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01/07/91 SUSAN HANSON v. DISTRICT COLUMBIA RENTAL

January 7, 1991

SUSAN HANSON, ET AL., PETITIONERS
v.
DISTRICT OF COLUMBIA RENTAL HOUSING COMMISSION, RESPONDENT; JO FREEMAN, INTERVENOR; JO FREEMAN, APPELLANT V. VICKI FOXWORTH, ET AL., APPELLEES



Appeal from the Superior Court of the District of Columbia; Hon. Michael Lee Rankin, Motions Judge

Rogers, Chief Judge, Farrell, Associate Judge, and Pryor, Senior Judge.

The opinion of the court was delivered by: Rogers

Petition for Review of an Order of the District of Columbia Rental Housing Commission

These consolidated appeals involve appeals by the tenants from the decision of the Rental Housing Commission (Commission) and by their landlord from the denial of reconsideration of an order denying release of funds held in the court registry pursuant to a protective order.

In Appeal No. 88-1216 the tenants appeal from a decision of the Commission that intervenor-landlord, Jo Freeman, had met the "special circumstances" exemption under the "small landlord" provision of the Rental Housing Act of 1980. *fn1 D.C. Code § 45-1516 (a)(3) (1981). *fn2 They contend that the Commission should have dismissed Freeman's appeal from the Rental Accommodations and Conversion Division (RACD) of the Department of Consumer and Regulatory Affairs since she failed to comply with the Commission's regulations regarding the procedural requisites for filing an appeal. The tenants also contend that the Commission erred when it found that Freeman qualified under the small landlord provisions of the Rental Housing Act. We affirm.

In Appeal No. 89-648, the landlord appeals from the denial of her motion for reconsideration of the denial of release of funds paid into the Landlord and Tenant Branch registry pursuant to an action for possession filed in the Landlord and Tenant Branch of the Superior Court. Since our affirmance of the Commission's decision in the tenants' appeal effectively disposes of the issue presented in the landlord's appeal, we remand this case to the trial court to conduct a McNeal *fn3 hearing on whether there existed code violations during the time the protective order was in effect to justify an abatement of the rent paid into the registry.

I.

The property is a single family house located at 1733 Riggs Place, N.W. It has two rental units, one comprised of the first, second and third floors, the other a basement apartment. Intervenor Freeman, who was a tenant in the building, purchased the property in 1979.

Freeman moved to New York to attend law school a short time after purchasing the property and began renting both units. The present dispute involves the claims of persons belonging to three separate tenant groups who rented the upstairs unit. *fn4 At no time during the rental period, from September 1982 to September 1985, had Freeman filed a claim of exemption from rent control under D.C. Code § 45-1516 (a)(3) (1981).

The tenants filed a petition with the RACD on February 25, 1985, alleging that Freeman had collected rents beyond the maximum allowable under the rent ceiling established pursuant to D.C. Code § 45-1517 (1981), and that Freeman was not entitled to the small landlord exemption in section 45-1516 since she had failed to file a claim of exemption with the Rent Administrator. *fn5 A hearing examiner agreed with the tenants, granted a rent refund in the amount of $14,280.00, and awarded attorney's fees, but denied the tenant's request for treble damages.

Both parties appealed to the Rental Housing Commission. The tenants filed a motion to dismiss Freeman's cross-appeal on the ground that she had neither complied with the hearing examiner's order nor timely requested a stay and posted a bond prior to filing the appeal. *fn6 The tenants interpreted the Commission's regulations on a stay pending appeal, 14 DCMR §§ 3302.1-3302.8 (1983), to require dismissal of an appeal where the appellant has not complied with the hearing examiner's order nor filed a motion to stay pending the appeal.

The Commission denied the tenants' motion, ruling that its regulations regarding stays pending appeal were inconsistent with Strand v. Frenkel, 500 A.2d 1368 (D.C. 1985), and therefore invalid. The Commission reasoned that:

the logic which dictated the Court's holding in Strand is equally applieable to decisions of the Rent Administrator which order monetary awards, and we are compelled to conclude, following Strand and Whiteside, that a Rent Administrator's order to pay money is not final for enforcement purposes [in the Superior Court] until the opportunity for Commission and appellate review have been exhausted. This being the case, it follows logically and inevitably that there is no need for the appellant [as was required by the 1980 Act regulations] to move to stay enforcement of the order under review; its enforcement is deemed stayed by operation of law.

On the merits, the Commission reversed the decision of the hearing examiner awarding a refund to the tenants. It ruled that the rental unit was exempt from rent control even though Freeman had failed to file an exemption as required by D.C. Code ยง 45-1516 (a)(3) (1981). The Commission held, in accordance with its decision in Gibbons v. Hanes, No. TP 11,076 (July 11, 1984), that "special circumstances" existed exempting Freeman from filing the certificate of exemption. Specifically, the Commission concluded that Freeman met the special circumstances exception because "she is not a landlord regularly," and was "reasonably unaware of the requirement of filing a claim of exemption." Relying on the analysis by the hearing ...


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