Matter of Snowmass Realty Corp. v State of New York Div. of Hous. & Community Renewal
Annotate this CaseDecided on October 10, 2006
Supreme Court, New York County
In the Matter of Snowmass Realty Corp.
against
State of New York Division of Housing and Community Renewal, Defendant.
102876/06
Sheila Abdus-Salaam, J.
Upon the foregoing papers, it is ordered that this petition is denied.
This Article 78 proceeding challenges respondent's determination that the owner's failure to provide the tenant with a vacancy lease when the tenant rented the apartment deprived the owner of the right to collect any increase in rent, and increased the amount of the overcharge that had been found by the Rent Administrator.
The tenant of 513 West 134th Street, Apartment 3E filed a complaint of overcharge with respondent in October 2004. The Rent Administrator issued an order finding an overcharge on the ground that in the absence of a vacancy lease, the tenant was a month-to-month tenant and the owner was not entitled to a vacancy increase. Treble damages were imposed. However, the Administrator found that the owner had established the cost of improvements to the apartment and was entitled to an increase based upon those improvements.
The owner did not file a PAR but the tenant filed a PAR challenging the Rent Administrator's finding that the owner was entitled to a rent increase based upon improvements made to the apartment. The Commissioner modified the Rent Administrator's order and found that the owner was not entitled to an increase for apartment improvements because the tenant had not been given a lease.
Petitioner has not shown that respondent's determination was arbitrary or lacked a rational basis. As an initial matter, the court rejects petitioner's assertion that it was "ambushed" by DHCR because the agency did not focus on the actual issues raised by the tenant in the PAR- that is, whether the improvements to the apartment had been adequately demonstrated, but that the agency chose to decide the PAR based on the lack of a signed lease without giving the owner any reason to address that issue and explain why there was no lease. While the tenant's submission on the PAR argued that the owner had not adequately documented the purported improvements to the apartment, the tenant also argued that "b]ecause there was no lease, there was no rent stabilization rider given either, so the tenant was not put on notice of the claimed improvements. The fact that there was no stabilization rider given explaining the computation of the rent should bar the claimed increases."(Tenant's PAR, p. 2). Thus, the tenant had in fact [*2]urged both that the owner had not adequately demonstrated that improvements had been made to the apartment, and that the owner should not be entitled to a rent increase in any event based upon the failure to supply a lease. The owner accordingly had notice of this claim made on the PAR and an opportunity to respond.
Furthermore, regarding the owner's assertion that it did not have the chance to explain to the Commissioner the reasons that the lease had not been provided (i.e. that the tenant refused to sign and that she moved into the apartment without authorization), the owner never proffered these explanations to the Rent Administrator and was barred from raising them before the Commissioner (9 NYCRR 2529.6; 985 Fifth Ave. Inc. v. State Div. of Housing & Community Renewal, 171 AD2d 572 [1991], lvdenied
78 NY2d 861 [1991])). Similarly, petitioner may not make submissions and raise arguments in this Article 78 proceeding that were not adduced before the agency (West Village Associates v.State Div. of Housing & Community Renewal, 277 AD2d 111 [2000]). Additionally, the owner did not file a PAR challenging the Rent Administrator's finding that the owner had failed to establish that the overcharge was not willful and that treble damages were warranted. Thus, that issue is not preserved for judicial review (Fanelli v. NYC Conciliation and Appeals Bd., 90 AD2d 756 [1982], affd 58 NY2d 952 [1983]).
Finally, respondent's determination that petitioner was not entitled to rent increases because petitioner had failed to provide the tenant with a lease was rational and consistent with the Rent Stabilization Law and Code (see 9 NYCRR 2522.5; 24 Fifth Avenue Associates v. State Div. of Housing & Community Renewal, 191 AD2d 331 [1993], lv denied 82 NY2d 652 [1993]).
Accordingly, the petition is denied.
ADJUDGED that this proceeding is dismissed.
Dated:J.S.C.
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