DOCKET NO.: FH810200RO
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 :
APPEAL OF ADMINISTRATIVE REVIEW
: DOCKET NO. FH810200RO
SPENCER MANAGEMENT CORP. DRO DOCKET NOS. EG910003RP
PETITIONER TENANTS: PATRICIA & RODOLFO DIAZ
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On August 15, 1991, the above-named petitioner-owner timely refiled a
Petition for Administrative Review of an order issued on April 11, 1991,
by the District Rent Administrator, 55 Church Street, White Plains, New
York, concerning housing accommodations known as 92 Cooper Drive,
apartment 1A, New Rochelle, New York.
The issue in this proceeding is whether District Rent Administrator's
order was warranted.
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 on December 2, 1985 by the tenant's filing
of a rent overcharge complaint, asserting that they formerly living in
Apartment 1B at 96 Cooper Drive (a nearby building of the same building
complex, owned by the same landlord), where they paid $460.00 per month
pursuant to a lease which had a term of from May 1, 1982 to April 30,
1984; that on or about December 1, 1983 they moved from there to Apartment
1A at 92 Cooper Drive; that they signed a lease for that apartment for the
period from December 1, 1983 to November 30, 1985 at the same rent
($460.00 per month), and that their rent was later increased to reflect
the installation of a major capital improvement. The tenants also said
that the prior tenant of Apartment 1A had been paying only $310.00 per
On November 14, 1986 the District Rent Administrator issued order number
WNR85S546R finding that an overcharge had occurred, in that the rent for
the subject tenants upon their taking occupancy of Apartment 1A should
have been established at the prior tenant's rent of $310.00 per month, as
there was no guideline increase in effect at that time. The order
directed the owner to roll back the rent and refund the overcharge in the
total amount of $5,255.00 through October 31, 1986. Treble damages were
The landlord filed an appeal of that order, receiving Administrative
Review Docket Number AL810727RO. On May 30, 1990 the Commissioner issued
DOCKET NO.: FH810200RO
an Order and Opinion under that docket number remanding the proceeding to
the Rent Administrator.
In the May 30, 1990 remand order the Commissioner noted that the landlord
had asserted that the last rent of the prior tenant of Apartment 1A had
been $290.00 (rather than the $310.00 used the Administrator in the
November 14, 1986 order). The Commissioner noted that the $290.00 figure
was supported by documents submitted by the landlord. Accordingly the
proceeding was remanded "for the purpose of recalculating the lawful rent
and for the issuance of a new order determining the issues."
On April 11, 1991 the Administrator issued the order herein under appeal,
using $290.00 as the last rent of the prior tenant and imposing treble
damages on the overcharges collected between December 1, 1983 and November
30, 1985, finding a total overcharge of $14,179.56 through October 31,
1986, including treble damages.
On appeal, the owner states, in substance, that the Commissioner on May
30, 1990 had ordered the District Rent Administrator merely to recalculate
the lawful rent, and the Commissioner did not make a finding that the rent
was $290.00. The owner further states that the District Rent
Administrator recalculated the overcharge instead of the lawful rent and
ordered the owner to pay treble damages to the tenant. The owner quotes
in his appeal from the remand proceeding to the rent administrator, as
"The Commissioner is of the opinion that the
proceeding should be remanded to the Rent
Administrator for the purpose of fully recalculating
the lawful rent in view of the landlord's assertion
and the documents it submits."
. . .
"Ordered that this proceeding be and the same hereby
is remanded to the Rent Administrator for the purpose
of recalculating the lawful rent."
In short, the petitioner asserts that the Administrator should have
recalculated the rent rather than relying on the Commissioner's mention of
$290.00; that imposing treble damages was beyond the scope of the remand;
and that the overcharge, if any, was not willful.
The Commissioner is of the opinion that this petition should be denied.
The Commissioner notes with great interest that the petitioner failed to
quote the next phrase of the second paragraph quoted above, namely: "and
for the issuance of a new order determining the issues." Therefore, the
remand order was clearly broad enough to allow a new determination of all
issues, including the issue of treble damages.
Furthermore, the Commissioner in the prior order did make a finding with
request to the $290.00 rent based on the evidence submitted by the owner.
Indeed the purpose of the remand was to recalculate the rent from $290.00
rather than from the $310.00. Clearly the recalculation of the rent
necessitated the recalculation of the overcharges.
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Section 2506.1 (formerly 71(a)) of the Tenant Protection Regulations
"Any landlord who is found by the Division, after a
reasonable opportunity to be heard, to have collected
any rent or other consideration in excess of the legal
regulated rent shall be ordered to pay to the tenant
a penalty equal to three times the amount of such
excess. If the landlord establishes by a
preponderance of the evidence that the overcharge was
neither willful nor attributable to his negligence,
the Division shall establish the penalty as the amount
of the overcharge plus interest at the rate of
interest payable on a judgment pursuant to Section
5004 of the Civil Practice Law and Rules, and the
order shall direct such a payment to be made to the
Therefore, the burden is on the landlord to prove the overcharge was
neither willful nor negligent. The record is devoid of any such proof.
The amount of guideline/vacancy increases are determined by the guidelines
in effect on the commencement date of the new lease, not those in effect
on the date the prior tenant vacated. The Rent Administrator properly did
not allow guideline/vacancy increases because there were 0%
guideline/vacancy increases when the tenant moved in. While it is true
that the tenants requested a new apartment, the landlord had no right to
raise the rent of apartment 1A at a time when the relevant Rent Guidelines
Order clearly stated that rents could not be raised. Therefore, treble
damages were proper.
THEREFORE, in accordance with the Tenant Protection Regulations and the
Emergency Tenant Protection Act, it is
ORDERED, that this petition be, and the same hereby is denied, and the
District Rent Administrator's April 11, 1991 order be, and the same hereby
JOSEPH A. D'AGOSTA