BJ 130273 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.: BJ 130273 RO
JANET SPAFFORD,
GRENADIER REALTY CORPORATION, DRO DOCKET NO.: Q 3122214 R
PETITIONER
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ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
On October 1, 1987 the above-named petitioner filed a Petition
for Administrative Review against an order issued on September 3,
1987 by the Rent Administrator, 10 Columbus Circle, New York, New
York, concerning housing accommodations known as Apartment 1 at
74-09 255th Street, Glen Oaks, New York, wherein the Rent
Administrator determined that the tenant had been overcharged.
The applicable sections of law are Section 26-516 of the Rent
Stabilization Law and Section 2526.1(a) of the 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 issues raised by the administrative appeal.
This proceeding was originally commenced by the filing of a rent
overcharge complaint by the tenant with the New York City
Conciliation and Appeals Board, one of the predecessor agencies
to the Division of Housing and Community Renewal (DHCR). The
tenant took occupancy pursuant to a lease commencing September 1,
1977 and expiring August 31, 1979 a monthly rent of $319.06.
The owner was served with a copy of the complaint and in response
submitted a rent history from May 16, 1977. The owner indicated
that it was submitting all rent records it had available.
In Order Number CDR 31,294, 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
$5,864.72 and directed the owner to refund such overcharge to the
tenant as well as to reduce the rent.
In its petition, the petitioner contends that the Administrator
failed to consider the lease dated April 16, 1977 commencing May
16, 1977. The petitioner also states that Poonsuk S. Wejman is
the owner of the subject premises, and Grenadier Realty
BJ 130273 RO
Corporation is the managing agent.
In answer to the owner's petition, the tenant asserts that he has
requested calculation of the rental history from 1968 and that
recalculating the rental history on the basis of the 1977 lease
would violate the tenant's right to a full rental history.
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) to date and to produce
such records to the DHCR upon demand.
Section 26-516 of 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
produce rent records for more than 4 years prior to the most
recent registration, and concomitantly, established a 4 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 right 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 4 years prior to April
1, 1984 of their 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. Mgt. v.
Eimicke, 148 A.D.2d 610, 539 N.Y.S.2d 667 (App. Div. 2d Dep't
1989), motion for leave to reargue or for leave to appeal to the
Court of Appeals denied (App. Div. 2d Dep't, 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 4 years of rent records.
Since the issuance of the decision in JRD, the Appellate
BJ 130273 RO
Division, First Department, in the case of Lavanant v. DHCR, 148
A.D. 2d 185, 544 N.Y.S.2d 331 (App. Div. 1st Dep't 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.
Accordingly, the Commissioner has examined the rent records for
the subject apartment from May 16, 1977 and has determined that
no rent overcharge occurred. The tenant's initial rent was
$319.06. It was increased by lawful guidelines amounts through
the tenant's September 1, 1985 lease. Therefore, the Rent
Administrator's order determining that the tenant had been
overcharged must be revoked.
If the owner has already complied with the Administrator's order
and there are arrears due to the owner as a result of the instant
determination, the tenant may pay off the arrears in twenty four
equal monthly installments. Should the tenant vacate after the
issuance of this order, said arrears shall be payable
immediately.
The Commissioner notes that for purposes of this proceeding the
managing agent Grenadier Realty Corporation is properly named as
the owner since Section 2520.6(i) of the Rent Stabilization Code
includes a managing agent in the definition of an owner.
THEREFORE, in accordance with the Appellate Division ruling in
JRD, it is
ORDERED, that this petition be, and the same hereby is, granted,
and the order of the Rent Administrator be, and the same hereby
is, revoked and it is found that no rent overcharge occured.
ISSUED:
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ELLIOT SANDER
Deputy Commissioner
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