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
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IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO. IC510016RO
: DRO DOCKET NO.DH510027TC
95 RIVER COMPANY TENANT: MICHAEL W. STERN
PETITIONER :
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ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW IN
PART
On March 4, 1994, the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
November 19, 1993, by the Rent Administrator, 92-31 Union Hall
Street, Jamaica, New York, concerning the housing accommodations
known as 230 Riverside Drive, New York, New York, Apt 5N, wherein
the Rent Administrator determined the fair market rent pursuant to
the special fair market rent guideline promulgated by the New York
City Rent Guidelines Board for use in calculating fair market rent
appeals. Because the Rent Administrator's order listed an incorrect
owner's name "H. S. Milton - 95 River Company" rather than "95 River
Company" - the registered owner; and the owner claimed it never
received a copy of the Rent Administrator's order from the DHCR, the
Commissioner deems it appropriate to treat the owner's Petition for
Administrative Review as timely filed. It is further noted that the
manager for the subject premises is Milton H. Sherman rather than H.
S. Milton.
The Administrative Appeal is being determined pursuant to the
provisions of Section 2522.3 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 commenced by the tenant's filing of an
objection to the registration on August 7, 1989 in which the tenant
questioned the fair market rent of the subject apartment.
On April 8, 1993, the owner was served with a copy of the
tenant's objection and afforded an opportunity to submit
comparability data and to list improvements made in the subject
apartment if any. In a response received by the DHCR on May 10,
1993, the owner cited apartment 12N in the subject premises as a
comparable. The owner stated that apartment 12N's rent controlled
tenant had vacated on May 31, 1989 and that the date of the initial
stabilized lease for apartment 12N was September, 1990 at a rental
IC510016RO
of $900.00 per month. The owner had been directed by the DHCR that
the rents of all comparable rent stabilized apartments submitted by
the owner must be accompanied by proof that a DC-2 Notice was served
on the first rent stabilized tenant which was not challenged within
ninety (90) days of receipt thereof or, if challenged, such
challenge has been resolved with an Order and Determination from the
DHCR or that the tenant in occupancy on April 1, 1984 received a
copy of the apartment registration and failed to challenge it within
ninety (90) days of receipt thereof or, if challenged, such
challenge has been resolved by an Order and Determination from the
DHCR. The owner did not submit any of the above information. In
addition, the owner stated that new kitchen equipment including a
stove and refrigerator had been installed in the subject apartment
and submitted copies of invoices to substantiate such contention.
On May 25, 1993, the owner was sent a request for additional
information by the DHCR. Such request directed the owner to submit
the initial lease, DC-2 or RR-1 with certified proof of service for
apartment 12N and to submit proof of payment for the refrigerator
and stove. In a response received on June 4, 1993, the owner
submitted a copy of the lease for apartment 12N effective September
1, 1991 at a rental of $985.50 and copies of the annual apartment
registrations for 1990 and 1991 for apartment 12N together with
proof of service of such registrations. The owner also submitted
copies of invoices in support of its claimed improvements.
In response the tenant stated in substance that his original
refrigerator broke down after a few weeks and he was given another
refrigerator that was not new.
In Order Number DH510027TC, the Rent Administrator adjusted the
initial legal regulated rent by establishing a fair market rent of
$595.93 effective April 1, 1989. The fair market rent was
determined on the basis of the special fair market rent guideline
plus an additional increase of $23.14 for new kitchen equipment
excluding the refrigerator and stove. In addition, the Rent
Administrator found that the tenant had paid excess rent totalling
$32,015.71 and directed the owner to refund such excess rent to the
tenant. The Rent Administrator also noted in her order that the
tenant had vacated the subject apartment effective August 31, 1993.
In this petition, the owner alleges in substance that it did
submit paid invoices and cancelled checks in support of the cost of
the new stove and refrigerator and therefore should have been
allowed a rent increase for these items; and that the Rent
Administrator never requested comparability data from the owner. In
support of its petition, the owner submitted inter alia a copy of
the May 25, 1993 request for evidence from the DHCR directing the
owner to submit evidence regarding apartment 12N in the subject
premises.
The Commissioner is of the opinion that this petition should be
granted in part.
IC510016RO
An examination of the records in this case including the
documentary evidence submitted by the owner discloses that the owner
did submit sufficient evidence in the form of paid invoices to show
it spent $267.39 (including tax) for a new stove and $339.47
(including tax) for a new refrigerator installed when the subject
apartment was vacant immediately prior to occupancy by the tenant
herein. Accordingly the owner is entitled to an additional rent
increase of $15.70 for these items ($267.39 plus $339.47 = $606.86
divided by 40 = $15.17) Adding this to the fair market rent found
by the Rent Administrator - $595.93 (which already includes a rent
increase of $23.14 due to other improvements) gives a fair market
rent of $611.10 effective April 1, 1989 and a total excess rent of
$31,211.70 to be paid to the tenant herein. The Rent
Administrator's order is hereby modified to reflect the above
findings.
With regard to the owner's contention that it was not afforded
an opportunity to submit comparability data, the record shows that
the owner was afforded such opportunity and that the owner cited
Apartment 12N in the subject premises as a comparable.
Pursuant to Section 2522.3(e) of the Rent Stabilization Code,
applicable to fair market rent appeals filed after April 1, 1984,
comparability will be determined based on the following:
(1) Legal regulated rents, for which the time to file a Fair Market
Rent Appeal has expired and no Fair Market Rent Appeal is then
pending, or the Fair Market Rent Appeal has been finally determined,
charged pursuant to a lease commencing within a four year period
prior to, or a one year period subsequent to, the commencement date
of the initial lease for the housing accommodation involved; and
(2) At the owner's option, market rents in effect for other
comparable housing accommodations on the date of the initial lease
for the housing accommodations involved.
In the instant case, the owner did not submit evidence to show
that Apartment 12N cited as a comparable met the requirements listed
above although given two opportunities to do so. The owner never
showed that the rent cited for Apartment 12N was the initial
stabilized rent nor that an initial apartment registration form (RR-
1 form) or a DC-2 form had been served. Rather the owner only
submitted evidence that the annual apartment registration forms had
been served on the tenant in occupancy of Apartment 12N. Therefore
the Rent Administrator correctly did not use any comparability data
in determining the fair market rent of the subject apartment.
In the event the owner does not take appropriate action to
comply within sixty (60) days from the date of issuance of this
order, the tenant may seek to enforce this order by filing an
apropriate action in a court of competent jurisdiction. A copy of
IC510016RO
this order is being sent to the current occupant of the subject
apartment.
The owner is directed to reflect the findings and
determinations made in this order on all future registration
statements, including those for the current year if not already
filed, citing this order as the basis for the change. Registration
statements already on file, however, should not be amended to
reflect the findings and determinations made in this order. The
owner is further directed to adjust subsequent rents to an amount no
greater than that determined by this order plus any lawful
increases.
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, granted in part, and, that the order of the Rent
Administrator be, and the same hereby is, modified in accordance
with this order and opinion. The total amount of excess rent
through August 31, 1993 is $31,211.70 and the fair market rent
effective April 1, 1989 is $611.10.
ISSUED
JOSEPH A. D'AGOSTA
Deputy Commissioner
IC510016RO
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