FC 110220-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
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IN THE MATTER OF THE ADMINISTRATIVE ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO.:
FC 110220-RO
MICHAEL PISTILLI,
DRO DOCKET NO.:
PETITIONER EI-110301-R
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ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
On March 13, 1991, the above named petitioner-owner filed a
Petition for Administrative Review against an order issued on
February 17, 1991, by the District Rent Administrator, concerning
housing accommodations known as Apartment 3-C at 58-35 Granger
Street, Corona, New York, wherein the District Rent Administrator
determined that the tenant had been overcharged in the amount of
$7,931.18, including treble damages.
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 of a rent
overcharge complaint by the tenants on September 12, 1990.
The tenants took occupancy pursuant to a one-year lease
commencing April 1, 1990, and expiring March 31, 1991, at a
monthly rent of $625.00.
The owner was served with a copy of the complaint and was
directed to submit a complete rent history from the base date,
including copies of all leases.
In response, the owner submitted a statement of withdrawal of the
complaint signed by the tenant. However, the tenant later
submitted a letter stating that she had not withdrawn it.
On December 28, 1990, the Administrator notified the owner that
the complete lease history, including all leases in effect since
April 1, 1984, and documentation of all rent increases, must be
submitted within 21 days of the notice date. After the
expiration of that period, the Administrator sent a Final Notice
of Pending Default dated January 25, 1991, wherein it was stated
that the previously requested documentation must be submitted
within 21 days, or the lawful rent would be determined by
procedures utilized upon a default by the owner and that,
furthermore, treble damages will be imposed unless the evidence
establishes that such overcharges were not willful.
On February 27, 1991, the Rent Administrator issued Order No. EI
110301-R, wherein it was determined that the tenant had been
overcharged in the total amount of $7,931.18, including treble
damages. The Administrator determined a lawful rent of $333.39
per month for the prior tenancy commencing on February 1, 1989,
resulting in a monthly overcharge of $316.61 ($650.00 actual rent
- $333.39 = $316.61), and an overcharge of $233.27 per month for
the complainant's lease ($625.00 actual rent - $391.73 =
$233.27).
In its petition, dated March 13, 1991, the owner contends that
the Administrator improperly ignored the lease history that was
timely submitted by the owner, and failed to credit the costs of
new equipment totalling $16,000.00 that was documented in the
material. Enclosed with the petition is a contract for the
installation of new equipment and the total remodelling of the
kitchen and bathroom, which was signed prior to the occupancy of
the prior tenant. The two-page document lists the new equipment
and specific procedures for the reconstruction of both rooms. The
renovation of the kitchen included:
1.Open walls in the kitchen and remove all
domestic feed lines and cast iron waste lines.
2.Replace all hot and cold risers and branches
with copper lines using 90/10 solder.
3.Replace all new 2" and 1 1/4 cast iron no. hub.
4.Install kitchen cabinets.
5.Install and connect 1-24" kitchen stove.
6.Install and connect to domestic water supplies
kitchen sink, strainer and gerber faucet.
7.Remove all rubbish from the apartment.
The renovation of the bathroom included:
To install one complete new bathroom; to remove
entire bathroom down to studding; building a new
bathroom complete with three fixtures; installing
a new medicine cabinet with light switch; complete
sheet rock walls and ceilings; cement float tiles
job around bathtub area; glue tiles around
existing part of the bathroom area; change entire
waste and vent lines with new no-hub cast iron and
fittings; complete new copper water lines, using
controlling valves and 95-5 soldering; removal of
rubbish from the apartment.
Petitioner also includes copies of two checks to the construction
firm for $6,000.00 and $10,000.00 respectively, front and back,
establishing full payment. Finally, the petitioner submits a
copy of its postal receipt for certified delivery on the DHCR,
showing a date of delivery of February 11, 1991. The tenant did
not respond to the petition although afforded an opportunity to
do so.
The Commissioner is of the opinion that this petition should be
granted.
Sections 20(C)(1) of the former Code and 2522.4(a)(1) of the
current Code provide that where thee had been an installation of
new equipment in a stabilized apartment, the monthly
stabilization rent for said unit may be increased by 1/40th the
cost of such equipment provided the tenant then in occupancy has
consented thereto in writing. In addition, the courts have ruled
that an increase for new equipment installed during a vacancy
prior to the commencement of a new tenancy or upon the
commencement of a new tenancy and reflected in the lease rent,
the new tenant's consent to pay such increase is implied (Matter
of LeHavre Corp. v. Gribetz, et al., N.Y.L.J., January 20, 1971,
p. 19, col. 8 (Sup. Ct., Queens Co., Crisona, J.); Matter of
Morton I. Hamberg v. CAB, N.Y.L.J., November 9, 1972, p. 18, col.
8, (Sup. Ct., N.Y. Co., Sarafite, J.).
The record in this case establishes that the owner had timely
delivered the documentation that had been requested, but that it
was either ignored or never seen by the Administrator, since the
order made no mention of them. The material is shown to have
been mailed to the DHCR by certified delivery before the date of
issuance of the Administrator's order. A review of the contract
for the work performed establishes that all items listed are
consistent with a "gut" renovation of the bathroom and kitchen
such as has been found by the Commissioner to qualify for a rent
increase under Section 2522.4 (Accord: Administrative Review
Docket No. CH 510027-RO). Furthermore, there is nothing in the
record that disputes the finding that such renovations have been
satisfactorily completed in full accordance with the contract.
The claim for a rent increase of $400.00 per month (1/40th of the
$16,000.00) is thus substantiated and must be fully included in
the rent calculations. As a result, the addition of $400.00 per
month increase to the prior tenant's vacancy lease, as added to
the adjusted base rent, entirely eliminates the overcharges that
were found in the Administrator's order.
The calculation of the lawful rent is as follows:
1. Prior Tenant's lease: September 30, 1988 rent
of $278.30 + 6% guidelines
increase + 12% vacancy +
$400.00 = $728.39.
Actual rent charged of $650.00
became legal rent.
2. Complaining Tenant's lease: Effective April 1, 1990, was
for $625.00 per month which
then became the legal rent.
If the owner has already complied with the Administrator's order
and there are arrears due to the owner as a result of the instant
determination, the tenant may pay off the arrears in twelve (12)
equal monthly installments. Should the tenant vacate after the
issuance of this order, said arrears shall be payable immedi-
ately.
THEREFORE, pursuant to the Rent Stabilization Law and Code, it is
ORDERED, that the petition be, and the same hereby is granted;
and that the Administrator's order be, and the same hereby is,
revoked.
ISSUED:
ELLIOT SANDER
Deputy Commissioner
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