New York City, N.Y., Code 26-514, New York City, N.Y.

, Code 26-514

New York City, N.Y., Code 26-514 NEW YORK CITY CHARTER, CODE, AMENDMENTS & RULES NEW YORK CITY ADMINISTRATIVE CODE TITLE 26. HOUSING AND BUILDINGS CHAPTER 4. RENT STABILIZATION.

The Currency up to Local Law 29 of 2011 and Chapters 1 - 97 of the Laws of the State of New York for 2011.

The Currency up to Local Law 29 of 2011 and Chapters 1 - 97 of the Laws of the State of New York for 2011. 26-514. Maintenance of services. In order to collect a rent adjustment authorized pursuant to the provisions of subdivision d of section 26-510 of this chapter an owner must file with the state division of housing and community renewal, on a form which the commissioner shall prescribe, a written certification that he or she is maintaining and will continue to maintain all services furnished on the date upon which the emergency tenant protection act of nineteen seventy-four becomes a law or required to be furnished by any state law or local law, ordinance or regulation applicable to the premises. In addition to any other remedy afforded by law, any tenant may apply to the state division of housing and community renewal, for a reduction in the rent to the level in effect prior to its most recent adjustment and for an order requiring services to be maintained as provided in this section, and the commissioner shall so reduce the rent if it is found that the owner has failed to maintain such services. The owner shall also be barred from applying for or collecting any further rent increases. The restoration of such services shall result in the prospective elimination of such sanctions. The owner shall be supplied with a copy of the application and shall be permitted to file an answer thereto. A hearing may be held upon the request of either party, or the commissioner may hold a hearing upon his or her own motion. The commissioner may consolidate the proceedings for two or more petitions applicable to the same building or group of buildings or development. If the commissioner finds that the owner has knowingly filed a false certification, it shall, in addition to abating the rent, assess the owner with the reasonable costs of the proceeding, including reasonable attorneys fees, and impose a penalty not in excess of two hundred fifty dollars for each false certification. The amount of the reduction in rent ordered by the state division of housing and community renewal under this subdivision shall be reduced by any credit, abatement or offset in rent which
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the tenant has received pursuant to section two hundred thirty-five-b of the real property law, that relates to one or more conditions covered by such order. HISTORICAL NOTE Section amended chap 116/1997 42, eff. June 19, 1997 and applies to pending and subsequent actions and proceedings. Section added chap 907/1985 1 DERIVATION Formerly YY51-6.0.3 added chap 576/1974 12 Amended chap 403/1983 13 CASE NOTES FROM FORMER SECTION 1. Apt. had been rented unfurnished, prior to the base rent date, at the same rate as established for the apt. as furnished on July 1, 1974, and there was thus no requirement for a rollback of rent when the apt. was subsequently rented as unfurnished. There are no provisions for establishing the value of furnishings in an apt. for such purposes.--Paul Chessin v. N.Y.C. Conciliation and Appeals Bd., 116 Misc. 2d 1003 [1982]; reversed 100 AD2d 297 [1984]. CASE NOTES 1. Order to reduce rent based upon decrease in services following complaint of no live-in superintendant, inadequate janitorial service, garbage accumulation. Administrative agency responsible to reduce rent changed from Conciliation and Appeals board (CAB) to State Division of Housing and Community Renewal per NYC Ad Cd 26-514 [YY51-6.0.3] as amended Ch 403/1983. Such transfer of responsibility does not affect statutory authority to reduce stabilized rent. Matter of E. 52nd St. Assocs. v. State Div. of Hous. & Comm. Renewal, 131 AD2d 348 [1987]. 2. Owner of apartment complex failed to maintain a new security system which included removal of preexisting outer door locks on each building. DHRC erred in failing to order a rent reduction because of a diminuation of require service, 26-514. Hyde Park Gardens v. DHCR, Off. of Rent Admin., 140 AD2d 351 affirmed 73 NY2d 998 [1989]. 3. Tenant may not consent to rent restoration nor may DHCR order rent restoration until the underlying defect is cured, in this case master bedroom ceiling was repaired in an
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unworkmanlike manner displaying blisters and water stains. Administrative Code 26-514 provides tenant may apply for reduction to prior level rent and DHRC shall so reduce rent if owner has failed to maintain service. DHRC has no discretion and agencys denial of partial restoration of rent is correct. ANF Co. v. DHCR, 176 AD2d 518, 574 N.Y.S.2d 709 [1991]. 4. DHRC ordered rent reduction in an amount of all rent increases until a date when services were restored and ordered refund of major capital improvement rent increases for all tenants for same period. Rent reduction is not denial of due process. In addition to financial incentive for landlords to maintain services, Administrative Code 26-514 provides remedy for tenants who have paid rent increases during periods of decreased services. While petitioners were free to use judicial process, tenants should not suffer because petitioners did not restore services until all appeals were exhausted. Mortgage holders--Intervenors cross claim is not permitted in special proceedings absent leave of court. Hyde Park Assocs. v. Higgins, 191 AD2d 440, 594 N.Y.S.2d 57 (2nd Dept. 1993). 5. Nasaw v. Jemrock Realty Co., Inc. 639 N.Y.S.2d 37 (App.Div. 1st Dept. 1996). Although the New York State Division of Housing and Community Renewal does not have exclusive jurisdiction with respect to the maintenance of service, court action in a landlord-tenant dispute should be stayed until a final determination is made by the agency, which has special competence to deal with the issues involved. 6. Where the state agency had a rational basis for its determination reducing the rent by reason of the landlords failure to maintain required services, the finding will not be disturbed by the court. Newport Management Co. v. New York State Division of Housing and Community Renewal, 540 N.Y.S.2d 989 (2nd Dept. 1989). 7. If a services complaint is sustained, the agency should reduce the rent to the level which was in effect prior to the most recent guidelines increase. However, the landlord can still get a vacancy allowance and rent increases attributable to improvements made to the vacant apartment. Graham Court Owners v. Allen, N.Y.L.J., Mar. 19, 1996, page 25, col. 2 (App.Term 1st Dept.). 8. It is for the administrative agency to determine what constitutes a required service and whether such services are being properly maintained. The court affirmed the agencys rent reduction here. The agency reasonably relied on a report of its inspector indicating that the water pressure was too low. Melohn v. New York State Division of Housing and Community Renewal, 234 A.D.2d 23, 650 N.Y.S.2d 166 (App.Div. 1st Dept. 1996). 9. Where a landlord is ordered to reinstitute services at its building and fails to do so, but fails to do so, the agency can impose civil penalties. It is not necessary to establish that the violation was willful. Matter of David Frankel Realty Co., Inc. v. New York State Division of Housing and Community Renewal, 176 A.D.2d 617, 575 N.Y.S.2d 59 (1st Dept. 1991).
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10. An adverse change in storage facilities available to tenants can constitute an impermissible reduction in services within the meaning of the statute. Originally, the tenants had each been provided with individually locked storage bins in the basement. This was replaced with a common storage area (to which the building superintendent provided access), which provided less security. Matter of Waterside Management v. New York State Division of Housing and Community Renewal, N.Y.L.J., July 29, 1998, page 24, col. 6 (Sup.Ct. Queens Co.). 11. Where an impartial DHCR inspector found that the tenants refrigerator had an abnormal freezer and refrigerator temperature, and there were improperly installed gaskets, this confirmed the tenants complaint of a malfunctioning refrigerator and justified a rent reduction. Simkowitz v. DHCR, 251 A.D.2d 5, 673 N.Y.S.2d 647 (App.Div. 1st Dept. 1998). 12. In one case, an agency inter-office memorandum stated that certain conditions would be considered de minimus in nature and not rise to the level of decreases in services. One of the listed conditions was the removal of storage space, unless a specific lease rider is provided to tenants allowing storage space or unless formal storage boxes or bins were provided within three years of the filing of the complaint. The court held, in effect, that when adjudicating tenant complaints of reduced services, DHCR must consistently apply its own regulations. Thus, where part of the tenants complaints related to reduction in storage space, the agency had to take into account the owners claims that it had never authorized the tenants to use that storage space, and the fact that the registration statement had not listed storage space as one of the available services. Since the agencys decision did not address the impact of this inter-office memorandum, the court remanded the matter to the agency for further consideration. Hakim v. DHCR, 273 A.D.2d 3, 708 N.Y.S.2d 112, leave to appeal dismissed, 95 N.Y.2d 887, 715 N.Y.S.2d 378 (2000). 13. In one case, a court upheld an agency determination that a garage space was a required service, even though the majority of spaces in the garage were used by non-residents of the building and the garage was constructed after the tenant took occupancy. The important factors in favor of the agency determination were that the building and garage were under common ownership, that a portion of the garage was in the building, and that tenants were able to obtain access to the garage directly from the building. Lyndonville Properties v. DHCR, N.Y.L.J., Feb. 23, 2000, page 29, col. 2 (Sup.Ct. New York Co.). 14. A persistent failure of the owner to deal with a leakage problem of long standing (more than ten years in this case) cannot be considered de minimis, and the landlords application for an order restoring rents was denied. Cadillac Leasing, L.P. v DHCR, N.Y.L.J., June 7, 2000, page 32, col. 1 (Sup.Ct. Queens Co.). 15. Normally, where the premises have been rent stabilized for a period of time, and DHCR is reducing the rent by reason of the landlords failure to maintain required services, the rent is reduced by one guidelines increase. However, what happens if the tenants lease is the first
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stabilized lease, and there has not been any previous guidelines increase. The Appellate Term, Second Department, held that in such a case, the rent is to be reduced to the level of the last rent controlled rent. Lorcorp, Inc. v. Burke, 185 Misc.2d 720, 713 N.Y.S.2d 891 (App.Term 2d Dept. 2000). Thus, the Second Department disagreed with a prior decision of the Appellate Term, First Department in Graham Court Owners Corp. v. Allen, N.Y.L.J., Mar. 19, 1996, page 25, col. 2, in which the court did not roll the rent back to the rent controlled level but merely reduced the rent by one guidelines increase. 16. The court upheld a DHCR rent reduction order imposed after the Department of Buildings shut down the elevator after bricks and plaster were falling into it. 780 P.P. Assocs. v. DHCR, N.Y.L.J., Feb. 4, 2002, page 19, col. 2 (App.Div. 1st Dept.). 17. The determination of the rent agency to reduce rent by reason of the owners failure to supply heat for one and a half months in the winter was upheld by the court as having a rational basis. An inspection by the New York City Dept. of Housing Preservation and Development (HPD) had revealed violations relating to heat, and the violation had not been remedied until after the rent reduction order had been issued and after the agency-imposed deadline for the owners response to the tenants complaint had passed. In Re 301 West 11th Street Owners Corp. v. New York State Div. of Housing and Community Renewal, 7 A.D.3d 282, 776 N.Y.S.2d 55 (1st Dept. 2004). 18. Where a tenant had been permitted to use a laundry and a backyard area for the first six years of the tenancy, and the landlord then eliminated such uses, the landlord was deemed to have reduced services. Thus, DHCR acted reasonably in granting the tenant a reduction in rent. Llorente v. DHCR, 16 A.D.3d 105, 792 N.Y.S.2d 20 (1st Dept. 2005). 19. In one case, the a tenant contended that he was entitled to use the backyard because he had already used it for an extended period of time without a written lease prohibiting this action. However, as the court viewed this situation, the relevant issue was whether access to the backyard was a required service within the rent stabilization laws coverage. The tenant admitted that his only access to the yard was through a window. According to the court, this belied the tenants inference that this was a service provided by the landlord. Moreover, the landlord and superintendent testified that the tenant was repeatedly told not to use the backyard. The tenant contended that he should have been provided a lease permitting use of the backyard; the court said that if that was the claim, the tenant should have brought a separate proceeding seeking a lease. Furthermore, the court said that even if the tenant had a lease for the premises, the result would be the same unless the lease expressly provided for or excluded use of the yard. Thus, the court held that the agency had a rational basis for determining that the backyard was not a required service. Meirowitz v. NYS Div. of Housing and Community Renewal, 28 A.D.3d 350, 814 N.Y.S.2d 56 (1st Dept. 2006), leave to appeal denied, 7 N.Y.3d 718, 2006 WL 3716795 (2006).

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