Court Opinion

ID: 5395156
Source: CourtListenerOpinion
Date Created: 2022-01-08 10:11:35.981337+00
Date Added: 2024-06-11T08:30:21.598123
License: Public Domain

Breitel, J.
(dissenting). I dissent and vote to annul the determination and to remit the matter to the Rent Commission for the purpose of adjusting the rent increases previously granted because of insufficient return on the property.
The fact is that this property is now returning a rental income increased solely on the basis of insufficiency in meeting the minimum return provided for by statute. True it is that the policy of the Rent Commission should not “ freeze ” inefficient methods of operation of residential buildings. But it is equally true that rents, justified only under the so-called “ hardship formula ”, should not remain in effect, if, in fact, the hardship has been removed by eliminating services which were originally the basis for computing excess expenses. To permit any other practice simply means that all the effects of a fraudulent maneuver could be accomplished only because fraud in fact was not established. Moreover, the statute is not to be-administered for' the purpose of penalizing fraud but for the purpose of adjusting equities between landlords ■ and tenants. Consequently, it is immaterial whether the ownership has remained the same, or whether actual fraud is proven. The commission has argued, and cogently, we submit, that if we require it to prove actual fraud before it can control the kind of conversion sought here, it will stimulate widespread abuse of the provisions of the *242statute permitting rent increases for insufficient return on property. It is especially significant that the minimum return has been increased recently from 4% to 6%, thus widening the area of application for these statutory provisions.
I cannot agree that elevator operators are necessarily superfluous in automatic elevators. There still remains an element of protection in elevators while in transit, from intruders and others, in case of fire, and in connection with the mechanical operation of the elevators. On the other hand, there is a virtue of economy and efficiency in automatic elevators even when manned by operators. Some, if not most, of the largest buildings in this city, especially business buildings, have automatic elevators controlled by operators. The fact is that automatic elevators have a number of mechanical devices which render their operation more efficient and simpler than nonautomatic elevators, although both are controlled by operators. Indeed, the automatic elevator is a push-button machine of the twentieth century, reducing to a minimum the necessity for judgment and skill on the part of the operator, but not in practice always eliminating the operator.
For all of these reasons a remission of the matter to the Rent Commission provides the soundest handling. Thus the rents may be adjusted to prevent what would under many circumstances amount to a constructive fraud, and in general, would make actual fraud difficult, if not impossible, to discover.
Cohn and Bebgan, JJ., concur with Dobe, J. P.; Callahan, J., dissents and votes to affirm in memorandum; Beeitel, J., dissents and votes to remit, in opinion.
Order reversed, without costs and the petition granted to the extent of reinstating the order of the local rent administrator.