
    In the Matter of Dobson Factors, Inc., Petitioner, against Temporary State Housing Rent Administrator, Respondent.
    Supreme Court, Special Term, New York County,
    November 12, 1957.
    
      Jay Emanuel for petitioner.
    
      Nathan Heller and I. Walton Bader for respondent.
   Felix C. Benvenga, J.

This article 78 proceeding is brought by petitioner landlord to review a determination of the State Rent Administrator which granted the landlord an increase in rent in an amount less than requested.

In January, 1956, the landlord filed an application for an adjustment in rent from $55.20 to $90 a month, on the ground it had furnished an unfurnished apartment at a cost of $840. In August of that year, the local rent office granted an increase of $10 a month. Following the denial of its protest, the landlord instituted an article 78 proceeding, but before the proceeding came on to be heard, the administrator requested that the matter be remanded for further consideration. Upon the basis of a finding that the landlord had expended the sum of $824.95 for new furniture the rent was increased from $55.20 to $69 a month, effective August, 1956.

On the basis of this increase, the landlord will have amortized his capital investment and received a return of 6% thereon in approximately six years. Clearly, the adjustment over the period stated cannot be held to be unreasonable or arbitrary, especially in view of the two-year lease with the tenant. Since there is reasonable basis for the determination, this court cannot substitute its judgment for that of the administrator (Matter of Park East Land Corp. v. Finkelstein, 299 N. Y. 70, 76; Matter of First Terrace Gardens v. McGoldrick, 1 NY 2d 1, 4).

Apparently, the administrator has decided upon a policy of granting an increase in rent of 25% over the prior maximum rent, where an unfurnished apartment is converted into a furnished apartment with new furniture. While the policy is commendable, the formula should not be applied, except where, as in the instant case, it gives the landlord a fair return on his investment (see Matter of Rubenstein, N. Y. L. J., Oct. 15, 1957, p. 6, col. 1).

As for the effective date of the order, it is to be noted that it is the date of the granting of the original increase and that it becomes effective eight months after the filing of the original application. This date is in accordance with section 32 of the State Bent and Eviction Begulations.

The petition is dismissed.  