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. BL410247RO
: DRO DOCKET NO.61366G
TENANT: RANDY GOFF
PAN AM EQUITIES,INC.
ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW IN
On December 1, 1987, the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
October 27, 1987, by the Rent Administrator, 92-31 Union Hall
Street, Jamaica, New York, concerning the housing accommodations
known as 26 East 13th Street, New York, NY, apartment no. 3H,
wherein the Administrator determined that the owner had overcharged
The Commissioner notes that this proceeding was initiated
prior to April 1, l984. Sections 2526.1(a) 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, reference to sections of the Rent Stabilization Code
(Code) contained herein are to the Code in effect on April 30, 1987.
The issue in this appeal is whether the Rent Administrator's
order was warranted.
The applicable section of the Law is Section 42A of the former
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 of a
rent overcharge complaint by the tenant.
On March 13, 1984 the Attorney General of the State of New York
and the owner herein executed an Assurance of Discontinuance wherein
the owner agreed to review and to submit to the Attorney General
rental histories for rent stabilized apartments in the subject
premises (including the subject apartment herein) and to refund any
The owner was served with a copy of the tenant's rent
overcharge complaint and was directed to submit a complete rental
history for the subject apartment from the base date including
copies of all leases.
In response, the owner did not submit the required leases but
referenced the Assurance of Discontinuance of March 13, 1984 and
submitted a copy of said Assurance and a "Review of Rent History" in
which it listed the rental history for the subject apartment from
the base date.
In Order Number CDR 31,688, the Administrator determined that,
due to the owner's failure to submit a complete rental history, the
owner had collected a rent overcharge of $15,662.96, including
excess security and interest on that portion of the overcharge
occurring on or after April 1, l984 and directed the owner to refund
the overcharge to the tenant.
In this petition, the owner contends in substance that the DHCR
is bound by the Assurance of Discontinuance and therefore, the Rent
Administrator should not have issued the order appealed herein.
The owner further contends that the Administrator made a computing
error in the rent calculation chart, finding a three year lease
commencing October 1, 1985 at a rent of $725.19 instead of a two
year lease at $725.16. The owner submitted a copy of the two year
lease in support of its contention.
In a supplementary response, the owner contends that since the
subject building was formerly used for commercial purposes and was
not converted to residential use until after January 1, 1974, the
premises are not subject to the Rent Stabilization Law.
The tenant did not respond to the petition.
The Commissioner is of the opinion that this petition should be
granted in part.
Section 2(f)(8) of the former Rent Stabilization Code included
within its jurisdiction those dwelling units which "are subject to
regulation solely as a condition of receiving or continuing to
receive benefits pursuant to Section 51 - 2.5 of the Administrative
Code of the City of New York, as amended by Local Law 60.
Review of the record reveals that the owner herein was a
participant in the J51 program and that the instant apartment was
receiving J51 tax benefits for the time period at issue in the
Administrator's order. Accordingly, the Commissioner finds that the
subject apartment was within the jurisdiction of the Rent
Section 42A of the former Rent Stabilization Code provides in
pertinent part that the owner is required to retain all leases of a
dwelling unit from its base date and to produce them on demand for
as long as the dwelling remains subject to Rent Stabilization.
In the instant case, the owner did not submit the required
leases although given several opportunities to do so. The
Commissioner is of the opinion that the Assurance of Discontinuance
executed by the owner and the Attorney General does not preclude the
DHCR from determining a rent overcharge case brought before it. The
DHCR has primary jurisdiction to decide such cases. Moreover, in
the Assurance of Discontinuance, the lawful stabilization rent for
the subject apartment herein was not determined and it was noted on
p. 13 of such Assurance that "it is further agreed by respondent
that nothing in this Assurance of Discontinuance may be construed to
deprive any tenant of pursuing any right such tenant may have in a
court of competent jurisdiction or before the Conciliation and
Appeals Board or its successor agency". Accordingly, that part of
the Administrator's order was warranted.
With respect to the alleged error in the rent calculation
chart, the Commissioner notes that the owner did not submit any
evidence in the proceeding before the Administrator as to the rent
collected or the pertinent lease term which contradicts the tenant's
statement that there was a three year lease at a rent of $725.19.
However, because the owner was relying on the Assurance of
Discontinuance and did submit a copy of the lease on appeal and
because Rent Guidelines No. 17 does not provide for three year lease
terms, the Commissioner corrects the error and deducts $.03 per
month for the 25 months covered in the rent calculation chart or
$.75. Since the record indicates that the tenant has vacated the
premises, the excess security ($212.97) is also deducted from the
ordered refund. Accordingly, the owner is directed to refund to the
tenant an overcharge of $15,449.24.
The record indicates that the tenant has vacated the subject
apartment and that said apartment is exempt from rent stabilization
by reason of the expiration of J51 benefits.
Accordingly, a copy of this order is being sent to the tenant
at his last known address and to his attorney.
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, this order may be filed and enforced in the same
manner as a judgment. Where the tenant files this order as a
judgment, the County Clerk may add to the overcharge interest at the
rate payable on a judgment pursuant to Section 5004 of the Civil
Practice Law and Rules from the issuance date of the Rent
Administrastor's order to the issuance date of the Commissioner's
Therefore, in accordance with the provisions of the Rent
Stabilization Law and Code, it
Ordered that this petition be, and the same hereby is, granted
in part, and the Rent Administrator's order be, and the same hereby
is, modified in accordance with this order and opinion.
JOSEPH A. D'AGOSTA