GA 610292 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. GA 610292 RO

                                          :  DISTRICT RENT OFFICE
           Ralph Langsam Associates,         DOCKET NO. ZCI 610140 R
                                            
                                             TENANT: Allen A. Epps            
              
                            PETITIONER    : 
      ------------------------------------X                             

           ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW


      On January 28, 1992, the above-named petitioner-owner filed a Petition 
      for Administrative Review against an amended order issued on November 
      13, 1991 and reissued January 7, 1992, by the Rent Administrator,       
      92-31 Union Hall Street, Jamaica, New York, concerning the housing 
      accommodations known as 3940 Bronx Boulevard, Bronx, New York, Apartment 
      No. 6L, wherein the Rent Administrator determined that the owner had 
      overcharged 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 issue 
      raised by the administrative appeal.  

      This proceeding was originally commenced by the filing of a rent 
      overcharge complaint by the tenant on September 15, 1988.  The owner was 
      served with a copy of the tenant's complaint.  The owner stated in 
      substance that it was entitled to the vacancy and other allowances 
      provided in Rent Guideline Board Order #18 (hereafter RGBO) above the 
      prior rent of $314.96 which were used in the calculation of the tenant's 
      vacancy lease rent of $374.79 and that there was no overcharge.

      In Order Number ZCI 610140 R, the Rent Administrator established the 
      lawful stabilized rent as $372.48 effective June 15, 1987, determined 
      that the tenant had been overcharged and directed a refund to the tenant 
      of $407.68 including treble damages on overcharges collected on and 
      after April 1, 1984.



      The order, originally issued on November 13, 1991 addressed only to the 
      owner (Nora Association), was amended on January 17, 1992 and addressed 







          GA 610292 RO

      to the Managing Agent for the receiver (Ralph Langsam Associates).

      In this petition, the owner contends in substance that they are the 
      managing agent for the court appointed receiver and have only managed 
      the subject premises since May 8, 1990; the rents collected were 
      obtained from the courts and therefore the overcharge should not be 
      considered willful; treble damages are not warranted and the rent has 
      now been reduced in compliance with the Rent Administrator's amended 
      order which was first served on them January 17, 1992.  Along with the 
      petition, the owner sent a copy of the Court order appointing the 
      receiver issued May 8, 1990.

      In answer to the owner's petition, the tenant stated in substance that
      he objects to the owner's petition and does not understand why DHCR 
      allowed the owner to collect the 7.5% vacancy allowance and 
      supplementary allowance of $15.00 thereby reducing the overcharge from 
      $5,000.00 to $407.68.  Further, he had informed the Rent Administrator 
      on January 18, 1991 of the new managing agent and its address.

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

      Section 2526.1(a)(1) of the Rent Stabilization Code provides that any 
      owner who is found by the DHCR to have collected an overcharge shall be 
      liable to the tenant for treble damages unless the owner establishes by 
      a preponderance of the evidence that the overcharge was not willful, in 
      which case interest shall be imposed.  Section 2526.1(a)(1) also 
      provides that treble damages shall be applied only to overcharges 
      occurring on or after April 1, 1984.

      In the instant case, the managing agent for the receiver, as well as the 
      owner were apprised of this proceeding and the possibility of the 
      imposition of treble damages by the Rent Administrator prior to the 
      issuance of the order, yet submitted no evidence to refute the 
      presumption that the overcharge was willful.  It is noted that this 
      overcharge was not caused by a failure to produce rent records at a 
      judicial sale so that the legal regulated rent could not be established.

      Both the owner and the managing agent for the receiver have failed to 
      documents that it ceased collection of the overcharge or made a refund 
      to the tenant after being notified of the tenant's complaint.

      Neither does the overcharge result from any hypertechnical error 
      specified in DHCR Policy Statement 89-2 on Treble Damages.

      With regard to the tenant's objections stated in their response to the 
      owner's petition, the Commissioner notes that the Rent Administrator 
      correctly applied the increase, vacancy and supplementary allowances 
      provided by RGBO #18 in calculating the lawful stabilized rent for the 
      tenant's vacancy lease commencing June 16, 1987 and subsequently 
      correctly computed the overcharge. 

      Accordingly, treble damages were correctly imposed and the Rent 
      Administrator's order was warranted.


      Because this determination concerns lawful rents only through           
      November 30, 1991, the owner is cautioned to adjust subsequent rents to 
      an amount no greater than that determined by the Rent Administrator's 


          GA 610292 RO

      order plus any lawful increases, and to register any adjusted rents with 
      this order and opinion being given as the explanation for the 
      adjustment.

      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, 
      not in excess of twenty percent per month thereof of the overcharge 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, affirmed.


      ISSUED:



                                                                    
                                      JOSEPH A. D'AGOSTA
                                      Acting Deputy Commissioner





    

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