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
APPEAL OF DOCKET NO. DK410271RO
Townhouse Management Company, : DISTRICT RENT OFFICE
DOCKET NO. TA10868
TENANT: Bruce Rathus
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
AND MODIFYING THE ADMINISTRATOR'S ORDER
On November 28, 1989, the above-named current owner filed a petition for
administrative review of an order issued on October 24, 1989 by the Rent
Administrator concerning the housing accommodations known as 144 East
22 Street, Apartment 6F, New York, New York, wherein the Administrator
determined that the owner had collected excess rent from the tenant.
The Commissioner has reviewed all of the evidence in the record and has
carefully considered that portion of the record relevant to the issues
raised by the administrative appeal.
This proceeding was commenced by the filing of a fair market rent
adjustment application in December of 1982. The tenant had taken
occupancy of the subject apartment on November 1, 1982 at a monthly
rental of $500.00. Included with his application was a copy of the DC-2
notice which had been served upon the tenant less than ninety days
before the filing of this application.
In February of 1983, the prior owner (Meko Holding, Inc.) submitted an
answer which included rental data on the "F" and "C" lines of
Subsequently, the current owner was also served with notice of this
proceeding and was given an opportunity to answer and submit
In the current owner's answer submitted October 2, 1989, it was asserted
that because of the case of J.R.D. Management Co. v. Eimicke, 148 A.D.
2d. 610, 539 N.Y.S. 2d 667 (App. Div. 2d Dept., 1989) the owner "... is
required to submit rent records for the four (4) years prior to the last
registration." The owner concluded that the only records it was
required to submit were for 1985 through 1989. The owner submitted the
leases for the subject apartment from November 1, 1982.
In the Administrator's order, it was determined that none of the
apartments offered by the prior owner for use in a comparability study
were usable because they were either rent controlled or not decontrolled
contemporaneously with the subject apartment. Accordingly, the
Administrator used the Special Fair Market Rent Guidelines only to
determine the fair market rent. The Administrator adjusted the initial
legal regulated rent by establishing a fair market rent of $399.56 per
month effective November 1, 1982, the date of ten commencement of the
initial rent stabilization lease. The total of excess rent collected by
the owners was $6,531.60 for the period of November 1, 1982 through
October 31, 1987. Finally, the Administrator ruled that each owner was
responsible only for that portion of the excess rent that it actually
In its petition for administrative review, the current owner alleges
that the Administrator failed to consider the J.R.D. case in making his
determination; that because of J.R.D. records more than four years old
need not be retained or produced by the owner; and that the lawful rent
should be based on the tenant's April 1, 1984 rent of $535.00 per month.
The Commissioner is of the opinion that this petition for administrative
review should be denied.
The Commissioner is of the opinion that the J.R.D. case is not
applicable to this proceeding. The J.R.D case only involves rent
overcharge proceedings, and does not apply to fair market rent appeals.
Section 26-513 of the Rent Stabilization Law, which deals with fair
market rent appeals, continues to provide for the determination of fair
market rent appeals from the date of the initial stabilized tenancy. In
addition, regarding the submission of comparability data, it is noted
that the owner had the option of submitting either June 30, 1974 data or
post-June 30, 1974 data.
Also, since the issuance of the decision in J.R.D, the Appellate
Division, First Department, in the case of Lavanant v. DHCR, 148 A.D. 2d
185, 544 N.Y.S.2d. 331 (App. Div. 1st Dept., 1989), has issued a
decision finding that the DHCR may properly require an owner to submit
complete rent records, rather than records for just four years. The
Lavanant decision is controlling in the instant case as the subject
apartment is located in the First Department.
The Commissioner notes that the Administrator's order contains two
typographical errors which should be corrected. Namely, in each of the
last two paragraphs on page 2 of the Administrator's order, the
effective date is listed as November 1, 1983. The correct effective
date of the Administrator's order should have been November 1, 1982.
The Administrator's order should be amended to reflect the above.
If the owner does not take appropriate action to comply with this order
within sixty (60) days, the tenant may seek to enforce this order in a
court of competent jurisdiction.
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 determined by this order plus any lawful
increases. A copy of this order is being sent to the current tenant of
the subject apartment.
THEREFORE, in accordance with the provisions of the Rent Stabilization
Law and Code, it is
ORDERED, that this petition for administrative review be, and the same
hereby is, denied, and, the order of the Rent Administrator be, and the
same hereby is, modified in accordance with this order and opinion
JOSEPH A. D'AGOSTA