CA410127RT
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
APPEALS OF DOCKET NO. CA410127RT
DC410019RT
Lois Satler, : DISTRICT RENT OFFICE
DOCKET NO. AL410012RP
PETITIONER :
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ORDER AND OPINION DENYING PETITIONS FOR ADMINISTRATIVE REVIEW
On February 6, 1988, the above-named tenant timely refiled a petition
for administrative review of a District Rent Administrator's order
issued on November 19, 1987 concerning the housing accommodations known
as 245 East 35th Street, New York, New York, Apartment No. 4C, wherein
the Rent Administrator determined that the owners had not overcharged
the tenant.
A supplemental submission filed by the tenant was received by the
Division of Housing and Community Renewal (DHCR) on March 2, 1989. Due
to a clerical error this supplemental submission was assigned a new
Docket No. DC410019RT. Accordingly, the Commissioner is consolidating
these two cases, and this order and opinion shall be dispositive of
both.
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 appeals.
This proceeding was originally commenced on October 7, 1983 by the
filing of an overcharge complaint with the New York City Conciliation
and Appeals Board (CAB), the agency formerly charged with enforcing the
Rent Stabilization Law, under Docket No. TC077130G. In the complaint
the tenant stated that she took occupancy of the subject apartment on
October 15, 1975 and suspected she was being overcharge. The tenant
noted that she had not received a rental history of the subject
apartment. The owner named in this complaint was Sulzberger-Rolfe, Inc.
In its answer to the tenant's overcharge complaint, Sulzberger-Rolfe
asserted that no overcharges had occurred, but acknowledged that it had
no leases in its possession prior to the complainant-tenant's vacancy
lease beginning October 15, 1975.
In the Rent Administrator's order under Docket No. TC077130G issued on
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December 11, 1985 the Administrator determined that the owner had failed
to provide DHCR with a complete rental history. Accordingly, the
Administrator determined the lawful stabilization rent and the
overcharges by employing the court-approved default method. The total
overcharges were computed to be $20,775.29 through December 31, 1985.
This order named Avenue Associates as the prior owner and Townsley
Associates, c/o Sulzberger-Rolfe, Inc. as the current owner.
The prior owner, Avenue Associates, filed a petition for administrative
review (Docket No. ARL07204L) of the order issued on December 11, 1985
alleging that it had not been served by DHCR with any notices in the
original proceeding and therefore had been denied due process.
The tenant's answer to the prior owner's petition for administrative
review alleged that Avenue Associates was "flagrantly lying," and
alleged that a connection existed between the prior owner and current
owner of the subject building.
On November 28, 1986, the Commissioner under Docket No. ARL07204L issued
an order and opinion finding that Avenue Associates had been denied due
process in the original proceeding and accordingly, remanded the case to
the Administrator for further processing. The remanded case was
assigned Docket No. AL410012RP and is the case here under review.
In the proceeding before the Administrator under Docket No. AL410012RP
the tenant alleged that she had been advised by a CAB employee that
Avenue Associates had in fact been served in the original proceeding.
Further, she alleged that she had filed a second complaint of overcharge
with the CAB on October 13, 1983 in which she named Avenue Associates as
the owner, and therefore the tenant concluded that Avenue Associates had
been served.
Avenue Associates reiterated the due process allegations made in its
petition for administrative review Docket No. ARL07204L before the
Administrator. Namely, Avenue Associates asserted that it had sold the
subject building in 1981 and had moved from the address listed in the
original order under Docket No. TC77130G. Further, in addressing the
merits of the case, the prior owner submitted two leases which completed
the rental history.
In the order here under review, the Administrator determined that a
complete rental history had now been supplied and that the owners had
not overcharged the tenant.
In her petitions for administrative review, the tenant reasserts, among
other things, that the prior owner, Avenue Associates, was in fact
served and should not have been given a second opportunity to contest
her original complaint. In the alternative, the tenant asserts that the
previously-defaulted current owner, Townsley Associates, filed no
petition for administrative review of the Administrator's original order
under Docket No. TC77130G and therefore should not benefit from the
reprocessing of this case due to the filing of a petition for
administrative review by the prior owner. Further, the tenant alleges
that the leases which the owners produced to complete the rental history
were fraudulent, and she alleges that a collusive relationship existed
between the current owner and the prior owner. The tenant submits a
variety of documents in an effort to bolster her claims of fraud and
collusion.
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In their answers to the petitions for administrative review, the owners
urge that the Administrator's order under Docket No. AL410012RP be
affirmed. Among other things, the owners vigorously refute the tenant's
allegations of fraud and collusion.
Subsequently, the case was referred to the Hearings Section for a
hearing on the issues of the whether the leases submitted to complete
the rental history were valid and whether the owners acted in collusion.
Prior to the commencement of the hearing, the parties were given access
to the entire file and various memoranda as well.
The hearing began before Paul K. Fuller, Administrative Law Judge, on
May 14, 1992 at which time all parties appeared with counsel and
concluded on June 24, 1992 when the owners again appeared with counsel
and the tenant appeared pro se.
The tenant had specifically challenged the lease entered into between
the prior owner and tenant Ms. Novas-Calvo on March 7, 1974 and the
lease of September 13, 1974 between the prior owner and tenant Maureen
O'Connell.
The tenant alleged and testified that in August of 1975 she was informed
by either a superintendent or a doorman that the subject unit had been
vacant for a long time. The tenant stated that Ms. Novas lived in an
apartment on 72nd Street. However, she acknowledge that Ms. Novas told
her that for several months she had lived elsewhere but could not recall
when or what building. Ms. Novas also told the tenant that while she
had not signed the lease perhaps her husband or daughter had signed the
lease. The tenant also testified that she had a conversation with
Maureen O'Connell but that Ms. O'Connell could not recall anything
probative.
To substantiate her allegations regarding the legitimacy of the leases
between the prior owner and the prior tenants, on which the tenant has
the burden of proof, the tenant submitted, among other things,
affidavits of two independent tenants. The tenant also submitted
letters from Syracuse University and the Town of DeWitt by which
documents she sought to establish the falsity of the Novas Calvo
apartment lease application and thus the lease.
Avenue Associates produced the original leases, apartment lease
applications and other documents contained in their records pertaining
to these two rentals. The Administrative Law Judge found that all of
the documents appeared regular on their face and contained no obvious
alterations with the single exception of the v and the o in Calvo, on
the lease, which the Administrative Law Judge determined to be
insignificant.
Like the complainant-tenant, the owner's witnesses had no personal
knowledge of the facts and circumstances surrounding the execution of
the two leases.
After a complete hearing in which the Administrative Law Judge heard
testimony from several witnesses and examined the large number of
documents submitted as evidence, the Administrative Law Judge found that
the tenant had failed to sustain her burden of proof regarding her claim
that the two leases which completed the rental history were not valid
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and that there was no evidence that the owners had acted in collusion or
in any way sought to manufacture or submit fraudulent evidence.
The Commissioner is of the opinion that these petitions for
administrative review should be denied.
The Commissioner is of the opinion that the issue of whether the prior
owner was denied due process need not be reconsidered in this
proceeding. That issue was fully considered by the Commissioner in
Docket No. ARL07204L wherein the Commissioner found that the prior owner
was in fact denied due process in the proceeding under Docket No.
TC077130G. The tenant has offered no evidence to warrant
reconsideration of this issue.
Even if the Commissioner were to reconsider this issue, the evidence in
the record would confirm the prior finding of a lack of due process.
The DHCR case record under Docket No. TC077130G gives no indication that
any notice was sent to Avenue Associates. There is no independent
evidence to corroborate the tenant's claim that the prior owner was
served or given an opportunity to participate in the original
proceeding.
Regarding the tenant's claim that the current owner, Townsley
Associates, filed no petition for administrative review and,
accordingly, the default finding should be affirmed as against Townsley
Associates, the Commissioner is of the opinion that this argument is
without merit. Proceedings before DHCR are a single entity and are not
severed between owners. The fact that the current owner may receive a
benefit despite being less than diligent in defending itself does not
change this rule. In fact, in the more common situations, DHCR holds a
current owner liable for errors made by a prior owner. Similarly, the
current owner can derive a benefit from the prior owner's correction of
an error.
With regard to the merits of the case, the Commissioner finds that it is
appropriate to adopt the findings of the Administrative Law Judge that
the tenant failed to sustain her burden of proof regarding her
allegation of fraudulent leases and that there was no evidence of
collusion between the owners or of the manufacture or submission of
fraudulent evidence by the owners. The Administrative Law Judge found
that the documentation submitted by the tenant was either inconclusive
or non-probative, and that the tenant's own testimony, in fact, lent
credence to the validity and legitimacy of the leases. Accordingly, the
Commissioner finds that the record contains a complete, valid lease
history which indicates that the owners did not overcharge the tenant.
THEREFORE, in accordance with the Rent Stabilization Law and Code, it is
ORDERED, that these petitions be, and the same hereby are, denied and
that the order of the Rent Administrator be, and the same hereby is,
affirmed.
ISSUED:
JOSEPH A. D'AGOSTA
Deputy Commissioner
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