ADM. REVIEW DOCKET NO.: BJ 410350 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 410350 RO
430 REALTY CORP. :
D.R.O. DOCKET NO.:
TC 077058-G
PETITIONER :
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ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On October 2, 1987, the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
August 28, 1987, by the Rent Administrator, 10 Columbus Circle,
New York, New York, concerning housing accommodations known as
apartment 14C, 430 East 86th Street, New York, NY, wherein the
District Rent Administrator determined that the tenant had been
overcharged.
The Commissioner notes that this proceeding was initiated
prior to April 1, 1984. Section 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, any reference in this order and opinion to
Sections of the Rent Stabilization Code is to the Code in effect
on April 30, 1987, and this proceeding is being determined in
accordance therewith.
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 commenced by the filing of a rent
overcharge complaint by the tenant on September 30, 1983 with the
N.Y.C. Conciliation and Appeals Board, one of the predecessor
agencies to the DHCR. The tenant took occupancy pursuant to a
two-year lease commencing on May 1, 1980 and expiring on April 30,
1982, at a monthly rent of $2100.00. That lease, on May 1,1981,
was renegotiated to expire on December 31, 1982, at a monthly rent
of $1800.00. In her complaint, the tenant stated that upon
renegotiating the $1,800.00 lease, she signed a waiver of any
claim for prior leases. The tenant further alleged that the prior
tenant, who took occupancy in 1978 as the first stabilized tenant
ADM. REVIEW DOCKET NO.: BJ 410350 RO
following decontrol, paid $1,400.00 per month rent for the
apartment.
The owner was served with a copy of the complaint and was
requested to submit rent records from the base date to prove the
lawfulness of the rent being charged. The owner did not respond.
In Order Number CDR 29,024, issued February 17, 1987, the
Administrator found an overcharge of $852.00. On February 19,
1987, the tenant requested that the case be reopened, because the
Administrator's calculations were based on erroneous figures.
Upon reconsideration, on May 11, 1987 the Administrator revoked
the order based on an irregularity in a vital matter, and reopened
the case to establish the legal stabilized rent.
The owner was, on May 14, 1987, again afforded an opportunity
to respond, and on June 15, 1987 was sent a Final Notice of
Pending Default, which it did not answer.
In Order Number CDR 29,024, as amended, issued on August 28,
1987, the Administrator found that the owner had failed to submit
a complete rental history, and determined that the legal regulated
rent would be established under Section 42A of the Rent
Stabilization Code. The Administrator established the complaining
tenant's initial rent as $1400.00, the last rent paid by the prior
tenant, and established the lawful stabilized rent as of January
1, 1986 as $1,909.76 per month, in accordance with the default
procedure. Total overcharges in the amount of $41,390.62,
including excess security and treble damages on overcharges
collected on or after April 1, 1984, were found.
In its petition, the owner claims that the tenant had waived
any claim for prior leases when she and her attorney negotiated
the lease beginning May 1, 1981; that the landlord and tenant
established, by agreement, the tenant's initial legal rent; and
that no overcharge exists.
In answer to the owner's petition, the tenant asserts that
the owner has repeatedly attempted to avoid the requirements of
the Re t Stabilization Law and Code by imposing as a pre-
condition for acceptance that the tenant was required to accept
the lease as a secondary lease only, falsely stating that tenant's
weekend address was the tenant's primary residence. The tenant
further asserts that the negotiated waiver of benefits was
unenforceable. The tenant also contends that the owner's failure
to register barred collection of any increase after April 1, 1984.
Additionally, the tenant requests reimbursement of attorney's fees
for her answer to the petition.
The Commissioner is of the opinion that this petition should
be denied.
Section 42A of the 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.
ADM. REVIEW DOCKET NO.: BJ 410350 RO
Accordingly, in the absence of a full rental history, the
Commissioner finds that the application of the 42A default
procedure was proper.
Regarding the petitioner's contention that the initial legal
rent and a waiver of claims for the prior lease were established
by negotiated settlement: Section 2520.13 of the current Rent
Stabilization Code states, in pertinent part: An agreement by the
tenant to waive the benefit of any provision of the Rent
Stabilization Law or this Code is void; provided, however, that
based upon a negotiated settlement between the parties and with
the approval of the DHCR, or a court of competent jurisdiction
where a tenant is represented by counsel, a tenant may withdraw,
with prejudice, any complaint pending before the DHCR.
The Commissioner finds that the agreement entered into by the
owner and the tenant was not entered into with the approval of a
court of competent jurisdiction and therefore does not constitute
a waiver of the tenant's rights under the Rent Stabilization Code.
The petitioner cites the case of Matter of Silgo 22nd
Associates, Docket No. ARL 08579-L, as supporting its negotiated
settlement. That case is distinguishable from the instant
proceeding in that the withdrawal and settlement arrived at was a
so-ordered stipulation in Civil Court, and thus fit the narrow
exception drawn in the current Rent Stabilization Code, Section
2520.13.
Concerning the allegation of the tenant that the owner's
failure to register barred collection of any increase after April
1, 1984: the Commissioner finds that in the absence of a tenant's
petition for administrative review, this may not be raised in
answer to the owner's PAR. The Commissioner notes that the owner
registered the premises in 1986.
With regard to the tenant's request for attorney's fees
for her PAR answer, the Commissioner notes that Section 2526.1(d)
of the Rent Stabilization Code provides for the award of
attorney's fees in the proceeding before the Administrator. DHCR
generally does not award attorney fees incurred at the appeals
level. The Commissioner finds no reason to deviate from that rule
in the instant case.
The order of the Division of Housing and Community Renewal
awarding penalties may, upon the expiration of the period in which
the owner may institute a proceeding pursuant to Artic e Seventy-
Eight of the Civil Practice Law and Rules, be filed and enforced
by a tenant in the same manner as a judgment or not in excess of
twenty percent thereof per month 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 be and the same hereby is denied
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and the Administrator's order be and the same hereby is affirmed.
ISSUED:
ELLIOT SANDER
Deputy Commissioner
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