DOCKET NUMBER: SJR 4728; DI 410298-RO
STATE OF NEW YORK
DIVISION OF HOUSING AND COMMUNITY RENEWAL
OFFICE OF RENT ADMINISTRATION
92-31 UNION HALL STREET
JAMAICA, NEW YORK 11433
------------------------------------X SJR 4728
IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO.: DI 410298-RO
A & V HOLDING CORP. DRO DOCKET NO.: L 3116962-RT
ORDER AND OPINION REMANDING PROCEEDING ON APPEAL
The abovenamed petitioner owner filed a timely Petition for Administrative
Review against an order issued on August 15, 1989 by the Rent
Administrator concerning the housing accommodation known as 98 Riverside
Drive, Apartment 4B, Manhattan.
The owner subsequently instituted an Article 78 proceeding based on a
"deemed denial" of the petition and the proceeding was remitted by the
The tenant, Casper Schmidt, filed a complaint of overcharge and a fair
market rent appeal on or about March 31, 1984 alleging, among other
things, that he took occupancy on December 1, 1980 under a 2 year lease at
a rent of $900.00. A full rental history was submitted.
The herein appealed order of the Rent Administrator impliedly dismissed
the fair market rent appeal but found a total overcharge of $41,981.12,
including interest, through August 31, 1989. The Administrator further
found that the apartment had continually been occupied both residentially
and commercially (psychiatrist's office) and is, therefore, subject to
The Administrator's finding as to residential occupancy was based on the
allegations of the tenant (discussed more fully infra) and documentary
evidence including income tax returns going back to 1980.
The owner has urged throughout this proceeding that the apartment should
be exempt from stabilization because it was rented under a commercial
lease as a psychiatrist's office and the original and all renewal leases
contained specific provisions that it would not be used as a dwelling and
that the tenant's complaints are in bad faith as evidenced by his being in
occupancy for almost 4 years without prior complaints.
The tenant alleged that his residential as well as professional use of the
apartment has always been open and notorious; that when he was first shown
the apartment by a Mr. and Mrs. Hank Sobel of West 79th Street Realty as
the owner's "agents" he advised them of his intentions to use the
apartment residentially and was, in fact, accompanied by his own
contractor with whom he discussed various changes to make the apartment
more suitable for both purposes; that the apartment has always been freely
available for inspection and various repairmen employed by the owner have
DOCKET NUMBER: SJR 4728; DI 410298-RO
observed his use of the apartment; that the owner never made any objection
to his use; that he is not a native New Yorker and was unsophisticated in
rent control and stabilization and only became aware of his rights upon
reading a 1984 New York Times article; and that the owner's use of
commercial leases is a subterfuge.
The owner alleges that the abovenoted Sobels were never employees or
agents of the owner and any fee paid them must have been by the tenant,
not the owner; that the owner never had any occasion to inspect the
apartment and the superintendent never observed the tenant using it for
other than professional purposes (submitting an affidavit from the
The owner further urges, among other things, that the evidence of
residential occupancy submitted by the tenant is all self serving; that
the overcharges should, at most, have been computed back only to when the
owner was notified of the proceeding before this agency; and that the
Commissioner should "apportion the rent" to reflect the commercial use of
The Commissioner is of the opinion that the petition should be remanded
for further processing.
The record contains conflicting allegations and contentions all of which
presently appear consistent with the evidence thusfar in the record
The Commissioner finds, therefore, that a hearing, on notice to all
parties, is necessary to ascertain the facts and circumstances surrounding
the renting and usage of the apartment including the actual intentions,
expectations and knowledge of the parties at all relevant times.
The proceeding is being remanded for such purposes.
THEREFORE, pursuant to the Rent Stabilization Law and Code, it is
ORDERED, that this petition be, and the same hereby is, granted to the
extent of remanding this proceeding to the Rent Administrator for further
processing in accord herewith. The order of the Rent Administrator
remains in full force and effect except that the direction to refund
overcharges is stayed until a new order is issued on remand.