ADM. REVIEW DOCKET NO. EI 710029 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 
          IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
          APPEAL      OF                                    DOCKET       NO.
                                                 EI 710029 RO    
                                              :  RENT ADMINISTRATOR'S DOCKET 
                                                 NO.       DJ       710084-R
                 ARTHUR T. MOTT                              
                                                 Tenant:    Susan     Gibson
                          

                                              
                                 PETITIONER   :  
          ------------------------------------X 

            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
            IN PART  

               On September 4, 1990, the above-named owner filed a  petition
          for administrative review of an order issued on July 30,  1990  by
          the    District    Rent    Administrator,    concerning    housing
          accommodations known as Apartment  1-C,  25  Peninsula  Boulevard,
          Hempstead, New York, wherein the Administrator determined that the 
          tenant had been overcharged. 

               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  commenced  by  the  filing  of  a  rent
          overcharge complaint by the tenant, dated October 16, 1989.

               The tenant took occupancy pursuant to a sub-lease  commencing
          on August 1, 1986 at a monthly rent of $390.15. 

               In its answer the owner provided a complete  rental  history.
          In addition, the owner states that the  complaining  tenant  first
          lawfully occupied the subject apartment on May 1, 1989;  that  the
          tenant was being charged less than the legal regulated  rent,  and
          was charged $150.00 per month for two off-street  parking  spaces,
          pursuant to a signed stipulation with the tenant. 

               The Administrator requested that the Hearing  Bureau  of  the
          Division of Housing and Community  Renewal  (D.H.C.R.)  conduct  a
          hearing on the issue of whether the owner was charging an unlawful 
          rent, and if so, whether it was willful.




           
               A hearing was held on April 6, 1990, wherein both the  tenant
          and  owner  appeared.   The  Administrative  Law  Judge  made  the






          ADM. REVIEW DOCKET NO. EI 710029 RO
          following determination:

                    1) The complaining tenant commenced occupancy
                    of the subject apartment on August 1, 1986 
                    pursuant to an agreement with the then primary
                    tenant and had been paying rent directly to the owner
                    since then;

                    2) The primary tenant entered into a two year 
                    renewal lease commencing on June 1, 1987 and 
                    expiring on May 31, 1989 for a monthly rent of
                    $411.61, and a $25.00 fee was added for an
                    additional occupant to the subject apartment for a
                    total of $436.61.  The complaining tenant remained 
                    in occupancy and paid the above-mentioned rent to
                    the owner, until April 30, 1989; 

                    3) That the complaining tenant entered into a four-
                    month lease with the owner commencing  on  May  1,  1989
                    and expiring on August 31, 1989 at a monthly rent of 
                    $650.00; 

                    4) Subsequently the complaining tenant entered into a
                    one-year lease commencing on September 1, 1989 and 
                    expiring on August 31, 1990 at $650.00 per month;

                    5) That the $25.00 monthly charge added to the monthly 
                    rent was unlawful based on the facts of this proceeding;

                    6) That the charge for  parking  was  unlawful,  because
                    free parking was a service included in the rent on or  
                    subsequent to the base date;

                    7) That if the parking was not a service included in
                    the rent it would have been unlawful to charge the 
                    tenant for parking in this proceeding since parking
                    is an ancillary service requiring the tenant's written
                    consent before it can be included in the rent.  It was
                    found that no such consent was given by the tenant;

                    8) That the owner fraudulently obtained the tenant's
                    signature on the RA-79 form which purports to consent
                    to include parking in the rent.  That the RA-79 form did 
                    not include parking as being included in the rent upon 
                    being signed by the tenant, but was added by the owner 
                    at a later date, and that     

                    9) The owner willfully overcharged the tenant, and that
                    treble damages should be imposed upon the owner.





               In the order under review  herein,  the  Administrator  found
          that there was a rent overcharge of  $7,787.97,  including  excess
          security and treble damages. 

               In this petition the owner  asserts  that  the  Administrator






          ADM. REVIEW DOCKET NO. EI 710029 RO
          incorrectly used the one-year,  guideline  increase  of  3.5%  for
          establishing the rent in the lease commencing on June 1,1987,  and
          expiring on May 31, 1989, instead of using the two-year  guideline
          increase of 5%; that the  complaining  tenant's  consent  for  the
          increased services  for  parking  is  unnecessary,  based  upon  a
          D.H.C.R. fact sheet (which is  attached  to  the  petition)  which
          states that "neither prior approval by DHCR nor written consent of 
          the tenant is required when the  new  service,  new  equipment  or
          improvements are installed during a vacancy."    

               The  petitioner  further  asserts  that  the  owner  included
          parking in the rent because of his reliance on  two  prior  orders
          issued by D.H.C.R., which allowed  the  owner  to  assign  parking
          spaces to apartments during vacancy periods, and include it in the 
          rent.  The owner alleges that  the  overcharge  was  not  willful,
          since the rent was based on D.H.C.R.'s bulletins, orders, and past 
          policy.   Therefore,  the  Administrator's  imposition  of  treble
          damages was improper. 

               The Commissioner is of the opinion that this petition  should
          be granted in part.

               The Commissioner notes that the petitioner is correct in  his
          assertion that the legal regulated rent for the  lease  commencing
          on June 1, 1987 and expiring on May  31,  1989  is  $411.61.   The
          prior tenants (Hosseini and Shah) vacated the subject apartment on 
          April 30, 1989, which was prior to the expiration of their  lease.
          The initial legal regulated rent of the complaining tenant  is  to
          be determined pursuant  to  Section  2202.5(c)(6)  of  the  Tenant
          Protection Regulations.  The  subject  tenant's  initial  rent  is
          determined by adjusting the  last  tenant's  (Hosseini/Shah)  last
          rent amount to the amount that would have been in effect  had  the
          prior tenant's last lease been for a term  commensurate  with  his
          actual occupancy, which  was  less  than  two  years.   Under  the
          applicable guideline in effect on June 1,  1987,  when  the  prior
          tenants' lease was last renewed, a 4%  increase,  to  $405.76  per
          month, would have been applicable for a lease  of  less  than  two
          years.  Accordingly, the subject tenant's initial rent is  $466.62
          per month, as of May 1, 1989, as  the  guideline  then  in  effect
          provided for a 15% vacancy lease increase.       

               The legal regulated rent for  the  subject  tenant's  renewal
          lease commencing on September 1, 1989 and expiring on  August  31,
          1990  remains  at  $466.62  per  month.   The  Tenant   Protection
          Regulations and the applicable guidelines for leases commencing on 
          September 1, 1989 do not permit  guideline  increases  for  leases
          which are for under one year.  Since the owner received a 15% 




          vacancy increase on  May  1,  1989,  pursuant  to  the  applicable
          guidelines the legal rent may not exceed 15% above the prior legal
          regulated rent.  Accordingly, the  owner  is  not  entitled  to  a
          guideline increase for the lease commencing on September 1, 1989. 

               The Commissioner notes that the petitioner does  not  dispute
          the  Hearing  Officer's  finding  that  the  subject  tenant   was
          fraudulently induced in signing the RA-79  form,  which  allegedly






          ADM. REVIEW DOCKET NO. EI 710029 RO
          gave  her  consent  to  paying  a  fee  for  off-street   parking.
          Accordingly,  the  Commissioner  finds   that   the   tenant   was
          fraudulently induced in consenting to pay a fee for parking.

               The Commissioner finds that the  D.H.C.R.'s  fact  sheet  and
          orders, which are attached to the petition, do not  exonerate  the
          owner from overcharging the tenant.  The fact sheet  clearly  does
          not apply to  parking  spaces,  since  it  only  pertains  to  new
          services that are installed during a vacancy.   As  determined  by
          the administrative law judge, parking was a  service  included  in
          the subject apartment's rent on the base date, and is  a  required
          service.  Therefore, it can not be considered to be a new service. 
           
               Accordingly, and also in light of the  fact  that  the  owner
          committed fraud, diminishing  his  credibility,  the  Commissioner
          finds that the owner did not rely on the fact  sheet  as  a  basis
          for charging the tenant for parking.

               The prior  D.H.C.R.  orders  are  distinguishable  from  this
          proceeding because in the prior orders parking was not found to be 
          a required service to be included in the rent, as it was  in  this
          proceeding.  The owner's misinterpretation of the prior orders  is
          not an excuse  for  overcharging  the  tenant.   Accordingly,  the
          Commissioner affirms  the  Administrator's  imposition  of  treble
          damages on the owner. 

               A recalculation of the rent chart indicates that  the  amount
          of overcharges found by  the  Administrator  was  incorrect.   The
          total  overcharge  (without  added  penalty)  determined  by   the
          Commissioner is $2,750.70.   Pursuant  to  the  Tenant  Protection
          Regulations, treble damages are to be imposed against  the  owner,
          for a total amount of $8,435.48 including excess security.

               Accordingly, the owner's  petition  is  granted  in  part  to
          reflect the increase in the lawful stabilized rent for  the  lease
          period commencing on May 1, 1989. 

               THEREFORE, in accordance with the provisions  of  the  Tenant
          Protection Regulations, it is

               ORDERED, that this petition  be,  and  the  same  hereby  is,
          granted in part; and that the Rent Administrator's order  be,  and
          the same hereby is, modified in accordance  with  this  Order  and
          Opinion, and it is   




               FURTHER ORDERED, that the attached rent calculation chart  be
          incorporated in this order and made a part hereof; and it is 

               FURTHER ORDERED, that rents after August 31,  1990  shall  be
          based upon the $466.62 monthly  rent  as  indicated  on  the  rent
          calculation chart; and it is 

               FURTHER ORDERED, that the owner shall immediately  refund  to
          the tenant all amounts not yet refunded representing  overcharges,
          penalties, and treble damages; and it is  







          ADM. REVIEW DOCKET NO. EI 710029 RO
               FURTHER ORDERED, that if  the  owner  has  refunded  no  such
          amounts upon the expiration of the  period  for  seeking  judicial
          review of this order pursuant to Article 78 of the Civil  Practice
          Law and Rules, and the tenant has credited no  such  amounts,  the
          tenant may file and enforce a certified copy of this  order  as  a
          judgment for the amount of $8,435.48 against the owner, Arthur  T.
          Mott. 

          ISSUED:







                                                                        
                                          ELLIOT SANDER
                                          Deputy Commissioner



                                          






























    

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