FI 410221 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.:  FI 410221 RO

                    GIFFUNI BROTHERS,
                                                  DRO DOCKET NO.: ZCI 410202-K
                                                  TENANT:  NEIL LONDON
                                  PETITIONER
          ----------------------------------X                                   


            ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW


          On September 13, 1991, the above-named petitioner-owner filed a 
          Petition for Administrative Review against an order issued on 
          August 9, 1991 by the Rent Administrator, Gertz Plaza, Jamaica New 
          York, concerning housing accommodations known as 353 East 83rd 
          Street, New York, New York, Apartment No. 21D wherein the Rent 
          Administrator determined that the owner had overcharge the tenant.

          The Administrative Appeal is being determined pursuant to the 
          provisions of Section 2526.1 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 
          issues raised by the administrative appeal.

          This proceeding was originally commenced in September 1988, by the 
          filing of a rent overcharge complaint by the tenant.

          In answer to the complaint the owner submitted a complete rental 
          history for the subject apartment from September 15, 1982.

          An examination of the rental history submitted by the owner 
          disclosed that the owner had taken a 15% vacancy allowance 
          effective August 1, 1984 upon the initial occupancy of prior tenant 
          Manturov.  Subsequently the Division of Housing and Community 
          Renewal (DHCR) sent the owner a notice directing it to submit proof 
          that the last vacancy allowance collected for the subject apartment 
          occurred prior to June 30, 1975.  In response the owner stated in 
          substance that pursuant to the Omnibus Housing Act, it was not 












          FI 410221 RO





          required to keep or maintain records for a housing accommodation 
          more then four years prior to the most recent registration.  No 
          rental history prior to September 15, 1982 was submitted.

          In Order Number ZCI 410202 R, the Rent Administrator disallowed the 
          15% vacancy allowance taken as of August 1, 1984 on the basis that 
          the owner failed to submit a rental history to substantiate such 
          allowance and found that primarily due to this factor, a rent 
          overcharge of $17,839.93 had occurred including treble damages. The 
          Rent Administrator in his order mistakenly listed the name of the 
          prior tenant in occupancy from August 1, 1984 to July 31, 1988 as 
          the current tenant but assigned no overcharge for this period.  The 
          correct name of the prior tenant is Manturov.

          In this petition, the owner alleges in substance that it was not 
          required to submit rent records dating back to June 30, 1975 since 
          it had duly registered the subject apartment in 1984 and pursuant 
          to Section 2523.7(c) of the Rent Stabilization Code any owner who 
          has duly registered a housing accommodation with DHCR shall not be 
          required to maintain or produce any records relating to the rental 
          of such accommodation more than four years prior to the initial or 
          most recent annual registration for such accommodations and that in 
          any event the imposition of treble damages was not warranted.

          The Commissioner is of the opinion that this petition should be 
          denied.

          Pursuant to Guideline 15, in effect when prior tenant Manturov took 
          occupancy on August 1, 1984, the vacancy allowances are as follows:

               1)   0% where vacancy allowances totalling 15% or 
                    more have been charged pursuant to provisions 
                    governing new tenancies commencing on or after 
                    July 1, 1979.

               2)   5% where vacancy allowances totalling more 
                    than 0% but less than 15% have been charged 
                    pursuant to provisions governing new tenancies 
                    commencing on or after July 1, 1979.

               3)   10% where vacancy allowances were last charged 
                    pursuant to provisions governing new tenancies 
                    commencing July 1, 1975 through June 30, 1979.



               4)   15% where no vacancy allowances have been 
                    charged pursuant to provisions governing new 






          FI 410221 RO





               tenancies commencing on or after July 1, 1975.

          In the instant case the record establishes that the owner took a 
          15% vacancy allowance as of August 1, 1984, but when asked to 
          submit rent records to prove it was entitled to such increase, 
          failed to do so.  Moreover the information submitted by the owner 
          including a copy of prior tenant Boris Fotin's September 15, 1982 
          lease and a statement by Mr. Fotin dated September 30,1982 indicate 
          that the September 15, 1982 Fotin lease was a vacancy lease.  The 
          owner was entitled to a 15% vacancy allowance as of September 15, 
          1982 pursuant to Guideline 13 then in effect and there is nothing 
          in the record to show that such allowance was not taken.  
          Therefore, the owner would not be entitled to take an additional 
          15% vacancy allowance pursuant to Guideline 15 as outlined above 
          but in fact would not have been entitled to any vacancy allowance.  
          Further while the owner is not obligated to maintain or produce 
          rent records more than four years prior to the initial or most 
          recent annual registration pursuant to Section 2523.7(c), if the 
          owner wants to establish a vacancy allowance pursuant to Guideline 
          15, it must submit the required rental history in order to show 
          entitlement to any claimed vacancy allowance.  If it chooses not to 
          do so it cannot be credited with said vacancy allowance.

          With regard to the owner's contention that the imposition of treble 
          damages was not warranted, Section 2526.1 of the Rent Stabilization 
          Code provides in pertinent part that any owner who is found by the 
          DHCR to have collected a rent or other consideration in excess of 
          the legal regulated rent on an after April 1, 1984 shall be ordered 
          to pay to the tenant a penalty equal to three times the amount of 
          such excess.  If the owner establishes by a preponderance of the 
          evidence that the overcharge was not willful, the DHCR shall 
          establish the penalty as the amount of the overcharge plus interest 
          from the date of the first overcharge on or after April 1, 1984.

          In the instant case, the owner has not submitted sufficient 
          evidence to substantiate its claim that the overcharge was not 
          willful.   The owner took credit for a 15% vacancy allowance 
          claiming in effect that no vacancy allowance had been charged since 
          July 1, 19785 but refused to produce the required rental history to 
          show it was entitled to said 15% increase.  Rather the partial 
          rental history submitted by the owner appears to indicate that a 
          prior vacancy allowance was charged since July 1, 1975.  
          Accordingly, the imposition of treble damages was warranted.

          Because this determination concerns lawful rents only through 
          August 31, 1991, the owner is cautioned to adjust subsequent rents 
          to an amount no greater than that determined by the Rent 
          Administrator's order plus any lawful increases, and to register 












          FI 410221 RO





          any adjusted rents with this order and opinion being given as the 
          explanation for the adjustment.

          This order may, upon the expiration of the period in which the 
          owner may institute a proceeding pursuant to Article Seventy-Eight 
          of the Civil Practice Law and Rules, be filed and enforced in the 
          same manner as a judgment or not in excess of twenty percent per 
          month thereof may be offset 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 for administrative review be, and the 
          same hereby is, denied, and, that the order of the Rent 
          Administrator be, and the same hereby is, modified to list Manturov 
          on the rent calculation chart as the tenant in occupancy from 
          August 1, 1984 to July 31, 1988.  In all other respects the Rent 
          Administrator's order is affirmed.





          ISSUED:

                                                  ------------------------
                                                  JOSEPH A. D'AGOSTA
                                                  Acting Deputy Commissioner
           
             
                                             
    

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