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Majerle Management, Inc. v. District of Columbia Rental Housing Commission

March 15, 2001

MAJERLE MANAGEMENT, INC., PETITIONER,
v.
DISTRICT OF COLUMBIA RENTAL HOUSING COMMISSION, RESPONDENT.



Before Terry and Reid, Associate Judges, and King, Senior Judge.

The opinion of the court was delivered by: King, Senior Judge

Petition for Review of a Decision of the District of Columbia Rental Housing Commission

Argued January 4, 2001

This petition for review arises from the Rental Housing Commission's ("RHC") adjudication of a tenant's complaint against her housing provider, Majerle Management Inc. ("Majerle"), for asserted rent overcharges and diminution in services and facilities. Although Majerle raises a number of challenges, only two merit extensive discussion: (1) whether the lawful rent ceiling for the tenant was the amount established by the last perfected rent ceiling filing or the unauthorized amount of rent collected before the date reached by the three-year statute of limitations; (2) whether an award for diminution in services and facilities may compensate the tenant for damages occurring not only within the three years prior up to the filing of her complaint, but also through the date of the rehearing.

We conclude, with respect to the first issue, that the rent ceiling, rather than the rent charged, governs. We do not decide the services compensation issue for the reasons stated. Therefore, we remand the case to the RHC for further proceedings on the services compensation issue, but affirm on all other issues.

I.

In the mid 1970s, Bertha Redman ("tenant") first became a tenant in the five-unit apartment building at 4301 Halley Terrace, Southeast. Nearly a decade later, in December 1986, William and Mary Bailey purchased the property as tenants by the entirety and continued to make the units available for rent. On December 22, 1987, as is required by the Rental Housing Act of 1985 ("Act"), *fn1 Mr. Bailey filed an amended registration statement for the property, which was defective in several respects. *fn2 The amended registration form stated that the tenant's rent ceiling and monthly rent had been increased from $218 per month *fn3 to $228 on September 1, 1987. The tenant paid $228 in rent until November 1, 1988, when the rent was again increased and the tenant began paying $239.

On September 1, 1989, Majerle increased the tenant's rent to $250, which the tenant paid. As with the increase of the preceding year, there was no filing with the Rent Administrator requesting authorization for the rent increase. Also during 1989, the roof above the tenant's apartment began to leak, which caused damage to her ceiling.

Near the end of 1989, Mr. Bailey died; his wife assumed full ownership of the property and, soon thereafter, hired Majerle to manage the property. Mrs. Bailey filed two further amended registration forms; one in March 1990, and one in July 1991. The July 1991 filing requested a 4.6% rent increase; it was the only filing, other than the 1987 filing, seeking a rent ceiling increase. Also during July 1991, the tenant's rent was decreased from $250 to $240.

On September 22, 1992, the tenant filed a complaint with the Rental Accommodations and Conversion Division ("RACD") against "Majerle Management Inc./For Mary Bailey and the Estate of William Bailey." In her petition, the tenant alleged, inter alia, that the rent she was being charged exceeded the lawful rent ceiling and that the services and facilities derived from the apartment had been substantially reduced due to several housing code violations, in particular the leaking roof and damaged ceiling.

After a hearing and appeals process spanning nearly seven years, the RHC - the appellate body for the RACD - issued a final decision in June 1999. The RHC awarded the tenant damages, which it trebled, for rent overcharges *fn4 and damages for the diminution in value of services and facilities, caused by the leaking roof and other housing code violations. *fn5 The recovery for the diminution in services and facilities was awarded through the date of the RACD rehearing of the tenant's complaint, i.e., March 1996. In addition, both awards included interest through the date of the RHC's decision. Finally, the RHC also imposed two fines against Majerle: a $500 fine for failing to register under the Act and a $1,000 fine for retaliation against the tenant. Majerle filed a timely petition for review of the RHC's decision.

II.

In reviewing an administrative decision such as the one under review here, this court examines, among other things, whether the findings and conclusions are "[a]rbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law" or "[u]nsupported by substantial evidence in the record of the proceedings." D.C. Code § 1-1510 (a)(3)(A) & (E) (1999); see also Washington Times v. District of Columbia Dep't of Employment Servs., 724 A.2d 1212, 1216 (D.C. 1999). The scope of our review of the decision is limited, and we will affirm where: (1) the agency's decision states findings of fact on each material, contested issue; (2) those findings are based on substantial evidence; and (3) the conclusions of law flow ...


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