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.: BB-110588-RT
: BB-130485-RT; BB-130584-RT
BB-130585-RT; BB-130586-RT
VARIOUS TENANTS, BB-130587-RT; BB-130689-RT
PETITIONER : BB-130690-RT; BB-130795-RT
------------------------------------X BC-110119-RT; BC-130059-RT
BC-130185-RT
DISTRICT RENT ADMINISTRATOR'S
DOCKET NO.: ZQCS 000892-OM
ORDER AND OPINION DENYING PETITIONS FOR ADMINISTRATIVE REVIEW
The above-named petitioner-tenants timely filed administrative appeals
against an order issued on January 28, 1987 by the District Rent
Administrator (Gertz Plaza, Jamaica, New York) concerning the housing
accommodations known as 110-07 73rd Road, Queens, New York, various
apartments, wherein the Administrator granted major capital improvement
(MCI) rent increases for the controlled and stabilized apartments in the
subject premises based on the installation of new controllers and
selectors in the elevators at the premises.
On appeal, the petitioner-tenants state, in substance, that (A) The
subject building was converted to a cooperative in 1983 and the landlord,
as owner of the unsold shares of the cooperative corporation's stock, has
no standing to seek an increase in petitioners' rent; (B) The work done
herein constituted repairs necessary to provide required services; and (C)
The work was done at the direction f and for the benefit of tenant-
shareholders. In support of their contentions, the petitioners cited the
cases of Grand Leasing Company v. The New York State Division of Housing
and Community Renewal, 509 NYS 2d 768 and Forest Gardens,etc v. Office of
Rent Control, 81 Misc. 2d 233, approved by the Court of Appeals in 41 NY2d
963.
In response to the tenants' petition, the owner filed an answer stating,
in substance, that (I) The owner of unsold shares is legally allowed to
collect an MCI rent increase; (II) The Grand Leasing case cited by the
tenants applies to alternative hardship rent increase applications; (III)
The Administrative Code of New York City states that MCI increases can be
granted to owners, such term not being limited to owners of the building;
and (IV) The DHCR has always granted MCI increases to owners of unsold
shares, who have all the obligations of ownership.
After a careful consideration of the entire evidence of record the
Commissioner is of the opinion that the administrative appeals should be
denied.
DOCKET NUMBER: BB-110588-RT; etal
At the outset, the Commissioner notes that the Administrator's order
herein has previously been affirmed in a decision issued on July 5, 1990
under Docket No. BC-130002-RT. In that decision the Commissioner has
already determined that the work herein qualifies as an MCI and is not
regarded as ordinary repair and maintenance work. In addition, the
Commissioner had stated that the Grand Leasing case is not applicable to
an MCI rent increase application.
The Commissioner further notes that the Court in the Grand Leasing case
specifically stated that the Administrative Code of the City of New York
does not require MCI applicants to be owners of buildings, but merely
owners. In addition, the other case cited on these appeals is not
relevant to the issues herein and does not support the petitioners'
contentions. It should be noted that the Forest Gardens citation above
was incorrectly noted. The correct citation is: Kew Gardens Hills Housing
Associates (Garage Units) v. Office of Rent Control.
Furthermore, the Commissioner notes that normally, if a cooperative
corporation is eligible to file for an MCI increase, the application must
be filed by the managing agent of the corporation on behalf of the
corporation and all proprietary lessees, including the sponsor. The
requirement exists to avoid multiple applications for the same MCI.
However, in the instant case, where the record does not disclose a
possibility of future timely filed MCI applications by subsequent
investor-purchasers of one of the rent regulated apartments, the purpose
behind the requirement was satisfied and there is no justification for
disturbing the Administrator's findings below.
Finally, the Commissioner notes that the MCI increases granted for the
rent stabilized and rent controlled tenants herein were computed in
proportion to the benefits received by these tenants vis-a-vis the other
residents of the building. Thus, the increase for the rent controlled
apartments was calculated according to the total number of rooms in the
premises and the computation of the increase for the rent stabilized
apartments took into account the ratio of the stabilized apartments to the
total number of apartments at the premises.
On the basis of the entire evidence of record, it is found that the
Administrator's order is correct and should be affirmed.
THEREFORE, in accordance with the applicable provisions of the Rent
Stabilization Law and Code, the Rent and Eviction Regulations for the City
of New York, and Operational Bulletin 84-1, it is
ORDERED, that the administrative appeals be, and the same hereby are
denied; and that the Administrator's order be, and the same hereby is
affirmed.
ISSUED:
JOSEPH A. D'AGOSTA
Deputy Commissioner
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