% increase based on the March 1985 rent ($278.40)
rather than on the $475.86 determined by the Administrator to be
the lawful June 1, 1985. (The owner used the latter figure in
its calculations.) The tenant showed the owner's calculations in
a column marked "A", her corrections in "B" and said that "Column
C" would show an even lesser lawful rent if the tenant were given
the opportunity to challenge the cost of the other improvements.
In addition, the tenant alleges her initial lease did not contain
a clause specifically authorizing an MCI increase for
improvements already applied for. Accordingly, she contends that
she could not be charged for the MCI until Jun 1, 1987 and no
part of the retroactive portion of the MCI increase can be
charged to her.
Finally, she alleges that no kitchen floor was ever installed.
In a reply dated December 1, 1987 the owner (1) alleges the
tenants answer was untimely, (2) notes that the "Column C"
referred to by the tenant does not appear in her answer, (3)
points out that the $362.63 floor scraping charge was not
included in the increase for improvements granted by the
Administrator, (4) alleges that an owner is not required to
renovate at the lowest possible price, (5) notes that the tenant
did not file a timely petition, implying that the tenant is
limited in her answer to this petition to those issues raised
therein.
Regarding the tenant's allegation that her vacancy lease
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contained no clause specifically informing her of a pending MCI
application, the owner alleges that the tenant had been give a
copy of the Rent Stabilization Rider but "she refused to
acknowledge its receipt." In addition, the owner notes that
paragraph 31 of her lease obligates both parties herein to be
bound by determinations made by the Division of Housing and
Community Renewal (DHCR) and in particular requires the tenant to
pay any rent increase "in the manner set by the DHCR."
Finally the owner states its willingness to waive those portions
of the MCI increase which were not for windows if the tenant's
original "preferential" rent of $510.00 is deemed to be the
lawful rent.
The Commissioner is of the opinion that this petition should be
granted in part.
At the outset the Commissioner hereby modifies the
Administrator's order to show the owner as A & A Realty Company
c/o Ralph Akselrad and the prior tenant as Molly Weitzman.
Furthermore, the Commissioner hereby finds that the fact that the
Administrator's order was unsigned does not invalidate the order.
The Administrator's log sheet clearly shows that the Order was
issued as intended, i.e., with a base rent of $278.40 and an
increase for improvements limited to $151.52.
The Commissioner notes that Division policy allows an answer to
be considered even if not received within the time limit. Hence,
the tenant's answer to this petition will be considered.
However, the owner is correct that the tenant's answer must be
limited to the issues raised in the owner's petition.
Most importantly, her request for a hearing to challenge the
owner's costs for various improvements could only have been
raised in a timely petition of her own. Similarly, the tenant's
contention that the floor scraping should have been excluded by
the Administrator could only have been raised in a timely
petition. Nevertheless, the Commissioner notes that the owner is
correct that in fact the Administrator did not include that cost
in computing the rent increase for improvements.
It remains only to discuss the heart of the owner's appeal and
the tenant's reply thereto, i.e., whether the Administrator
should have granted the owner a rent increase for the cost of the
thermal windows.
Since the owner had applied for and received a building-wide MCI
increase which included the cost of those windows, the
Administrator was clearly correct not to grant the own r a one-
fortieth increase for the same improvement. Furthermore, the
record indicates that the windows were installed before the
vacancy prior to the complaining tenant's occupancy.
Accordingly, no increase for an improvement to an individual
apartment could be granted without the proof of the consent
thereto by the tenant in occupancy at the time of the
improvement.
Therefore, the owner can only get an increase for the windows as
part of the MCI increase granted on June 16, 1986 in order number
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Z-KCS 000490-OM, which also included increases for doors,
pointing and waterproofing. This order granted a 7.69% increase
for stabilized apartments, to be computed from the March, 1985
rent for each such apartment.
Thus, the tenant is correct that the 7.69% increase must be
computed from $278.40 rather than from $475.86, the lawful rent
established by the Administrator for the complaining tenant's
June 1, 1985 two year vacancy lease.
Furthermore, Section 2522.5(d)(4) of the Code requires that when
an MCI application is pending at the commencement of a vacancy
lease, the owner may not collect such increase until the
expiration of the vacancy lease unless the lease contains a
clause stating "that such application is pending before the DHCR
and the basis for the adjustment, and that the increase which is
the subject of such appliction, if granted, may be effective
during the term of the lease" This section codified long-standing
policy of the New York City Conciliation and Appeals Board (CAB),
the agency formerly charged with the enforcing the Rent
Stabilization Law.
A general clause allowing a rent increase during the term of the
lease does not satisfy this requirement. Accord: Administrative
Review Docket Number ART 02715-Q, et al.
Accordingly, since the Administrator's order computed overcharges
only through May 31, 1987, the expiration date of the tenant's
vacancy lease, the Administrator was correct not to have included
the MCI increase in the lawful rent for that period.
THEREFORE, in accordance with the Rent Stabilization Law and
Code, it is
ORDERED, that this petition be, and the same hereby is, granted
in part and the Rent Administrator's order be, and the same
hereby is, modified by correcting the names of the owner and the
prior tenant stated therein.
ISSUED:
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ELLIOT SANDER
Deputy Commissioner
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