BI 210210-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.: BI 210210-RO
DISTRICT RENT OFFICE
Samuel Mandel (401 76th Street DOCKET NO.: K-3102339-R
Corporation), CDR 31033
TENANT: Margie Ambrosino
PETITIONER
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ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
On September 16, 1987 the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
August 12, 1987 by the District Rent Administrator, 10 Columbus
Circle, New York, New York concerning the housing accommodations
known as 401 76th Street, Brooklyn, New York, Apartment No. 4D
wherein the Rent Administrator determined that the owner had
overcharged the tenant.
The issue in this appeal is whether the District Rent
Administrator's order was warranted.
The applicable sections of the Law are Section 26-516 of the Rent
Stabilization Law and Section 2526.1(a) of the current Rent
Stabilization Code.
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, in which she
stated that she had commenced occupancy of Apartment 4D on February
15, 1984 at a rent of $478.00 per month.
The owner was served with a copy of the complaint and was requested
to submit rent records to prove the lawfulness of the rent being
charged. In answer to the complaint, the owner submitted leases
from October 1, 1979, which he contended were all the leases in his
possession, as well as submitting a list of tenants' names, lease
terms and rents since June 30, 1974.
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In an order issued on August 12, 1987 the Administrator utilized
DHCR default procedures to set the tenant's lawful stabilization
rent, and determined an overcharge of $4,149.01 as of August 31,
1987, including excess security of $566.20.
In this petition, the owner contends in substance that he was under
a belief that the tenant had withdrawn her complaint in September,
1984; that he did not hear from the DHCR until receiving a Final
Notice of Pending Default 18 months after that, requesting all
leases from the base date; that he indeed submitted all the leases
in his possession, but did not submit rent ledgers since they were
not requested; and that the documents now submitted should be
considered for the purpose of establishing a complete rental
history. With his petition the owner has enclosed rent ledgers
from 1973.
In answer, the tenant asserts in substance that she never said that
she would withdraw her complaint, that the Administrator's order
was warranted, that the owner knew what was required, and that she
doubts that a new stove was installed in 1981.
The Commissioner is of the opinion that this petition should be
granted.
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
BI 210210-RO
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), in
cases involving rent overcharge complaints filed prior to April 1,
1984.
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.
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 present 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. The
owner has submitted rent records back to before April 1, 1980. The
rent ledgers concerning the lease commencing October 1,1979 confirm
the information listed by the owner in his submission to the
Administrator. The Commissioner has used the rent in that lease as
the base date rent, and has calculated the lawful stabilization
rents and the amounts of overcharge. They are set forth on an
amended rent calculation chart attached hereto and made a part
hereof.
Regarding the tenant's contention that no new stove was in stalled,
she has submitted no evidence to controvert the November 15, 1981
invoice submitted by the owner for the purchase of a stove for the
subject apartment.
The owner is cautioned to adjust the rent, in leases after those
considered in this order, to amounts no greater than that
determined by this order plus any lawful increases, and to register
BI 210210-RO
any adjusted rent, with this order being given as the reason for
the adjustment.
If there are arrears due to the owner as a result of the present
determination, the owner is directed to allow the tenant to pay off
the arrears in twenty four equal monthly installments. Should the
tenant vacate after the issuance of this order, or have previously
vacated, said arrears shall be payable immediately.
THEREFORE, in accordance with the Rent Stabilization Law and Code,
it is
ORDERED, that this Petition be, and the same hereby is, granted and
that the Rent Administrator's order be, and the same hereby is,
modified in accordance with this Order and Opinion. The lawful
stabilization rents and the amount of overcharge are established on
the attached chart, which is fully made a part of this order. The
total overcharge is $0.66 as of August 31, 1987, including excess
security of $0.02. The lawful
stabilization rent is $552.28 per month in the lease from
March 1, 1987 to February 28, 1989.
ISSUED:
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner
BI 210210-RO
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