DK 410109 RO; DJ 410206 RT
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. DK 410109 RO
DJ 410206 RT
: DISTRICT RENT OFFICE
Alfred Knobler, DOCKET NO. ZTA 12172/
and TC 082664 G
Village Brokers, Inc.
Victor Castelli,
TENANT: Victor Castelli
PETITIONERS :
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ORDER AND OPINION DENYING PETITIONS FOR ADMINISTRATIVE REVIEW
On November 8, 1989, the above-named petitioner-owner filed a Petition
for Administrative Review against an order issued on October 3, 1989, by
the Rent Administrator, 92-31 Union Hall Street, Jamaica, New York,
concerning the housing accommodations known as 6 East 10th Street,
New York, New York, Apartment No. 4R, 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.
On October 30, 1989, the above-named petitioner-tenant filed a petition
for administrative review against the aforementioned order. These
petitions are being consolidated for disposition herein.
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 Appeals are being determined pursuant to the
provisions of Section 26-513 of the Rent Stabilization Law.
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 appeals.
This proceeding was originally commenced in February 1984 by the filing
of a fair market rent adjustment application (hereafter FMRA) by the
DK 410109 RO; DJ 410206 RT
tenant who took occupancy of the subject apartment on January 1, 1984 at
a rental of $781.32 per month.
In addition, the tenant filed a complaint of rent overcharge on February
15, 1984.
The owner was served with a copy of the tenant's application and
afforded an opportunity to submit June 30, 1974 or post June 30, 1974
comparability data for determining the fair market rent of the subject
apartment and to submit proof of any improvements made in the subject
apartment.
The owner was also served a copy of the tenant's complaint of rent
overcharge.
By notice to both parties, the Rent Administrator consolidated the
tenant's complaints on December 31, 1987.
In response, the owner submitted leases for the subject apartment in
effect from April 15, 1974. The owner failed to submit either a copy of
the notice of Initial Legal Regulated Rent (DC-1 or DC-2) with proof of
service on the initial or a subsequent stabilized tenant nor comparable
apartments for consideration for comparability.
In Order Number ZTA 12172/TC 082664G, the Rent Administrator adjusted
the initial legal regulated rent by establishing a fair market rent of
$283.22 (excluding comparability) effective April 15, 1974 and re-
computed the subsequent rents.
In this petition, the owner contends in substance that the Rent
Administrator erred in requesting comparability data exceeding the 4
year limitation, in that the order contravenes the JRD decision limiting
rent history requests to 4 years as provided in Section 26-516(g) of the
Rent Stabilization Law; that there exists ambiguity due to the notices
sent for the tenant's multiple docket numbers for both the subject
apartment and another apartment in the building in which the tenant
resided prior to the subject apartment; that the owner was not afforded
sufficient time to respond because the order was issued on the last day
that the owner could have submitted evidence; that the owner should be
allowed to supplement its' petition to submit comparability; that
apartment 4R is unique because it is the only apartment in the building
with a terrace; and that the fact that the tenant ceased to pay rent in
January 1989 should be reflected in the order.
In answer to the owner's petition, the tenant states in substance that
the owner's petition should be denied because the owner's contention
that it had insufficient time to respond is without merit; that the
owner who had held title to the subject building since 1969 was served
in early 1984 and subsequently in 1989 but never submitted
comparability data; that the owner's citation of JRD was in error and
that the Lavanant decision upheld DHCR's right to request rental records
beyond 4 years in cases filed prior to April 1, 1984; and that apartment
4R is not unique due to the terrace the tenant cited apartment 3R as
another terraced apartment in the building. Further, the tenant
reiterates issues presented in his own petition.
In his petition, the tenant contends in substance that the Rent
Administrator's order should be modified to address the issue of the
DK 410109 RO; DJ 410206 RT
owner's failure to allow a two year lease option to the tenant when he
took occupancy of the subject apartment in January 1984 and to impose
treble damages. The tenant submitted a copy of his letter dated
November 7, 1985 addressed to the Rent Administrator in which the tenant
raised the issue of the owner's failure to allow a two year vacancy
lease option.
In answer to the tenant's petition, the owner stated in substance that
the vacancy lease was negotiated to the tenant's benefit in being
allowed to transfer from apartment 5F to a larger terraced apartment
(4R); that the tenant never requested a two year option; and that the
owner had never seen the tenant's correspondence requesting a two year
option.
The Commissioner is of the opinion that these petitions 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 rental 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 apartment 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.
An examination of the record in this case discloses that the complaints
were filed prior to April 1, 1984 and the owner was advised on March 7,
1984 of the pending complaints and of the requirement to preserve rental
records. Additionally, the owner was directed on August 10, 1984, July
21, 1986 and October 27, 1988 to submit all leases from the base date
and the owner complied with the directive by the submission of complete
leases for the subject apartment from April 15, 1974 to October 25,
1988.
Further, the owner was served the tenant's application and the FMRA
package on May 7, 1984, September 18, 1984, October 27, 1988 and
September 12, 1989 which advised the owner of the above cited
requirements for comparability submissions and which listed the subject
apartment and correct docket numbers. The Rent Administrator's order
was issued in a timely fashion and not prior to the 21st day from the
date of mailing of the last notice to the owner in which the owner was
advised that all submissions must be made within a 20 day period.
DK 410109 RO; DJ 410206 RT
Moreover, the owner has fail to submit comparability data either below
or on appeal.
The Commissioner, therefore, rejects the owner's contention that it had
insufficient time to submit comparability data as without merit.
The Commissioner rejects the owner's contention that Section 26-516(g)
precluded the Rent Administrator from requesting comparability data
beyond the 4 year limitation period. Section 26-516(g) was promulgated
for cases filed after 1984 and specifically excludes FMRA, therefore it
is not applicable to the instant case. Moreover, the owner's reliance
on the JRD decision is misplaced as that decision is determinative for
overcharge cases filed for dwelling units located in the Second
Department and does not apply to FMRA proceedings. In addition, the
owner was not required to submit comparability data, but had the option
to do so.
With regard to the owner's contention that it be permitted to supplement
its petition to submit comparability data, the Commissioner notes that
since this is not a de novo proceeding, it would be inappropriate to
consider any comparability submission for the first time on appeal.
Moreover, the owner filed its' petition in 1989 and as of September 1992
has failed to file any supplement to its petition.
The Rent Administrator's order calculated the lawful stabilization rent
and amount of refund only through December 31, 1988 and, therefore, that
portion of the owner's petition seeking to amend the order to reflect
that the tenant ceased to pay rent on January 1989 is rejected as being
without merit.
With regard to the tenant's contention that the Rent Administrator
failed to address the tenant's ancillary complaint that the owner did
not allow him a 2 year option for his vacancy lease but coerced him to
execute a one year vacancy lease, the Commissioner notes that that issue
was not part of the original complaints filed on February 1, 1984 and
February 15, 1984 which were served on the owner. Although Section
2527.10 of the Rent Stabilization Code provides in pertinent part that
an applicant or complainant shall have the right to amend the
application or complaint in writing prior to the time within which an
answer may be filed, it is noted that in the instant case, the tenant
first raised the issue of the owner's failure to allow the tenant the
option of more than a one year vacancy lease in a letter to the Rent
Administrator dated November 7, 1985. This was in excess of the time
period in which to amend the complaints filed February 1, 1984 and
February 15, 1984 and therefore the Rent Administrator was not obligated
to consider the ancillary complaint.
Accordingly the Commissioner rejects the tenant's contention that the
Rent Administrator erred in failing to consider the ancillary complaint
and adjust his vacancy lease term.
With regard to that portion of the tenant's petition requesting the
imposition of treble damages, the Commissioner notes that Section
2526.1(a) of the Rent Stabilization Code which provides for the
imposition of treble damages specifically excludes FMRA.
Accordingly, the Rent Administrator's order was warranted.
DK 410109 RO; DJ 410206 RT
Because this determination concerns lawful rents only through
December 31, 1988, the owner is cautioned to adjust subsequent rents to
an amount no greater than that determined by the Rent Administrator's
order plus any lawful increases, and to register any adjusted rents with
this order and opinion being given as the explanation for the
adjustment.
If the owner does not take appropriate action to comply with this order
within sixty days from the date of issuance of this order, the tenant
may credit the excess rent against the next month(s) rent until fully
offset.
THEREFORE, in accordance with the provisions of the Rent Stabilization
Law and Code, it is
ORDERED, that these petitions for administrative review 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
Acting Deputy Commissioner
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