DOCKET NO.: EG 610159 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 5931 (Mandamus)
IN THE MATTER OF THE ADMINISTRATIVE ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO.: EG 610159-RO
M. & L. Milevoi, DRO DOCKET NO.:
ZDB-610266-R
TENANT: Maria Arias
PETITIONERS
-------------------------------------X
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On July 9, 1990 the above named petitioner-owners filed a
Petition for Administrative Review against an order issued on
July 2, 1990 by the Rent Administrator, 92-31 Union Hall Street,
Jamaica, New York concerning housing accommodations known as
Apartment 31-A at 1188 Grand Concourse, Bronx, New York wherein
the Rent Administrator determined that the owners had overcharged
the tenant.
The issue in this appeal is whether the Rent Administrator's
order was warranted.
The applicable sections of the Law are Section 26-516 of the Rent
Stabilization Law and Sections 2522.4(a) and 2526.1 of the Rent
Stabilization Code.
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
February, 1989 of a rent overcharge complaint by the tenant, in
which she stated that she had commenced occupancy on November 1,
1988 at a rent of $700.00 per month, and that the previous tenant
had a rent of $305.69.
The owner was served with a copy of the complaint and was
requested to submit rent records to prove the lawfulness of the
rent being charged. In answer to the complaint, the owner
DOCKET NO.: EG 610159 RO
submitted a complete rental history from base date as required,
including invoices and cancelled checks for improvements.
In an order issued on July 2, 1990 the Rent Administrator,
disallowing all claimed improvements and imposing treble damages,
determined that the tenant had been overcharged in
the amount of $20,851.44 as of June 30, 1990, and directed the
owners to refund such overcharge to the tenant as well as to
reduce the rent.
In this petition, the owners contend in substance that there was
no rent overcharge in that the Rent Administrator's order failed
to take into account the fact that they had done a lot of work on
the subject apartment during a vacancy and had submitted proof of
the expenditures.
The Commissioner is of the opinion that this petition should be
denied.
The owner based its claim to an entitlement to a large rent
increase on the payment of $13,583.60, drawn on an "M. & L.
Milevoi Special" checking account, to Mario Heating Contractor,
Inc. for a new kitchen complete with new walls, new floor, new
cabinets, new stove, and new refrigerator; two new bedroom walls,
two new living room walls; new walls and ceiling in the dining
room; new doors and locks; new closet doors; and other
miscellaneous items. Mario Heating Contractor, Inc., paid
$13,583.60 by the owner for the renovations, had paid more than
that for materials and equipment alone to Ditmars Lumber &
Millwork, Inc. ($9,616.82) and Long Island Janitorial Supply
($5,000.57). Although these vendors were paid by Mario Heating
Contractor, Inc., all invoices named "Mario Milevoi," "Mr.
Milevoi Htg. Contg.," "Mr. Milevoi," or "Milevoi." The checks
drawn on Mario Heating Contractor, Inc. were signed by either
Lucia Milevoi or Mario Milevoi, in the same handwriting used on
the present petition and on the tenant's leases with Mario and
Lucia Milevoi. The address (20-66 43rd Street, Astoria) given on
Mario Heating Contractor's checks is also the address given on
the apartment registration for the building owners, Mario and
Lucia Milevoi. This strongly suggested that Mario Heating
Contractor Inc. was owned by Mario and Lucia Milevoi of M. & L.
Milevoi, the owners of the subject apartment. Because a rent
increase based on work done by an owner's own company requires a
closer scrutiny of claimed expenditures, a staff member of the
DOCKET NO.: EG 610159 RO
DHCR conducted a physical inspection of the subject apartment on
May 2, 1990 to look for the claimed inprovements. The inspector
noted that one pair of door lock handles had been installed, but
found no evidence of new locks, pre-hung door units, bifold
units, new bedroom door locks, passage lock, or new oak flooring.
The inspector noted that one dining room wall was cracked and
peeling paint or plaster, and that another one had been plastered
but was in need of painting. While the inspector was requested
to look for new bedroom and dining room walls, new dining room
ceiling and new appliances claimed to have been installed in
October, 1988, he reported just that they were not defective.
However, at the end of the inspection report, following the
specific items looked for, he noted "N/E [no evidence] of any new
installation in the apartment." Based upon this inspection,
which failed to find evidence of the improvements purportedly
made by the owner's company (other than the new doorknob pair,
which could be considered ordinary maintenance and repairs), the
Commisioner finds that the Administrator was warranted in denying
any rent increase based upon claimed improvements. While the
owners, through their company Mario Heating Contractor, may have
purchased various materials and new equipment, the evidence of
record including the results of a physical inspection does not
indicate that the expenditures were for the benefit of the
subject apartment.
The owners are cautioned to adjust the rent, in leases after
those considered by the Administrator, to amounts no greater than
that determined by the Administrator's order plus any lawful
increases, and to register any adjusted rents with the
Administrator's order being given as the reason for the
adjustment.
This order may, upon the expiration of the period in which the
owners may institute a proceeding pursuant to Article seventy-
eight of the civil practice law and rules, be filed and enforced
by the tenant in the same manner as a judgment or not in excess
of twenty percent thereof per month may be offset against any
rent thereafter due the owners.
THEREFORE, in accordance with the Rent Stabilization Law and
Code, it is
ORDERED, that this petition be, and the same hereby is, denied
and that the Rent Administrator's order be, and the same hereby
DOCKET NO.: EG 610159 RO
is, affirmed. The lawful stabilization rent is $385.82 per month
in the lease commencing November 1, 1989. The total overcharge,
including excess security of $352.68, is $20,851.44 as of June
30, 1990.
ISSUED:
ELLIOT SANDER
Deputy Commissioner
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