BI 110307 RO
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. BI 110307 RO
: DRO DOCKET NO.Q-3119358-R
YELLOW MANOR REALTY CO. TENANT: HOWARD EHRLICH
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On September 19, 1986, the above-named petitioner-owner filed
a Petition for Administrative Review against an order issued on
September 11, 1986, by the Rent Administrator, 10 Columbus Circle,
New York, New York, concerning the housing accommodations known as
68-61 Yellowstone Blvd., Queens, New York, Apartment No. 710,
wherein the Rent Administrator determined that the owner had
overcharged the tenant.
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.
The owner was served with a copy of the complaint on October
31, 1984 and was requested to submit rent records from the base
date to prove the lawfulness of the rent being charged. No
response was submitted by the owner. On July 9, 1986, the owner
was served with a Final Notice of Pending Default directing it to
submit a complete rental history within twenty days of July 9,
1986. Again there is no record of any response from the owner.
In Order Number CDR 22,264, 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
$4109.22, and directed the owner to refund such overcharge to the
tenant as well as to reduce the rent.
In this petition, the owner contends in substance that it
submitted a complete rental history including copies of all leases
on August 20, 1986. No copy of such submission was submitted with
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the owner's petition.
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
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.
BI 110307 RO
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 record in this case indicates that the owner
did not submit any rental history in the proceeding before the
Rent Administrator nor on appeal. It is noted that the owner
claims to have made a submission on August 20, 1986. Even if this
were true, the submission would not have been made within the
twenty day time limit given the owner in the July 9, 1986 Final
Notice of Pending Default. Accordingly, the Rent Administrator's
order defaulting the owner and finding a rent overcharge was
Because this determination concerns lawful rents only through
March 14, 1982, the owner is cautioned to adjust subsequent rents
to an amount no greater than that determined by the Rent
Administrator's 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
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
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the same hereby is, denied, and, that the order of the Rent
Administrator be, and the same hereby is, affirmed. The total
amount of the rent overcharge through March 14, 1982 is $4109.22.