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
APPEALS OF DOCKET NO. DK410168RO
: DISTRICT RENT OFFICE
Alfred Knobler, DOCKET NO. ZTA012319
Village Brokers, Inc.
TENANT: Victor Castelli
ORDER AND OPINION DENYING PETITIONS FOR ADMINISTRATIVE REVIEW
On November 21, 1989, the above-named petitioner-owner filed a Petition
for Administrative Review against an order issued on October 18, 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. 5F, 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 November 13, 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
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
tenant who took occupancy of the subject apartment on January 1, 1981 at
a rental of $571.29 per month.
The tenant vacated the subject apartment on December 31, 1983 and
relocated to apartment 4R in the subject building.
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
In Order Number ZTA012319, the Rent Administrator adjusted the initial
legal regulated rent by establishing a fair market rent of $406.04
(excluding comparability) effective July 15, 1981.
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 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; and that the owner should be allowed to
supplement its petition to submit comparability.
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. 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
owner's failure to allow a three year lease option to the tenant when he
took occupancy of the subject apartment in July 1981 and failed to
assess interest. 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 three year vacancy
In response to the tenant's petition, the owner stated in substance that
the tenant's original complaint did not raise the issue of lease option
and that a similar argument by the tenant was rejected by the
Commissioner in orders DK410109RO and DJ410206RT issued on November 12,
1992 for the tenant's current apartment (4R).
The Commissioner is of the opinion that these petitions should be
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.
The record in this case indicates that the owner was served with the
tenant's application and the FMRA package on May 4, 1984, September 18,
1984, 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 the 20 day period.
Moreover, the owner has failed 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.
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 3 year option for his vacancy lease but coerced him to
execute a one year vacancy lease, the Commissioner notes that issue was
not part of the original application filed on February 15, 1984 which
was served on the owner and cannot properly be considered for the first
time on appeal.
Section 2527.10 of the RSC 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
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 application
filed on February 15, 1984 and therefore the Rent Administrator was not
obligated to consider the ancillary complaint.
Moreover, Section 48 of Chapter 403, Laws of 1983 amended the Rent
Stabilization Law to allow the tenant the option of the lease term (one
or two years) in vacancy leases as well as in renewal leases. This
change was effective for leases commencing on or after October 1, 1983
and therefore the owner was not obliged to offer the tenant the option
of a three year vacancy lease term in July, 1981.
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
assessment of interest, the Commissioner rejects the tenant's contention
because Section 2526.1(a) of the Rent Stabilization Code which provides
for the imposition of interest, specifically excludes fair market rent
appeals, as well as overcharges collected prior to April 1, 1984.
Accordingly, the Rent Administrator's order was warranted.
Because this determination concerns lawful rents only through
December 31, 1983, 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.
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
herein may seek to entrance this order by filing an appropriate action
in a court of competent jurisdiction.
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.
A copy of this order is being served on the current occupant of the
JOSEPH A. D'AGOSTA