GE 410059 RO
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 : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO. GE 410059 RO
: DISTRICT RENT OFFICE
Metropolitan Life Ins. Co., DOCKET NO. ZDK 410403 R
TENANT: Milton Lewis
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On May 12, 1992, the above-named petitioner-owner filed a Petition for
Administrative Review against an order issued on April 10, 1992, by the
Rent Administrator, 92-31 Union Hall Street, Jamaica, New York,
concerning the housing accommodations known as 431 East 20th Street,
New York, New York, Apartment No. 3B, wherein the Rent Administrator
determined that the owner had overcharged the tenant.
The Administrative Appeal is being determined pursuant to the provisions
of Section 2520.13; 2525.2(a) and 2526.1 of the Rent Stabilization Code
The issue herein is whether the Rent Administrator's order was
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 in November, 1989, stating in
substance that the owner is collecting an additional fee for use of
electricity for a frost-free refrigerator effective September 1, 1988
whereas the manual defrost model, whose electrical costs are included in
the apartment's rent, is much less cost efficient than the frost-free
model. Electricity is included in the rent of the subject apartment.
The owner was served with a copy of the tenant's complaint and stated in
substance that the tenant had signed an agreement to pay for the
increased electrical costs which a frost-free model incurs; that despite
the tenants claims of increased cost efficiency, a frost free model is
more costly to operate and that their collection of a fee was authorized
and affirmed by the Commissioner in a prior opinion ARL 08584-L
involving another tenant in the complex.
In Order Number ZDK 410403 R, the Rent Administrator determined that the
tenant had been overcharged and directed a refund to the tenant of
GE 410059 RO
$825.89 including interest for the additional electrical fee collected
by the owner in violation of section 2525.1 of the code. The owner was
directed to cease billing the tenant for the use of the frost-free
refrigerator but also advised of its right to have the tenant remove his
frost-free refrigerator and allow the owner to replace it with a
refrigerator comparable to the one supplied on the base date.
In this petition, the owner contends in substance that the Rent
Administrator's order should be reversed because the tenants had
voluntarily entered into the agreement to pay the additional electrical
costs for the frost free model; that contrary to manufacturer's claims
presented by the tenant, a frost-free model is not more cost efficient
than a manual defrost; that the service of allowing the tenant's frost
free model is not a service provided on the applicable base date nor
thereafter by applicable law and is not therefore subject to the Rent
Stabilization Law and that the Commissioner is bound by his ruling in
the prior opinion ARL-08584-L which affirmed the owner's right to
collect an increase for electrical costs associated with the use of a
frost-free refrigerator pursuant to a tenant's consent agreement.
In answer to the owner's petition, the tenant stated in substance that
the data on the cost efficiency of their frost-free model was provided
by Con Edison and Consumer Reports, not manufacturer's claims as the
owner alleges; that currently the owner offers tenants a frost free
model at a $9.87 monthly fee thereby conceding the efficiency of the
frost free model over the manual; that they were forced to buy and
maintain their own frost-free refrigerator as well as paying almost
double in electrical fees and further they had to pay a $50.00 storage
for their former 30 year old model which is an absurd charge.
The Commissioner is of the opinion that this petition should be denied.
Sections 2525.1 and 2525.2(A) of the RSC provide in pertinent part that,
regardless of any contract or agreement, it is unlawful for the owner to
collect rent in excess of the legal regulated rent or to evade the
requirements of the code by obliging tenants to pay additional fees or
by modifying the services furnished or required to be furnished.
section 2520.13 of the RSC provides in pertinent part that any tenant
agreement waiving any of the rights provided to the tenant by the RSC is
void and not binding on the tenant.
An examination of the record in this case discloses that the Rent
Administrator correctly applied Sections 2525.1 and 2525.2(a) and
Section 2520.13 of the code because there exists no provision in either
the Rent Stabilization Law or Code or Rent Guidelines Board orders
authorizing the imposition of a supplementary fee above the lawful
stabilization rent to offset an increase for the use of a frost-free
refrigerator rather than a manual-defrost model even though the costs of
electricity are included in the rent.
Moreover, the signed consent by the tenants to pay the additional fee
does not in itself authorize such collection because the provisions of
Section 2520.13 of the Code renders such an agreement as not binding on
the tenants who do not waive their rights under the Rent Stabilization
GE 410059 RO
Law and Code.
Furthermore, the Rent Administrator distinguished between the instant
case and the Commissioner's prior opinion ARL-08584-L, cited by the
owner in its response to the tenants complaint and in its appeal, by
noting that the issue before the Commissioner in the cited case was the
lawfulness of electrical surcharges for air conditioner usage in an
electrical inclusion building. The existence of a separate agreement by
the tenant to pay a supplementary fee for a frost-free refrigerator was
solely noted by the Commissioner to clarify that the total fee collected
by the owner was not a fee in excess of the permissible air conditioner
fee and that the tenants in that case, unlike the tenants in the instant
case, did not challenge the collection of the electrical surcharge for
the frost-free refrigerator. The Commissioner made no ruling concerning
the merits of an electrical surcharge fee for the use of a frost-free
refrigerator in ARL 08584-L.
Therefore, the Rent Administrator correctly determined that the owner's
reliance upon ARL 08584-L was misplaced. However, the Rent
Administrator conceded that the owner's reliance upon the Commissioner's
prior opinion successfully rebutted the presumption of willfulness
warranting only the assessment of interest rather than treble damages
upon the ensuing overcharge.
The owner's contention that the electrical supplement fee for frost-free
refrigerator use should be construed as a new service, not required to
be provided after the applicable base date and therefore outside the
purview of the Rent Stabilization Law and Code is rejected as without
Section 2520.6(R)(1) of the RSC clearly defines required services as not
only those maintained on the applicable base date but also "...any
additional space or service provided or required to be provided
thereafter by applicable law..." (emphasis added)
Further, he Commissioner will not consider the merits of the tenant's
contention that a $50.00 fee was assessed by the owner for storage of
the old refrigerator, as this is not a de novo proceeding and the issue
was not presented before the Rent Administrator. In addition, having
fail to file their own petition against the Rent Administrator's order,
it would be inappropriate to consider the tenant's contention in this
proceeding brought by the owner.
Accordingly, the Rent Administrator's order was warranted.
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 remaining
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.
GE 410059 RO
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner