Docket Number: BC-410147-RT
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.: BC 410147-RT
:
REGINA PAIDAS, DRO DOCKET NO.: CDR# 28,861
80406-G
PETITIONER : Other Party:
------------------------------------X Hudson Associates, Owner
ORDER AND OPINION REMANDING PROCEEDING ON APPEAL
On March 17, 1987, the above-named petitioner-tenant filed a
Petition for Administrative Review against an order issued on
February 10, 1987, by the Rent Administrator at 10 Columbus Circle,
New York, New York, concerning the housing accommodations known as
apartment 13 at 104 West 96th Street, New York, New York, wherein
the Administrator established the stabilized rent and dismissed the
tenant's rent overcharge complaint.
The Commissioner notes that this proceeding was initiated prior to
April 1, 1984. Sections 2526.1(a)(4) and 2521.1(d) of the Rent
Stabilization Code (effective May 1, 1987) governing rent
overcharge and fair market rent proceedings provide that
determination of these matters be based upon the law or code
provisions in effect on March 31, 1984. Therefore, unless
otherwise indicated, reference to Sections of the Rent
Stabilization Code (Code) contained herein are to the Code in
effect on April 30, 1987.
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 in the administrative appeal.
This proceeding was originally commenced in October of 1983, by the
filing of a complaint of rent overcharge with the New York City
Conciliation and Appeals Board (CAB, the agency formerly charged
with enforcing the Rent Stabilization Law) by the tenant. The
tenant alleged that she had taken occupancy under a one year lease
(May 1, 1983 to April 30, 1984) at a monthly rental of $885.00. The
tenant further alleged that prior to her occupancy the apartment had
been subject to rent control and that the Maximum Base Rent (MBR)
for 1972-73 had been $120.67. The tenant subsequently submitted
what appears to be a redacted copy of a February 7, 1972 order of
Maximum Base Rent. It shows a tenant named Gordon residing at the
subject apartment and it states that the MBR for 1972-73 was
$120.67. The tenant also made an allegation as to certain
improvements installed in the apartment, but the allegation is
somewhat vague as to when the improvements were installed and
whether in fact she was confirming their installation. The tenant
stated that "To the best of my knowledge the following renovations
were being made:". The tenant then listed the following items:
"Kitchen: new sink Bathroom: new sink
Docket Number: BC-410147-RT
new electric stove new bathroom
new refrigerator cabinets (2)
new cabinet new door
new linoleum floor
Rest of Apartment: new wooden floors (nailed on top
of old one
two new doors
some walls being sheet rocked"
In its answer to the complaint, the owner alleged that it had
purchased the subject building in November of 1982; that prior to
the tenant's occupancy, the apartment had been occupied by the
superintendent from 1976 to 1983; that the superintendent paid no
rent; and that prior to the superintendent's occupancy, the
apartment had been rent controlled. The owner submitted a copy of a
Notice of Increase In 1976-1977 Maximum Base Rent and Maximum
Collectible Rent Computation (Short Form). It was addressed to a
tenant named Gordon concerning the subject apartment and showed a
MBR of $159.73. The owner further alleged that when the
superintendent vacated the apartment it was totally renovated. The
owner submitted an unsigned, two page, inventory of work under the
letterhead of a Monte's Construction Co. This document does not
state where the described work was done (neither as to the address
of the building nor as to the apartment). This document (the
Monte's document) indicates a total cost of $14,500.00, but the
total of the separately listed items therein adds up to only
$13,950.00. The owner also submitted what appears to be an invoice
from a Quero Construction Company for electrical work at the subject
apartment at a total cost of $1,000.00. The owner also submitted
copies of six checks (the front only). Four name Monte's
Construction as payee and total $14,500.00. None of the Monte's
checks bears any notation as to what the checks were given in
payment of. The other two checks total $1,000.00. One names Quero
($600.00) as payee and the other is payable to a David Chirley
($400.00) who appears to have signed the Quero invoice. Both of
these checks bear a notation as to "elec" at apartment 13. The
owner also submitted a list of hardware items totalling $47.19 and
invoices for various miscellaneous amounts for hardware items.
In the appealed order, citing CAB Opinion Number 23,243, the
Administrator determined that the tenant's initial rent was the base
rent for calculating all future Guidelines increases and that the
owner had not collected any overcharges from the tenant through
January 31, 1987.
In her Petition, the tenant contends, in substance, that the
Administrator erred as follows:
Docket Number: BC-410147-RT
1. The Administrator's order cited and relied upon
CAB Opinion Number 23,243. That opinion was misapplied
to the facts in this case since, here, according to the
owner's documents, the apartment was subject to rent
control after June 30, 1974 and was occupied by the
superintendent, on a temporary basis, starting sometime
in 1976 after having been subject to rent control.
2. The occupancy of the subject apartment by the
superintendent, under all of the facts herein, does not
fit within the definition of an exempt occupancy under
Section 2(g)(4) of the Code in effect on April 30, 1987.
The subject apartment is on the third floor. The
logical location for a superintendent's apartment is
on the first floor or the basement level. Within a few
days of Hudson Associates' acquisition of the subject
building in November of 1982, the superintendent was
discharged and required to vacate the subject apartment.
3. According to the Code in effect on April 30,
1987, all that the owner was entitled to in terms of an
increase, when the tenant took occupancy, was 15% of the
previous rent plus 1/40th of the renovation costs.
4. Rents for identical non-renovated apartments in
this building on August 21, 1983 ranged from $196.51 to
$295.13 (Apts. 3, 8, 23 and 28) as evidenced by the
attached copy of the owner's application to increase
rents based on the installation of Major Capital
Improvements (MCIs).
Although afforded the opportunity, the owner has not interposed an
answer to the tenant's petition.
The Commissioner is of the opinion that this matter should be
remanded to the Administrator for further, appropriate processing as
a Fair Market Rent Appeal (FMRA) and, in conjunction therewith, a
review of the owner's claim to a rent increase based on the alleged
improvements installed in the apartment.
The Commissioner finds that it is undisputed that the tenant is the
first stabilized tenant to occupy the subject apartment after it was
vacancy decontrolled. Moreover, the Commissioner notes that there
is no indication in this record that the owner ever served the
tenant with a Notice of Initial Legal Regulated Rent (also known as
a DC-2 form), although the Administrator requested the submission of
such proof.
The tenant has raised some questions concerning the veracity of the
owner's allegations concerning the superintendent's occupancy of the
subject apartment. However, the Commissioner finds that the tenant
has submitted no evidence to rebut the owner's allegations.
Docket Number: BC-410147-RT
Moreover, the Commissioner finds that if the subject apartment had
in fact been occupied by the superintendent and, therefore, been
exempt from regulation between the vacancy decontrol of the
apartment in 1976 and the tenant's occupancy of it, commencing in
1983, the tenant would still be entitled to file a FMRA.
Section 25A (3) of the Code in effect on April 30, 1987 reads in
pertinent part as follows:
A. An application to adjust the Initial Legal
Regulated Rent on the ground that it exceeds the Fair
Market Rent for the dwelling unit may be filed with
the CAB by the tenant of.
* * * *
(3) a dwelling unit which was subject to
the City Rent Law on June 30, 1974 and was vacated
thereafter, provided however, that this right is
limited to the first tenant in occupancy after the
first vacancy occurring subsequent to June 30,
1974....
The Commissioner finds that to deny the tenant the right to a FMRA
simply because there was a period, between vacancy decontrol and the
tenant's occupancy as the first stabilized tenant, during which the
apartment may have been exempt from regulation would be contrary to
the language and intent of Section 25A (3) of the Code in effect on
April 30, 1987.
The Commissioner notes that the superintendent may not be deemed a
tenant within the meaning of Section 25A (3), as it is clear that as
used therein, the term tenant meant a rent stabilized tenant.
Moreover, according to the owner, the superintendent paid no rent.
The Commissioner finds that CAB Opinion Number 23,243 is not
controlling herein since it did not deal with the right of the
tenant therein to a FMRA. It held that a tenant who first took
occupancy on December 15, 1971 as the superintendent and so resided
in her apartment rent free, until November 1, 1977, when she became
a rent stabilized tenant of the apartment, had to use the first rent
paid under her initial stabilized lease, as the base rent for
computing future Guidelines increases. Although the question of
that tenant's right to a FMRA was not discussed, the Commissioner
notes that, based on the facts as set forth in that Opinion, that
tenant may very well not have been entitled to a FMRA, as it appears
that that apartment was not vacated between January 1, 1974 and June
30, 1974 (as required by Section 25A (1) and (2)) and it appears
that said apartment was not a dwelling unit subject to rent control
on June 30, 1974 (as required by Section 25A (3)).
THEREFORE, pursuant to the Rent Stabilization Law and Code, it is
Docket Number: BC-410147-RT
ORDERED, that this petition be, and the same hereby is granted to
the extent of remanding the proceeding to the Rent Administrator
for processing in accordance with this order and opinion.
ISSUED:
ELLIOT SANDER
Deputy Commissioner
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