GF 410210 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.: GF 410210 RO

            50 CARMINE STREET ASSOCIATES,
                                                  DRO DOCKET NO.:  FD 410040 RK
                                                  TENANT:  JOHN BERTRAM
                                  PETITIONER
          ----------------------------------X                                   


            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                                       IN PART


          On June 26, 1992, the above-named petitioner filed a Petition for 
          Administrative Review against an order issued on June 2, 1992 by 
          the Rent Administrator, 92-31 Union Hall Street, Jamaica, New York 
          concerning the housing accommodations known as 50 Carmine Street, 
          New York, New York, Apartment 11, wherein the Administrator 
          determined that the owner had overcharged the tenant.

          The issue herein is whether the order of the Rent Administrator 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 on September 
          30, 1987 by the tenant of an overcharge complaint in which the 
          tenant alleged that the owner had not honored orders, resulting 
          from a previous overcharge complaint and two service complaints, in 
          which the rent was reduced.

          In response to the complaint, the owner stated that a refund of a 
          prior overcharge determined under Docket No. TC 081531 G, had been 
          given to the tenant; the owner requested dismissal of the 
          complaint.

          In an order issued on March 5, 1991 under Docket No. ZBI 410606 R, 
          the Administrator determined that the owner had collected an 
          overcharge of $19,126.59 inclusive of excess security and treble 
          damages.













          GF 410210 RO

          Subsequently, by letter dated April 5, 1991, the owner requested 
          reconsideration.  It was determined that the order had established 
          the rent at an incorrect amount and that the actual rent paid by 
          the tenant had been incorrectly listed; that these errors warranted 
          reopening the proceeding.

          Upon reconsideration, in order No. ZFD 410040 RK, the lawful rent 
          was established at $349.76 effective October 1, 1990 and the 
          overcharge was recomputed to $5,342.83 inclusive of interest on the 
          overcharge collected between November 1984 and September 1985, and 
          treble damages on the overcharge collected thereafter.  The owner 
          was given partial credit for the refund previously given to the 
          tenant.

          In its appeal, the owner contends that the order should be reversed 
          for the following reasons:

               1)   the legal rent as of April 1, 1984 was 
                    incorrectly established at $226.75 whereas the 
                    issue of the legal rent, established at 
                    $263.03 in Docket No. ZTC 081531 G, was res 
                    judicata;

               2)   treble damages should not have been imposed on 
                    any overcharge resulting from the collection 
                    of rent which was in accord with either the 
                    order issued in 1987 or in 1991.  Moreover, 
                    given the varying orders by the Division of 
                    Housing and Community Renewal (DHCR) the owner 
                    was confused (as was the DHCR) as to the 
                    lawful rent; any resulting overcharge should 
                    not be considered willful;

               3)   the partial credit should have been taken into 
                    account before assessing treble damages;

               4)   the tenant was undercharged during various 
                    periods.  The owner should have been credited 
                    with the amounts deliberately undercharged to 
                    offset prior overcharges.

          In response to the appeal, the tenant contends that the owner has 
          consistently ignored DHCR orders and that treble damages are 
          appropriate.  With respect to the owner's alleged confusion, the 
          tenant asserts that the owner should know the law as it relates to 
          rent under the Rent Stabilization Code and it should not have been 
          confused as to the correct rent.  The tenant also contends that the 
          partial credit should have no effect on the assessment of treble 
          damages.  The tenant further contends that no deliberate 
          undercharges were ever made by the owner.  Finally, the tenant 
          contends that treble damages should have been assessed on the 
          entire overcharge complaint in 1984 and that the owner continued to 






          GF 410210 RO

          overcharge even after a determination of the original complaint was 
          made.

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

          It is noted that the legal stabilized rent was established at 
          $263.03 for the period October 1, 1981 through September 30, 1984 
          under Rent Guidelines Board Order No. 13.  Based upon findings 
          under Docket Nos. 83302 P and 83584 B that there had been a 
          reduction in services, the collectible rent was reduced by one 
          Guideline to $226.75 and frozen at that level until the reduced 
          services were restored.  The legal rent should not have been 
          affected by the ordered reduction in rent.

          Accordingly, the Commissioner finds that the legal regulated rent 
          should be:

                    4-1-84                   $263.03

                   10-1-84                   $286.70

                   10-1-86                   $327.50

                   10-1-88                   $356.98

                   10-1-90                   $381.97

          The monthly rent the owner was entitled to collect (collectible 
          rent) was frozen at $226.75 until the rent was restored pursuant to 
          Order No. CI 410145 OR as of November 1, 1988.

          The overcharges to be refunded pursuant to the Administrator's 
          order is amended as follows:

          Period beginning    Rent Charged   Legal Rent          Overcharges
                                             Collectible Rent    Calculations

          6-1-89              $382.16        $356.98             $25.18 X 10 
                                                                 Mos = 
                                                                 $251.80

          6-1-90              $382.16        $356.98             $25.18 X 4
                                                                 Mos = 
                                                                 $100.72


          10-1-90             $408.91        $381.97             $26.94 X 13
                                                                 Mos = 
                                                                 $350.22

          11-1-91             $369.82        $381.97               -0-












          GF 410210 RO


          All remaining overcharge computations (total $892.06) remain in 
          full force and effect.  Therefore, the total overcharge is as 
          follows:

          Overcharge =        $1594.80

          Treble Damages      $2073.20

          Interest            $ 318.95
                              $3986.95

          Partial Credit      $1605.83

          Total Refund due    $2381.12  October 1, 1984 to May 31, 1992

          Section 2526.1 of the Rent Stabilization Code provides for the 
          imposition of treble damages or willful overcharges.

          Pursuant to the Code, an overcharge is presumed willful unless the 
          owner proves by a preponderance of the evidence that the overcharge 
          was not willful.  The instant owner has failed to meet its burden 
          of proof.  The Commissioner notes that it is the policy of the DHCR 
          that a full refund to a tenant before the issuance of an order is 
          deemed to show lack of willfulness. (pursuant to Policy Statement 
          No. 89-2)   The partial credit tendered by the instant owner does 
          not show such a  lack of willfulness.  Accordingly, the 
          Commissioner finds that treble damages were properly assessed on 
          the overcharges collected beginning October 1, 1985.

          Further the Commissioner finds no documentary evidence in the 
          record that the owner deliberately undercharged to offset the 
          overcharge due to be refunded.  

          With respect to the tenant's request for treble damages on the 
          entire overcharge, the Commissioner notes that since the tenant did 
          not file his own petition, his request cannot be considered in this 
          appeal.

          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 by the 
          tenant in the same manner as a judgment or not in excess of twenty 
          percent thereof per month may be offset against any rent thereafter 
          due the owner.

          THEREFORE, in accordance with the Rent Stabilization Law and Code, 
          it is

          ORDERED, that this petition be, and the same hereby is, granted in 
          part and the order of the Rent Administrator be, and the same 
          hereby is, modified in accordance with this order and opinion.






          GF 410210 RO







          ISSUED:

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






    

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