DOC, NO.: CA 410130-RO
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.: CA 410130-RO
TUBA REALTY, : DRO ORDER NO.:
PETITIONER : CDR 32,073
------------------------------------X TENANT: DANA L. WILNER
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On January 12, 1988, the above named petitioner-owner filed a Petition
for Administrative Review against an order issued on December 8, 1987,
by the Rent Administrator, 10 Columbus Circle, New York, New York,
concerning housing accommodations known as Apartment Number 17, 435
East 12th Street, New York, New York, wherein the Rent Administrator
determined that there had been an overcharge and ordered a refund of
$16,995.15, including interest and excess security.
The Commissioner notes that this proceeding was initiated prior to
April 1, 1984. Sections 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, reference to
Sections of the Rent Stabilization Code (Code) contained herein are to
the Code in effect on April 30, 1987.
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.
The tenant commenced this proceeding on March 31, 1984 by filing an
overcharge complaint with the New York City Conciliation and Appeals
Board, predecessor of the DHCR, based in part on an alleged failure by
the owner to provide a complete rental history. The tenant alleged
having commenced occupancy on August 10, 1980 at a monthly rental of
DOC. NO.: CA 410130-RO
In an answer to the complaint received December 19, 1984, the owner
stated that the base rent for the apartment was April 11, 1975 when
the prior tenant took occupancy as the first stabilized tenant at
$172.00 per month. The owner submitted copies of leases for that
tenant from April 11, 1975 to an April 1, 1980 lease at $227.00 per
month. The owner stated that "it appears from the records we received
upon purchase that the prior owner followed applicable guidelines.
[We] certainly did."
All the leases submitted by the owner were for Apartment 18 rather
In Order Number CDR 32,073, herein under review, the Rent
Administrator stated that the owner had only submitted prior leases
for apartment 18 and was therefore in default with respect to subject
apartment 17. The lawful stabilized rent was established as $184.72
as of August 1, 1987.
In this petition, the owner contends that the Rent Administrator's
Order is incorrect and should be modified because the
"order ignores the fact that the prior tenant was
rent stabilized and that five (5) leases were
entered into with her. The first lease (copy
attached) was dated April 1, 1975 and was for a
rent of $172.00. It can therefore be assumed
that this was the first stabilized tenant and
that the unit was decontrolled sometime between
July 1, 1974 and April 1, 1975. (Emphasis
"The MBR records which are on file with DHCR
would substantiate this fact in probability.
These are records DHCR has in its possession and
it must consider them."
The leases submitted on appeal are the same Apartment 18 leases that
the Administrator explicitly rejected in the order under appeal. The
petitioner offers no justification for this discrepancy.
In answer to the petition, the tenant argues that the Administrator's
order should be upheld, because the owner has "ignored" the
Administrator by resubmitting the Apartment 18 leases. The tenant
contends the owner's failure to submit leases for apartment 17
indicates that the owner does not have them or that the leases would
demonstrate an even larger overcharge than found by the Administrator.
In addition, the tenant challenges that owner's statement that Lucy
Roman (the tenant in the Apartment 18 leases) was the first stabilized
DOC. NO.: CA 410130-RO
tenant, the tenant notes that she previously had submitted signed
statements from two prior tenants of Apartment 17, Brian Ruonavaara
and William Cleaver, stating that they had occupied Apartment 17 at
monthly rentals of $98.00 and $105.00 for the periods September, 1973
to October, 1975 and late 1975 to December, 1977, respectively,
contradicting both the rental history and the occupant history alleged
by the owner.
The Commissioner is of the opinion that this petition should be
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 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 produce rent records
for more than four years prior to the most recent registration, and
concomitantly, established a four 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 four 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,
DOC. NO.: CA 410130-RO
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 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 proceeding the subject dwelling unit is located
in the First Department, the Division will follow the Lavanant
decision which upheld the default procedure utilized in this case.
However, the Commissioner notes that since the owner has failed to
provide leases prior to August, 1980 it remains in default even under
the JRD standard.
In short, all the prior leases submitted by the owner were for the
wrong apartment. The Administrator's order stated this fact
explicitly. On appeal the owner again submits the same leases without
explanation. Accordingly, the owner was and remains in default. The
Commissioner notes that a search of the Rent Control records for the
apartment yielded the following: The most recent entry in the Rent
Control registration cards shows a 1968 maximum rent of $70.15. The
most recent Maximum Base Rent order, effective April 1, 1976 shows a
Maximum Collectible Rent and $93.69 and a Maximum Base Rent of
$100.72. The named tenants therein being different from the prior
tenants named by either the owner or the complaining tenant. There is
no Landlord's Report of Statutory Decontrol (R-42 form) or any other
indication of when the apartment first became stabilized. Thus,
nothing in the Division records supports the owner's contentions or
indicates any error in the Administrator's finding of default. The
burden is on the owner to prove the base date for stabilization. The
owner has clearly not met this burden.
DOC. NO.: CA 410130-RO
This order may, upon the expiration of the period in which the owner
may institute a proceeding pursuant to Article Seventy-Eight of the
Civil Practice Law and Rules, be filed and enforced by the 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
THEREFORE, in accordance with the Rent Stabilization Law and Code, it
ORDERED, that this petition be, and the same hereby is, denied and the
Rent Administrator's order be, and the same hereby is affirmed.