DH410407RO, SJR7170
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. DH410407RO
VILLAGE REALTY : DRO DOCKET NO.ZL3110100RT
TENANT: JOEL ABREVAYA
PETITIONER :
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ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On August 25, 1989, the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on July
26, 1989, by the Rent Administrator, 92-31 Union Hall Street,
Jamaica, New York, concerning the housing accommodations known as
153 West 10th Street, New York, New York, Apartment No. 8, wherein
the Rent Administrator determined the fair market rent pursuant to
the special fair market rent guideline promulgated by the New York
City Rent Guidelines Board for use in calculating fair market rent
appeals.
The Commissioner notes that this proceeding was filed 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 Administrative Appeal is being determined pursuant to the
provisions of Section 26-513 of the Rent Stabilization Law and
Section 2521.1(d) of the Rent Stabilization Code.
The issue herein is whether the Rent Administrator's order 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 commenced by the tenant's filing of a fair
market rent adjustment application and a rent overcharge complaint
on March 31, 1984 in which the tenant stated that he first moved to
the subject apartment on May 4, 1979, at a rental of $350.00 per
month.
On October 10, 1984, the owner was advised by the DHCR that the
tenant had filed a fair market rent adjustment application and
afforded the opportunity to prove if it or a prior owner had served
a DC-1 or DC-2 Notice of Initial Legal Regulated Rent or Apartment
DH410407RO, SJR7170
Registration Form RR-1 on the first stabilized tenant or subsequent
tenant.
On June 17, 1985, the owner was served by the DHCR with a copy
of the tenant's fair market rent adjustment application and afforded
an opportunity to submit comparability data and proof of service of
the DC-1 or DC-2 Notice or RR-1 form. In a response dated July 2,
1985, the owner's attorney (the same firm representing the owner on
its appeal) stated that the owner's records indicate that prior to
occupancy by the tenant herein, the subject apartment was rent
controlled and first became subject to rent stabilization upon
occupancy by the tenant herein.
On July 15, 1985, the owner was sent a summary notice by the
DHCR advising it that since it failed to submit the data requested
in the notice of June 17, 1985, the fair market rent would be
determined on the basis of the 1978 maximum rent increased by the
appropriate Special Fair Market Rent Guidelines order and giving the
owner ten days for any reply. On July 22, 1985, the owner through
its attorney requested an extension of time to submit comparability
data and was afforded ten days from July 22, 1985 to submit
comparability data in a letter dated July 22, 1985 to its attorney
from the DHCR. No response was received from the owner.
Subsequently on May 26, 1989, the owner was afforded a final
opportunity of twenty days to submit evidence. In a response dated
June 19, 1989, the owner's attorney requested a 30 day extension of
time to answer due to the fact that the May 26, 1989 notice was sent
to the owner and not directly to the owner's attorney. On June 29,
1989, the owner's attorney followed up this request by pointing out
that he had requested maximum base rent information on the subject
apartment from the FOIL Unit and needed an extension until after he
had time to examine the requested rent information. On July 12,
1989, the DHCR sent a letter to the owner's attorney informing him
that the request for an extension had been turned down.
In Order Number ZL3110100RT, the Rent Administrator adjusted
the initial legal regulated rent by establishing a fair market rent
of $161.51 effective May 4, 1979, the commencement date of the
initial rent stabilized lease. The Rent Administrator also
directed that the owner refund excess rent of $19,730.83 to the
tenant covering the period from May 4, 1979 through May 31, 1986.
In this petition, the owner alleges in substance that the
extension should have been granted so that the owner could have
obtained copies of needed rent control and maximum base rent records
prior to completing its answer; that pursuant to the decision in
J.R.D. Management v. Eimicke, the owner was not required to submit
leases prior to April 1, 1980 at the earliest so that the tenant's
complaint should have been dismissed as there was no overcharge
subsequent to April 1, 1980; that the owner had submitted two
comparable rents which were not considered by the Rent
DH410407RO, SJR7170
Administrator; that the Rent Administrator failed to afford the
owner an opportunity to submit current comparables pursuant to
Section 2522.3 of the current Rent Stabilization Code; and that it
is unclear whether or not the tenant actually filed his complaint
prior to April 1, 1984. Along with its petition, the owner
submitted inter alia a copy of a submission listing two comparable
apartments which it claims to have previously submitted.
The Commissioner is of the opinion that this petition should be
denied.
Section 26-513 of the Rent Stabilization Law provides in
pertinent part that fair market rent adjustment applications are to
be determined by the use of special fair market rent guidelines
orders promulgated by the New York City Rent Guidelines Board and by
the rents generally prevailing in the same area for substantially
similar housing accommodations. In order to determine rents
generally prevailing in the same area for substantially similar
housing accommodations, it is DHCR's procedure for fair market rent
appeal cases filed prior to April 1, 1984 to allow owners to submit
June 30, 1974 fair market rent data for complete lines of
apartments, beginning with the subject line. The average of such
comparable rentals will then be updated by annual guidelines
increases. Alternatively, DHCR procedure allows owners to have
comparability determined on the basis of rents charged after June
30, 1974. In order to use this method, owners were required prior
to November 1, 1984 to submit rental history data for all stabilized
apartments in the subject premises and subsequent to November 1,
1984 to submit such data for complete lines of apartments beginning
with the subject line. Post June 30, 1974 rent data will be
utilized if the comparable apartment was rented to a first
stabilized tenant within one year of the renting of the subject
apartment and if the owner submits proof of service of a DC-2 Notice
or apartment registration form indicating that the rent is not
subject to challenge.
The Commissioner finds that the owner was not prejudiced by the
Rent Administrator's refusal to grant the owner's extension request
of June 19, 1989 followed up by an extension request on June 29,
1989 and July 20, 1989. It is noted that the owner and its attorney
were notified of the tenant's fair market rent adjustment
application in 1984, served with a copy of such application in 1985,
and certainly had ample time to formulate a response and /or request
DHCR rent control records in the four years from 1985 through 1989.
Further, the Commissioner is of the opinion that JRD v.
Eimicke, 148 A.D. 2d 610, 539 N.Y.S. 2d 667 (App. Div. 2d Dept.,
1989), is not applicable to this proceeding. The change effected by
Section 14(g) of the Omnibus Housing Act and Section 26-516(g) of
the Rent Stabilization Law, as applied in the JRD case, only
involves rent overcharge proceedings, and does not apply to fair
market rent appeals. Section 26-513 of the Rent Stabilization Law,
DH410407RO, SJR7170
which deals with fair market rent appeals, continues to provide for
determination of fair market rent appeals from the date of the
initial stabilized tenancy. Additionally, the Commissioner notes
that the JRD case is applicable in the Second Department only. This
proceeding is in the First Department where the case of Lavanant v.
DHCR, 148 A.D. 2d 185, 544 N.Y.S. 2d 331 (App. Div. 1st Dept., 1989)
is the determinative authority.
With regard to the owner's contention that it submitted
comparability data in the proceeding before the Rent Administrator,
there is no record in the Rent Administrator's file that such data
was in fact submitted and the owner has submitted no proof of such
earlier submission in its petition. Accordingly, this data
submitted on appeal for the first time cannot be considered since
this is not a de novo proceeding.
With regard to the owner's contention that it be afforded an
opportunity to submit comparability data in accordance with Section
2522.3 of the current Code, it is noted that such code provision
applies only to fair market rent appeals filed after April 1, 1984
and that the processing procedures outlined earlier in this decision
with regard to the submission of comparability data in fair market
rent appeals filed prior to April 1, 1984 were correctly applied in
this case.
Finally, as to the owner's contention that it is unclear
whether the tenant's fair market rent appeal was filed prior to
April 1, 1984, the record including the cancelled post stamp on the
tenant's envelope indicates that the tenant filed his complaint on
March 31, 1984.
The owner is directed to reflect the findings and
determinations made in this order on all future registration
statements, including those for the current year if not already
filed, citing this order as the basis for the change. Registration
statements already on file, however, should not be amended to
reflect the findings and determinations made in this order. The
owner is further directed to adjust subsequent rents to an amount no
greater than that determined by this order plus any lawful
increases.
The owner is directed to roll back the rent to the lawful
stabilized rent consistent with this determination and to refund or
fully credit against future rents over a period not exceeding six
months from the date of receipt of this order, the excess rent
collected by the owner.
In the event the owner does not take appropriate action to
comply within sixty (60) days from the date of issuance of this
order, the tenant may credit the excess rent collected by the owner
against the next month(s) rent until fully offset.
THEREFORE, in accordance with the provisions of the Rent
DH410407RO, SJR7170
Stabilization Law and Code, it is
ORDERED, that this petition for administrative review be, and
the same hereby is, 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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