ED 310001 RO
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. ED 310001 RO
: DISTRICT RENT OFFICE
DOCKET NO. ZBF 310290-R
TENANT: Arthur Matwa
ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
On April 4, 1990, the above-named petitioner-owner filed a Petition for
Administrative Review against an order issued on March 28, 1990, by the
Rent Administrator, Gertz Plaza, Jamaica, New York, concerning the
housing accommodations known as 169-171 Silverlake Road, Staten Island,
New York, Apartment No. 1L, wherein the Rent Administrator determined
that the owner had overcharged the tenant.
The Administrative Appeal is being determined pursuant to the provisions
of Section 2526.1 of the Rent Stabilization Code.
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 appeal.
This proceeding was originally commenced by the filing in June 1987 of
a rent overcharge complaint by the tenant who stated in substance that
he believed that he was being overcharged as the prior tenant had been
paying only $425 per month whereas he was charged $750.00 per month upon
commencing occupancy on December 1, 1985. The tenant further stated
that he had received a new refrigerator, stove and dishwasher.
Subsequently the tenant advised that the prior tenant's rent of $425.00
had included a garage which the current tenant does not have.
The owner was served with a copy of the tenant's complaint and directed
to submit a copy of the prior tenant's lease and copies of cancelled
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checks and bills for any improvements made in the subject apartment.
In response, the owner did not submit a copy of the prior lease but
stated that she made expenditures totalling $12,400 when the subject
apartment was vacant including a new refrigerator, stove, dishwasher,
new kitchen cabinets, sink, faucet, six new ceiling light fixtures, new
bathroom with sheetrock, tiles and toilet, scraping and shellacking of
floors, new venetian blinds, sheetrock on all walls, repainting of
walls, installation of room dividers and new window gates. The owner
submitted copies of bills for the kitchen cabinets, sink and faucet, the
dishwasher, refrigerator and stove. Two bills from Eduardo Kuper
listing amount of $5,007.84 and $5,000 were also submitted but no
cancelled checks were submitted.
In Order Number ZBF 310290-R, the Rent Administrator established the
lawful stabilization rent as $427.50 effective December 1, 1985,
determined that the tenant had been overcharged and directed a refund to
the tenant of $44,565.12 including treble damages on that portion of the
overcharge collected on and after April 1, 1984. No allowance for any
of the improvements was given in the Rent Administrator's order based on
a finding that the owner submitted bills without matching cancelled
checks, checks without matching bills, no apartment number on bills and
bills with work performed by the owner's relative.
In this petition, the owner alleges in substance that she was entitled
to a rent increase for the improvements made in the subject apartment so
that no rent overcharge should have been found and that in any event the
imposition of treble damages was not warranted because any overcharges
resulting from a failure to document improvements cannot be
characterized as willful. In addition the owner contends that the prior
tenant Paula Ramos' last rent was $444.00 and that the initial rent of
the tenant herein should be based on this amount. In support of this
contention, the owner submitted a copy of tenant Ramos' lease dated July
1, 1984 to June 30, 1986 at a rental of $444.00 per month including a
two car garage.
With regard to bills and cancelled checks, the owner stated in substance
that $5,000 was paid to contractor Eduardo Kuper (the owner's father) to
do the following:
1) Remove existing material in apartment to prepare for renovation
2) Purchase and install window gates in the master bedroom
3) Purchase and install custom venetian blinds.
4) Restore all floors for entire apartment
5) Purchase and install interior doors and room dividers.
In support of the $5,000 payment made to her father, the owner submitted
copies of five cancelled checks of $1,000 each to her father dated from
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September 1985 through January 1986 and a copy of a statement and bill
detailing the work dated November 1, 1985.
The owner also stated that Eduardo Kuper at her request paid J & K
Distributors $5,007.84 in cash to do the following work in the subject
1) Tape and hang sheetrock
2) Painting of entire apartment
3) Tile the bathroom wall
4) Miscellaneous electric wiring and installation of new fixtures.
In support of the $5,007.84 cash payment to J & K Distributors, the
owner stated that payment was first made to Eduardo Kuper who then paid
J & K Distributors. To show payment to Mr. Kuper, the owner submitted
copies of two checks totalling $1300.00 made out to Mr. Kuper and dated
July 18, 1985 and August 23, 1985 and copies of bank withdrawal
statements totalling $3500 to the owner herein from September 1985 to
December 1985. In addition a copy of a paid bill totalling $5007.84
from J & K Distributors, was submitted.
Further the owner submitted copies of the bills for a new refrigerator,
dishwasher and stove totalling $1,609.67 and copies of bills totalling
approximately $800.00 for miscellaneous items including kitchen
cabinets, sink and faucet.
In response to the owner's petition, the tenant alleges in substance
that since the prior tenant was said to have vacated about October 31,
1985, bills and cancelled checks prior to October 31, 1985 should not be
considered; that the checks given to the owner's father could have been
used for anything; that the following items were done by the owner - new
sink, faucet, kitchen cabinet under sink; new refrigerator, new
dishwasher, new blinds, new plumbing under kitchen sink, new blinds
throughout apartment; painting of subject apartment, wooden floors
throughout apartment were sanded, stained and polished.
The tenant stated that the following items claimed by the owner were not
done - no new gas line, no new doors or room dividers throughout
apartment; no new light switches or fixtures; no new window gates; no
new steam valves and no new door knobs, no repair of windows and no new
tiles, piping and faucets in the bathroom. In addition the tenant
stated that his stove is an "imperial" and not the "rose" stove listed
by the owner.
In a response to the tenant's answer including a supplemental affidavit
to her petition, the owner stated in substance that the prior tenant
vacated in October 1985 as result of a non payment proceeding and did
not pay rent for September and October 1985, that "rose" is the stove
model type and not the color and that the tenant actually received an
"imperial rose style stove", that new doors were installed in the
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kitchen and second bedroom and that other improvements were done as the
owner claimed. Further the owner contends that the subject premises 169
Silver Lake Road and 171 Silver Lake Road have been listed as two three
family houses and the owner was not aware such premises had to be
registered as rent stabilized until a decision was reached on January
19, 1988 under docket ZAK 310003-UC that the premises were part of a
horizontal multiple dwelling subject to the Rent Stabilization Law and
Code and the subject apartment has now been registered in accordance
with such decision.
The Commissioner is of the opinion that this petition should be granted
Section 2522.4 of the Rent Stabilization Code permits a rent increase
equal to one-fortieth the cost of new equipment. Tenant consent is not
required if the new equipment is installed during a vacancy period.
In the instant case the evidence of record including statements made by
the tenant indicate that a new stove, refrigerator, dishwasher, kitchen
cabinet, sink and sink faucet were installed in the subject apartment
immediately prior to occupancy by the tenant herein. The owner has
submitted bills showing a total cost of $1866.66 for these items -
$1609.67 for the refrigerator, dishwasher and stove and $256.99 for the
kitchen cabinet, sink and faucet. Further, the record shows that these
items were ordered or installed during a vacancy period in which tenant
consent was not required. Accordingly the owner is entitled to a rent
increase of $46.67 for such installation.
With regard to the other items submitted by the owner it is noted that
they are either consider normal repairs and maintenance for which no
rent increase is warranted such as the apartment painting or the owner
has failed to sufficiently document the payments made for such items.
In addition the tenant has questioned the actual installation of certain
With regard to the owner's contention that the last rent of the prior
tenant - $444.00 - should have been used to calculate the initial rent
of the tenant herein, it is noted that the owner failed to submit a copy
of the prior tenant's last lease in the proceeding before the Rent
Administrator although afforded an opportunity to do so. Such
submission cannot be considered for the first time on appeal since this
is not a de novo proceeding. Moreover the last rent of the prior tenant
included a garage which the tenant herein does not have.
Accordingly, the April 1, 1984 registered rent of $375.00 was correctly
used by the Rent Administrator to determine the initial rent of the
With regard to the owner's contention that the imposition of treble
damages was not warranted, Section 2526.1 of the Rent Stabilization Code
provides in pertinent part that any owner who is found by the DHCR to
have collected a rent or other consideration in excess of the legal
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regulated rent on and after April 1, 1984 shall be ordered to pay to the
tenant a penalty equal to three times the amount of such excess. If the
owner establishes by a preponderance of the evidence that the overcharge
was not willful, the DHCR shall establish the penalty as the amount of
the overcharge plus interest from the date of the first overcharge on or
after April 1, 1984.
In the instant case, the evidence of record discloses that the
overcharge was primarily due to the owner's failure to sufficiently
document the cost of improvements made in the subject apartment. The
Commissioner is of the opinion that the imposition of treble damages for
this type of overcharge is not warranted.
Taking the above factors into account, the Commissioner has recalculated
the lawful stabilization rents and amount of rent overcharge for the
subject apartment, including interest on the overcharge occurring on and
after April 1, 1984. The lawful stabilization rents and amount of rent
overcharge are set forth on the amended rent calculation chart attached
hereto and made a part hereof.
Because this determination concerns lawful rents only through November
30, 1989, the owner is cautioned to adjust subsequent rents to an amount
no greater than that determined by this order plus any lawful increases,
and to register any adjusted rents with this order and opinion being
given as the explanation for the adjustment.
This order may, 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, be filed and enforced in the same manner as a judgment or not
in excess of twenty percent per month thereof may be offset against any
rent thereafter due the owner.
If the owner has already complied with the Rent Administrator's order
and there are arrears due to the owner as a result of the instant
determination, the tenant shall be permitted to pay off the arrears in
twenty four equal monthly installments. Should the tenant vacate after
the issuance of this order or have already vacated, said arrears shall
be payable immediately.
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, granted in part, and, that the order of the Rent
Administrator be, and the same hereby is, modified in accordance with
this order and opinion. The lawful stabilization rents and the amount
of the rent overcharge are established on the attached chart which is
fully made a part of this order. The amount of the rent overcharge
through November 30, 1989 is $15,539.08.
ED 310001 RO
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner