ADM. REVIEW DOCKET NOS.: DL 510182 RO & EA 410071 RO
                                    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

          ------------------------------------X  SJR - 5773
          IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
          APPEALS     OF                                  DOCKET      NOS.:
                                                 DL 510182 RO 
                                              :  EA 410071 RO
                                                 
                                                 DRO      ORDER       NOS.:
                                                 AH        510116         R
                                                 AH 410309 RV     
               Z. KEN DARIAN - OWNER                                  
                                                 Tenant - Laurie Newman
                              PETITIONER      : 
          ------------------------------------X 

            ORDER AND OPINION DENYING PETITIONS FOR ADMINISTRATIVE REVIEW


               On December 20, 1989 and on December 2 ,  1989,  the  above-
          named petitioner-owner timely filed Petitions for  Administrative
          Review  against  two  related   orders   issued   by   the   Rent
          Administrator, 92-31 Union Hall Street,  Jamaica,  New  York,  on
          November 17, 1989 and December 12, 1989, respectively, concerning 
          the housing accommodation known as 209 E. 81st Street, New  York,
          New York, Apartment  4A  wherein  the  Administrator  directed  a
          refund of $1266.72 inclusive of treble damages on the  overcharge
          and conditionally directed  the  owner  to  offer  the  tenant  a
          renewal lease.

               Pursuant to applicable provisions of the Rent  Stabilization
          Code, the Petitions for Administrative Review were deemed  denied
          and on May 31, 1991 the petitioner herein instituted  an  Article
          78 proceeding pursuant to  the  Civil  Practice  Law  and  Rules,
          requesting that the Administrator's orders  be  vacated  and  set
          aside as arbitrary and capricious.

               In its Article 78 Petition, the owner asserts,  among  other
          things, that the orders here at issue  improperly  set  aside  an
          arms-length negotiated  agreement  between  the  tenant  and  the
          owner.

               On August 14, 1986, the tenant commenced  these  proceedings
          by filing two complaints:   one  alleging  that  the  rent  being
          collected was an overcharge; and the other alleging that the 


          owner had failed to offer the tenant a renewal lease.  The tenant 
          asserted that she had commenced occupancy of the subject premises 
          pursuant to a sublease commencing March 1, 1984  and  terminating
          September 30, 1985 at  a  monthly  rent  of  $465.30,  the  prime
          tenant's rent $423.00 plus a sublet  allowance  equal  to  a  10%
          vacancy increase. 

               In answer to the complaints, the  owner  asserted  that  the






          ADM. REVIEW DOCKET NOS.: DL 510182 RO & EA 410071 RO
          complainant had illegally remained in the subject apartment after 
          the expiration of both the prime lease and the sublease  and  was
          not a tenant but only an occupant or licensee,  not  entitled  to
          the rights of a Rent Stabilization tenant.  In  support  thereof,
          the owner submitted a copy of an agreement  (called  a  surrender
          agreement by the owner) whereby the tenant agreed to pay for  use
          and occupancy only and to  vacate  the  subject  apartment  by  a
          specific date.   Thereafter,  the  owner  initiated  a  hold-over
          proceeding in the New York City Civil Court which was voluntarily 
          discontinued by the petitioner in October 1987.   

               In rebuttal, the tenant asserted that the owner had accepted 
          rent payments directly from her during the term of  the  sublease
          and after the expiration of both the sublease  and  prime  lease.
          The tenant submitted copies of rent checks made  payable  to  the
          owner and subscribed by the tenant.  The tenant further  asserted
          that she had signed the so-called  surrender  agreement  in  fear
          that she would be evicted.

               In the order issued on November 17, 1989, the  Administrator
          determined that an overcharge had occurred and directed the owner 
          to roll back the rent  and  to  refund  overcharges  of  $1266.72
          inclusive of treble damages on the overcharges. 

               In the order issued on December 12, 1989, the  Administrator
          determined that the owner had recognized the claimant as a  prime
          tenant with all the rights of a  Rent  Stabilization  tenant  and
          directed  the  owner  to  offer  the  tenant  a   renewal   lease
          conditioned upon the tenant paying all rent arrears. 

               In the appeals, the petitioner contends that the orders here 
          under review should be reversed because 1)  as  a  subtenant  the
          claimant had no succession rights to the subject premises; 2) the 
          claimant had agreed to surrender all rights, title  and  interest
          in the subject premises; and 3) any money paid by the tenant  was
          only for use and occupancy and not for rent.  With respect to the 
          overcharge complaint, the owner contends that  the  Administrator
          neglected to take into account money  which  had  been  spent  on
          improvements to the subject apartment.



               In reply, the tenant contends that the owner  accepted  rent
          from her at the same rate even after the expiration of the sublet 
          term.  The tenant disputes the owner's  claimed  improvements  as
          unsupported and without merit.  The tenant challenges the 
          validity of the agreement dated February  11,  1986.  The  tenant
          asserts she was not represented by counsel when  she  signed  the
          agreement which she contends is  improperly  characterized  as  a
          surrender agreement by the owner.     

               After careful consideration,  the  Commissioner  is  of  the
          opinion that these petitions should be denied.

               Although pursuant to the Rent Stabilization Code,  an  owner
          is not required to offer a lease to a subtenant, in  the  instant
          case,  an   independent   landlord-tenant   relationship   arose.
          Examination of the available  record  discloses  that  the  owner
          accepted rent payments directly from the tenant both  during  the






          ADM. REVIEW DOCKET NOS.: DL 510182 RO & EA 410071 RO
          sublet term and on a month to month basis after the expiration of 
          the lease, thereby establishing the landlord-tenant relationship. 

               Moreover, Section 2520.6(d) of the Code  defines  tenant  as
          "(A)ny person ... who is or are a party or parties  to  a  rental
          agreement and obligated to pay rent for the use or occupancy of a 
          housing accommodation."  The agreement dated  February  11,  1986
          established the conditions of occupancy, including the length  of
          term and the amount of payment for use and  occupancy.   Pursuant
          to Code Section 2520.6(c) rent may be  defined  as  consideration
          for use and occupancy.  Although the owner calls the agreement  a
          surrender agreement, it could also accurately be called a  rental
          agreement.  Code Section 2520.12  provides,  in  pertinent  part,
          that "the provisions of any lease or other rental agreement shall 
          remain in force pursuant to the terms thereof, except insofar  as
          those provisions are inconsistent...,  and  in  such  event  such
          provisions shall be void and unenforceable."  With respect to the 
          tenant's alleged surrender of all right, title, and  interest  in
          the subject accommodation, it is  noted  that  pursuant  to  Code
          Section 2520.13, an agreement by a tenant to waive the benefit of 
          any provision of the Rent Stabilization  Law  or  Code  is  void.
          Accordingly, the provisions of the agreement which  required  the
          tenant to vacate the premises are void.   

               The issue of the cost of improvements was not presented  for
          consideration to the Administrator and thus is beyond  the  scope
          of review of this order.






               Pursuant to the relevant sections of the Rent  Stabilization
          Code, the Commissioner finds  that  the  Administrator  correctly
          determined that the claimant was a tenant entitled to all rights
          of the Rent Stabilization Law and Code, including  a  lease,  and
          correctly determined that an overcharge had occurred.

               The Commissioner notes  that  the  tenant  has  vacated  the
          subject apartment. 

               Upon the expiration of the period in  which  the  owner  may
          institute a proceeding  pursuant  to  Article  78  of  the  Civil
          Practice Law and Rules, this order may be filed and  enforced  as
          judgment. 

               THEREFORE, in accordance with the Rent Stabilization Law and 
          Code, it is

               ORDERED, that these petitions be, and the same  hereby  are,
          denied, and the Rent Administrator's  orders  be,  and  the  same
          hereby are, affirmed.

          ISSUED:










          ADM. REVIEW DOCKET NOS.: DL 510182 RO & EA 410071 RO




                                                                        
                                          ELLIOT SANDER
                                          Deputy Commissioner




                                                    

    

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