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IN RE: the Application of MACOMBS PLACE LLC, Petitioner, For a Judgment Pursuant to Article 78 of the Civil Practice Law and Rules, v. NEW YORK STATE DIVISION OF HOUSING AND COMMUNITY RENEWAL, and Miladys Flores, Respondents.
This Article 78 proceeding was commenced by Macombs Place LLC (Petitioner), the owner of a rent stabilized housing accommodation known as apartment 3H located at 1485 Macombs Road, Bronx, New York, (subject apartment). The tenant residing in the subject apartment is Miladys Flores (Tenant). This proceeding is brought in the nature of certiorari pursuant to CPLR 7803(3). The New York State Division of Housing and Community Renewal (DHCR) opposes this Article 78 petition.
Petitioner alleges that DHCR has acted in an arbitrary and capricious manner by denying its Petition for Administrative Review (PAR), Order Dkt. GU-610019-RO issued by Deputy Commissioner Woody Pascal on November 15, 2019, which affirmed the Rent Administrator's order dated August 9, 2018 issued under Dkt. No. FW-610329-S. The Rent Administrator's order determined that the Petitioner failed to maintain required services by the removal of a wall partition which resulted in the Tenant's loss of a bedroom, decreasing the number of rooms in the subject apartment from 4 rooms to 3 rooms. The Rent Administrator directed that the legal egulated rent be reduced to the level in effect prior to the most recent guideline increase for the Tenant's lease which commenced before the effective date of the Rent Administrator's order.
The Rent Administrator's order directed that no other rent increases may be collected until a rent restoration order is issued by DHCR. The order stated that if the Petitioner cannot legally re-install the partition, the Petitioner may file an application to modify the service with DHCR. The order further stated that if the Petitioner's application for modification of services is granted, the Petitioner may file an application to restore the rent.
Tenant argues that in or about July 2017, the Petitioner removed the partition in the living room thereby reducing the number of bedrooms by one. The Tenant contends that the rent registration records for the subject apartment indicate that the subject apartment contained 4 rooms. Petitioner argues that, notwithstanding the prior rent registration statements filed by the Petitioner and prior Owner, a major capital improvement (MCI) order issued on February 9, 2012 indicated that the subject apartment contained three rooms and that order should provide sufficient proof that the subject apartment had three rooms.
The Petitioner further argues that as the Tenant did not challenge the room count on the MCI application and order, no subsequent challenge to that count can be raised by the Tenant. Contrary to the Petitioner's contention, the doctrine of issue preclusion does not apply. “Collateral estoppel, or issue preclusion, precludes a party from relitigating in a subsequent action or proceeding an issue that was raised in a prior action or proceeding and decided against that party” or those in privity (see Parker v Blauvelt Volunteer Fire Co., 93 NY2d 343 [1999]). Here, the issue in this case is whether the removal of a partition wall, which eliminated a bedroom resulted in a decrease in service to the Tenant. The issue in the MCI proceeding was whether the petitioner was entitled to a building-wide rent increase based on performing an MCI consisting of painting to the building exterior and windowsills. The issue to be determined in this Article 78 proceeding is very different from the issues presented in the MCI proceeding. As such, the 2012 MCI does not preclude a finding of a reduction in services.
Petitioner contends that DHCR ignored its documentary submission which indicated that the apartment contained only three rooms when it was rented. Notably, there is no support in the record for the Petitioner's claim that the DHCR ignored its documentary submissions. There is no dispute that the number of rooms was reduced by the Petitioner's action. Also, while the Petitioner alleged that the removal of the partition was to ensure that the apartment configuration was in legal compliance, no allegation was made by the Petitioner that the Tenant partitioned the apartment.
Petitioner also suggests that a hearing should have been conducted. The administrative record, however, raised no issues of fact that could not be resolved based on the documents submitted. Petitioner failed to submit any evidence to rebut the Tenant's claim of a loss of a room. “[D]ue process requires that reasonable notice be afforded to the parties to a proceeding and that they have an opportunity to present their objection (see, Matter of Rubin v Eimicke, 150 AD2d 697, 541 N.Y.S.2d 570). Accordingly, a hearing was not necessary to resolve the application.
In an Article 78 proceeding, “the issue is whether the action taken had a rational basis and was not arbitrary and capricious” (Ward v City of Long Beach, 20 NY3d 1042, 1043, 962 NYS2d 587 [2013]). “An action is arbitrary and capricious when it is taken without sound basis in reason or regard to the facts” (id.). “If the determination has a rational basis, it will be sustained, even if a different result would not be unreasonable” (id.). “Arbitrary action is without sound basis in reason and is generally taken without regard to the facts” (Matter of Pell v Board of Educ. Of Union Free Sch. Dist. No. 1 of Towns of Scarsdale & Mamaroneck, Westchester County, 34 NY2d 222, 231, 356 NYS2d 833 [1974]). The administrative agency charged with enforcing a statutory mandate has broad discretion in evaluating pertinent factual data and inferences to be drawn therefrom, and its interpretation will be upheld so long as not irrational or unreasonable (see Matter of Wembly Mgt. Co. v New York State Div. of Hous. & Community Renewal, 176 AD2d 518, 520, 574 N.Y.S.2d 709 [1991]). Here, the determination that Petitioner's removal of the partition reducing the rooms in the subject apartment constituted a failure to maintain required services had a rational basis in the record. In this instance, that determination was based on evidence submitted in the record and was not contrary to reason.
This Court finds that the determination of the DHCR had a rational basis and should not be disturbed.
Accordingly, it is
ADJUDGED that the petition is denied, and the proceeding is dismissed.
Adrian N. Armstrong, J.
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Docket No: 260029 /2020
Decided: April 14, 2021
Court: Supreme Court, Bronx County, New York.
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