FF 410141 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. FF 410141 RO

                 Solil Management Corp.,         DRO DOCKET  NO.  ZL003751R
                  
                                                 TENANT:    Rita     Halley
                                     PETITIONER    
          ------------------------------------X 

           ORDER AND OPINION GRANTING IN PART PETITION FOR ADMINISTRATIVE 
                                       REVIEW
                                          
          On December 20, 1990, the above-named  petitioner-owner  filed  a
          Petition for Administrative Review against  an  order  issued  on
          November 30, 1990, by the Rent Administrator,  92-31  Union  Hall
          Street, Jamaica, New York, concerning the housing  accommodations
          known as 145 East 16th Street, New York, New York, Apartment  No.
          8N, wherein the Rent Administrator  determined  that  the  tenant
          had been overcharged in the amount of $6,541.72.

          The Administrative Appeal is being  determined  pursuant  to  the
          provisions of Section 2522.4 of the Rent Stabilization Code.

          The issue herein is whether the 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 issue raised by the administrative appeal.  

          The tenant originally commenced this proceeding on September  11,
          1985 by filing  a  complaint  of  rent  overcharge.   The  tenant
          alleged in substance that 1) the owner had not  provided  a  rent
          history rider with the lease;  2)  the  owner  had  not  provided
          copies of bills for appliances  installed  prior  to  her  taking
          occupancy;  3)  the  owner  had  incorrectly   incorporated   the
          appliance charge, $25.50, into the base rent.

          The owner was served  with  a  copy  of  the  complaint  and  was
          directed to submit  a  complete  rent  history.   The  owner  was
          advised that if it claimed a rent increase for  the  installation
          of new equipment, it was required to submit invoices showing  the
          cost and date of installation.

          In answer, the owner submitted a rental history from June 1, 1981 
          and invoices and cancelled checks which substantiated the cost of 
          three appliances installed in the subject  apartment  before  the
          tenant took occupancy.
          In reply, the tenant asserted inter alia that absent her consent, 
          an appliance charge should not have been added to the rent.

          In the order issued on November 30, 1990, the Administrator found 






          FF 410141 RO
          that although  the  owner  had  substantiated  the  cost  of  the
          appliances, the cost of new equipment installed during a  vacancy
          period must be  added  to  the  tenant's  vacancy  lease  at  the
          beginning of that lease.  Since the owner herein first  began  to
          collect the appliance cost  one  month  after  the  lease  period
          began,  and  the  tenant  had  not  given  written  consent,  the
          Administrator determined that the owner  had  improperly  imposed
          the appliance cost as rent and further determined that the  owner
          had collected an overcharge  of  $6,541.72  inclusive  of  excess
          security and treble damages.

          On appeal, the owner states that although the new appliances  had
          been installed during the vacancy period  making  tenant  consent
          unnecessary, it had delayed in charging for them because  it  was
          uncertain  of  the  exact  amount  to  charge  until  after   the
          initiation of the lease term.  The owner contends that the  lease
          provides for rent adjustments but the clause  cited  pertains  to
          adjustments made pursuant to rent  guidelines.   The  owner  also
          asserts that assuming for the sake  of  argument,  there  was  an
          overcharge, the facts of  the  instant  case  do  not  support  a
          finding of wilfulness within the  meaning  of  the  Code  section
          which provides for treble damages.

          In response, the tenant reiterated her belief that the owner  had
          wilfully overcharged and  the  Administrator's  order  should  be
          upheld.

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

          Section 2522.4(a)(1) of the Rent Stabilization Code authorizes  a
          rent  increase  for  the  installation  of   new   equipment   or
          improvements "on written tenant consent to the rent increase.  In 
          the case of vacant housing accommodations  tenant  consent  shall
          not be required."  Subdivision (4) of this section provides  that
          the  increase  shall  be  1/40th  of  the  total  cost  including
          installation and subdivision (5) states that the increase may  be
          collected "upon installation."

          It is undisputed that new appliances were installed and that  the
          installation occurred prior to the  complainant's  occupancy  and
          while the apartment was vacant.  Accordingly, the owner  did  not
          need the tenant's consent for the installation and  was  entitled
          to add 1/40th of the total cost to the vacancy rent.   The  owner
          was  not  required  to  present  the  bills  to  the  tenant   to
          substantiate the cost of the appliances.  The amount charged  was
          subject  to  review  only  in  the  context  of   an   overcharge
          proceeding; when the tenant did file  her  complaint,  the  owner
          submitted  invoices   and   cancelled   checks   documenting   an
          expenditure of $1067.07 for appliances for which an  increase  of
          $26.68 could have been charged if the owner had included a clause 
          in  the  tenant's  vacancy  lease  advising  the  tenant  of  the
          installation and that a rent increase would  be  taken  when  the
          owner had determined the exact amount of such increase.

          However, the  owner  failed  to  preserve,  through  the  use  of
          appropriate language in the vacancy lease, its right  to  collect
          the increase when the amounts were known.  Accordingly, the owner 
          is deemed to  have  waived  the  rent  increase  based  upon  the






          FF 410141 RO
          installation of new equipment since the owner is limited  to  the
          amount of rent listed  in  the  vacancy  lease.   Therefore,  the
          Commissioner  finds  that  the  Administrator  did  not  err   in
          determining  that  an  overcharge  had  occurred.   However,  the
          Commissioner finds that treble damages are  not  warranted  since
          the overcharge only resulted due to the owner's failure  to  list
          improvements made in the  tenant's  vacancy  lease.   It  is  the
          Commissioner's opinion that pursuant to  Policy  Statement  87-2,
          the owner has shown that this overcharge was not willful.  

          Accordingly, the Commissioner has recalculated the overcharge  to
          include interest instead of treble damages:

          10/1/84 - 8/31/85   $25.50 x 11 mos. + interest =      $280.50
                                                                 $145.16
                                                                         
                                                                 $425.66

          9/1/85  - 8/31/87   $27.79 x 24 mos. + interest =      $666.96
                                                                 $257.61
                                                                         
                                                                 $924.57

          9/1/87  - 8/31/89   $30.29 x 24 mos. + interest =      $726.96
                                                                 $149.94
                                                                         
                                                                 $876.90

          9/1/89 - 11/30/90   $33.01 x 15 mos. + interest =      $495.15
                                                                 $ 29.72
                                                                         
                                                                 $524.87

          Total overcharges through 11/30/90 =                  $2752.00
                     excess security                               33.01
                                                                          
                                                                $2785.01

          Based on the foregoing, a total overcharge of  $2785.01  occurred
          from October 1, 1984 to November 30, 1990 including  interest  on
          the overcharge occurring on and after April 1,  1984  and  excess
          security.

          Because this determination concerns  lawful  rents  only  through
          November 30, 1990, the owner is cautioned  to  adjust  subsequent
          rents to an amount no greater than that determined by this  order
          plus any lawful increases.

          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  per  cent  month
          thereof may be off set against any rent thereafter due the owner.

          THEREFORE,  in  accordance  with  the  provisions  of  the   Rent
          Stabilization Law and Code, 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






          FF 410141 RO
          hereby is modified in accordance with this order and opinion.

          ISSUED:

                                                                      
                                          JOSEPH A. D'AGOSTA
                                          Acting Deputy Commissioner




                     
































    

TenantNet Home | TenantNet Forum | New York Tenant Information
DHCR Information | DHCR Decisions | Housing Court Decisions | New York Rent Laws
Disclaimer | Privacy Policy | Contact Us

Subscribe to our Mailing List!
Your Email      Full Name