IN RE: 508 REALTY ASSOCIATES (2009)

In a proceeding pursuant to CPLR article 78 to review a determination of the Deputy Commissioner of the New York State Division of Housing and Community Renewal dated September 14, 2006, which denied a request for administrative review and confirmed a determination of the District Rent Administrator dated February 1, 2006, awarding the tenant treble damages for rent overcharges, the New York State Division of Housing and Community Renewal appeals from so much of a judgment of the Supreme Court, Kings County (Martin, J.), dated October 19, 2007, as granted the petition, annulled the determination dated September 14, 2006, to the extent of vacating the award of treble damages, and vacated the determination dated February 1, 2006.

ORDERED that the judgment is reversed insofar as appealed from, on the law, with costs, the petition is denied, the determination dated September 14, 2006, is confirmed in its entirety, the determination dated February 1, 2006, is reinstated, and the proceeding is dismissed on the merits.

 The Rent Stabilization Law (Administrative Code of City of N.Y. § 26-501 et seq.) provides that if the New York State Division of Housing and Community Renewal (hereinafter the DHCR) finds that a landlord, after a reasonable opportunity to be heard, has collected an overcharge above the rent authorized for a housing accommodation, the landlord will be liable to the tenant for a penalty equal to three times the amount of the overcharge (see Administrative Code of City of N.Y. § 26-516[a] ).   In a rent overcharge proceeding, it is the landlord's burden to prove, by a preponderance of the evidence, that the overcharge was not willful.   Absent such proof, the landlord will be assessed a treble-damage penalty, payable to the tenant (see Matter of H.O. Realty Corp. v. State of New York Div. of Hous. & Community Renewal, 46 A.D.3d 103, 107, 844 N.Y.S.2d 204;  Matter of Ellis v. Division of Hous. & Community Renewal of State of N.Y., 45 A.D.3d 594, 595, 845 N.Y.S.2d 407;  Matter of DeSilva v. New York State Div. of Hous. & Community Renewal Off. of Rent Admin., 34 A.D.3d 673, 674, 825 N.Y.S.2d 113;  Matter of Ador Realty, LLC v. Division of Hous. & Community Renewal, 25 A.D.3d 128, 140, 802 N.Y.S.2d 190;  Matter of Chu v. New York State Div. of Hous. & Community Renewal, 231 A.D.2d 567, 568, 647 N.Y.S.2d 285).   Moreover, in reviewing a determination made by an administrative agency such as the DHCR, the court's inquiry is limited to whether the determination is arbitrary and capricious, or without a rational basis in the record and a reasonable basis in law (see CPLR 7803[3];  Matter of Pell v. Board of Educ. of Union Free School Dist. No. 1 of Towns of Scarsdale & Mamaroneck, Westchester County, 34 N.Y.2d 222, 356 N.Y.S.2d 833, 313 N.E.2d 321;  Matter of Ellis v. Division of Hous. & Community Renewal of State of N.Y., 45 A.D.3d at 595, 845 N.Y.S.2d 407;  Matter of ATM One, LLC v. New York State Div. of Hous. & Community Renewal, 37 A.D.3d 714, 831 N.Y.S.2d 436;  Matter of Derfner Mgt. Co. v. New York State Div. of Hous. & Community Renewal, 252 A.D.2d 555, 556, 675 N.Y.S.2d 640).  “An agency's interpretation of the statutes and regulations that it administers is entitled to deference, and must be upheld if reasonable” (Matter of ATM One, LLC v. New York State Div. of Hous. & Community Renewal, 37 A.D.3d at 714, 831 N.Y.S.2d 436).

 In this case, the documentation of the rental history of the subject apartment provided by the petitioner landlord-a lease, lease renewal forms, and handwritten, notarized ledger sheets-was riddled with inaccuracies and discrepancies.   Two of the lease renewal forms encompassed the same period, yet listed different rents and purportedly permissible rent increases for the subject apartment.   Moreover, one of the lease renewal forms indicated that it was signed in January 2000, eight months after the term of the renewal lease commenced on May 1, 1999.   In addition, it is undisputed that the apartments in the subject building had not been registered with the DHCR for the five-year period from 2000 through 2004.   Thus, the Supreme Court erred in its determination that the petitioner established, by a preponderance of the evidence, that the overcharge regarding the subject apartment was not willful.   The DHCR's determination with respect to the award of treble damages was not arbitrary and capricious, and had a rational basis in the record and a reasonable basis in law (see Matter of Ellis v. Division of Hous. & Community Renewal of State of N.Y., 45 A.D.3d at 595, 845 N.Y.S.2d 407).

Contrary to the reasoning of the Supreme Court, Matter of Round Hill Mgt. Co. v. Higgins, 177 A.D.2d 256, 575 N.Y.S.2d 842, is not applicable to this case, as the landlord in Round Hill had established, by a preponderance of the evidence, that the rent overcharge was not willful.

The petitioner's contention that an evidentiary hearing was required is without merit (see Matter of DeSilva v. New York State Div. of Hous. & Community Renewal, 34 A.D.3d at 674, 825 N.Y.S.2d 113;  Matter of Richter v. New York State Div. of Hous. & Community Renewal, 204 A.D.2d 648, 614 N.Y.S.2d 227;  Matter of Rubin v. Eimicke, 150 A.D.2d 697, 698, 541 N.Y.S.2d 570;  Matter of Plaza Realty Invs. v. New York City Conciliation & Appeals Bd., 110 A.D.2d 704, 487 N.Y.S.2d 607).

The DHCR properly relied, in part, on a 1993 rent reduction order in determining the lawful rent for the subject apartment (see Jenkins v. Fieldbridge Assoc., LLC, --- A.D.3d ----, 877 N.Y.S.2d 375, 2009 N.Y. Slip Op. 02751, 2009 WL 943901 [2d Dept. 2009];  Matter of Condo Units v. New York State Div. of Hous. & Community Renewal, 4 A.D.3d 424, 425, 771 N.Y.S.2d 380;   Raffo v. McIntosh, 3 Misc.3d 127(A), 2004 WL 906582;  see also Matter of Ador Realty, LLC v. Division of Hous. & Community Renewal, 25 A.D.3d at 136-138, 802 N.Y.S.2d 190).

The parties' remaining contentions are without merit.