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. BG210137RO
: DISTRICT RENT OFFICE
Kingswood Management, DOCKET NO. K3102877R
TENANT: Arthur Edwards
ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
On July 27, 1987, the above-named owner filed a Petition for
Administrative Review against an order issued on July 14, 1986 by the
Rent Administrator concerning the housing accommodations known as
441 Brooklyn Avenue, Brooklyn, New York, Apartment No. 1F wherein the
Rent Administrator determined that the owner was in default due to its
failure to submit the requisite rental history. The petition is deemed
timely filed since the July 14, 1986 Rent Administrator's order was not
mailed to the correct owner.
The Commissioner notes that the July 14, 1986 Rent Administrator's order
was subsequently revoked and superceded by an amended Rent
Administrator's order, issued November 19, 1987 under the same Docket
Number (K3102877R), in order that Brooklyn Management Co. be included as
a party in the proceeding before the Rent Administrator. However, since
the Administrator's findings in the amended order remain pertinent to
the issues raised by the petitioner, the Commissioner has determined
that said amended Rent Administrator's order be considered for appeal
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 finding the
owner in default was warranted.
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 on March 29, 1984
of a rent overcharge complaint by the tenant.
In answer to the tenant's complaint, the owner submitted rent records
dating back to at least April 1, 1980.
In Order Number K3102877R, the Rent Administrator determined that, due
to the owner's failure to submit the requisite rental history, the base
rent and subsequent lawful stabilization rents were based on the Section
42A default procedure, effecting a rent overcharge of $850.87, including
excess security and interest on that portion of the overcharge occurring
on and after April 1, 1984.
In this petition, the owner requests reversal of the Administrator's
order and contends in substance that, among other things, a complete
rental history was submitted as requested.
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
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
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.
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.
Given that 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. In the instant case, the
record contains a rental history going back to April 1, 1980. Since the
base rent for the subject apartment was properly established as the rent
charged on April 1, 1980 based on the requisite rental history supplied,
the Administrator's application of the Section 42A default procedure in
establishing the base rent was not warranted.
Furthermore, for the period April 1, 1980 through August 10, 1984 used
in the Administrator's calculations, there is no evidence that the
tenant paid any excess in rents lawfully allowed under the applicable
Therefore, the Administrator's order finding a rent overcharge must be
If the owner has already complied with the Rent Administrator's order
and there are arrears due to the owner as a result of the instant
determination, the tenant shall be permitted to pay off the arrears in
twelve equal monthly installments. Should the tenant vacate after the
issuance of this order or have already vacated, said arrears shall be
THEREFORE, in accordance with the Appellate Divisions ruling in JRD, it
ORDERED, that this petition for administrative review be, and the same
hereby is, granted, that the order of the Rent Administrator be, and the
same hereby is, revoked, and it is found that no rent overcharge
JOSEPH A. D'AGOSTA