Temple v. D.C. Rental Housing Com'n

• Decision Date: 01 December 1987
• Docket Number: No. 85-1119,No. 85-1129,No. 85-1247.,85-1119,85-1129,85-1247.
• Citation: 536 A.2d 1024
• Parties: Timothy O. TEMPLE, Petitioner, v. DISTRICT OF COLUMBIA RENTAL HOUSING COMMISSION, Respondent, Eric D. Kirkendall and George Lobsenz, Intervenors.
• Court: D.C. Court of Appeals

Page 1024

536 A.2d 1024

Timothy O. TEMPLE, Petitioner, v. DISTRICT OF COLUMBIA RENTAL HOUSING COMMISSION, Respondent Eric D. Kirkendall and George Lobsenz, Intervenors.

No. 85-1119

No. 85-1129

No. 85-1247.

District of Columbia Court of Appeals.

Argued September 11, 1986.

Decided December 1, 1987.^*

Eric Von Salzen, with whom Richard T. Rossier, Washington, D.C., was on the brief, for petitioner.

Lutz Alexander Prager, Asst. Deputy Corp. Counsel, with whom John H. Suda, Acting Corp. Counsel at the time the briefs were filed, and Charles L. Reischel, Deputy Corp. Counsel, Washington, D.C., were on the briefs, for respondent.

Richard C. Eisen, Washington, D.C., for intervenors.

Gerald F. Ivey, Washington, D.C., filed a statement in lieu of brief, for amicus curiae, Metropolitan Washington Planning and Housing Ass'n.

Roger D. Luchs, Washington, D.C., filed a brief, for amicus curiae Apartment and Office Building Ass'n of Metropolitan Washington, Inc.

Before MACK and BELSON, Associate Judges, and NEBEKER,¹ Associate Judge, Retired.

MACK, Associate Judge:

In these consolidated petitions, landlord Timothy Temple seeks review of two decisions of the Rental Housing Commission ("RHC") penalizing him for failure to register his housing accommodation. The decisions resulted from separate tenant petitions filed by tenant-intervenors Kirkendall and Lobsenz. In the Kirkendall decision, the RHC ordered Temple to refund to Kirkendall trebled rent overcharges for the period between September 1, 1982, and July 31, 1983. The RHC also awarded attorneys' fees. In the Lobsenz decision, the RHC ordered Temple to refund to Lobsenz trebled rent overcharges for the period between February 1, 1983, and November 30, 1984. The RHC also ordered refunds of trebled rent overcharges to the three other tenants who lived in Temple's apartment house but did not officially join Lobsenz' tenant petition.

Temple alleges that the RHC committed numerous errors in both its determination that he violated the Rental Housing Act of 1980 and its computation of the appropriate penalties. Consistent with this opinion, we affirm in part, reverse in part, and remand for further proceedings.

I.

The protracted dispute in this case arises over Temple's ownership of a five-unit apartment building located at 216 Third St. S.E., Washington, D.C. (hereinafter "the building"). The building is a three-story rowhouse located in an R-4 zoning district. A description of events prior to the commencement of these actions provides the necessary foundation for an understanding of Temple's primary claim.

A. Prior Events

In 1951, Kemper Simpson, the former owner of the building, was issued a Certificate of Occupancy permitting the rental of "all" units in the building. The Certificate did not specify the number of units contained therein, but the issuance of the Certificate for an "apartment building" indicated the District's approval of a nonconforming use in the R-4 zone. In 1962, Simpson applied for a new Certificate of Occupancy, requesting use of the building as a two-family flat. Use of the building as a two-family flat would restore the building to a conforming use within the zone. In 1963, Temple, allegedly without knowledge of the 1962 application by Simpson, purchased the building. Temple asserts that at the time of his purchase, five units in the building were rentals and his purchase was based on that use.

Although Temple was required to secure a new Certificate of Occupancy upon his purchase and use of the property as rentals, 20 DCRR § 8104.1 (1973) (Zoning Regulations) (effective May 12, 1958), he did not do so. Consequently, the District, unaware of Temple's purchase of the building, issued a new Certificate of Occupancy to Simpson in 1964, limiting the use of the building to a two-family flat as per Simpson's 1962 request. Temple asserts that he had no knowledge of the 1964 Certificate of Occupancy.

In 1968, however, Temple applied for and received a Certificate of Occupancy for a two-family flat. In 1970, he sought a variance from the Board of Zoning Adjustment ("BZA") for use of the property as a five-unit apartment building. The variance was contested by the Capitol Hill Restoration Society, and, after lengthly proceedings, the BZA granted a variance for the rental of three, not five, units. Temple never subsequently applied for a Certificate of Occupancy reflecting the permitted variance. Consequently, the 1968 Certificate of Occupancy, permitting two flats, was in effect when rent control first commenced in the District.

Despite the 1964 and 1968 limitation of the use of the property as two flats, Temple at all times operated five units out of his building. At no time between 1971 and 1983 did Temple attempt to seek another variance for operation of a five-unit building. Moreover, throughout the entire time, Temple operated his building without the required housing business license. D.C. Code § 47-2828 (1981) (District may require licenses for buildings other than single-family houses, two-family houses, or rooming houses with fewer than four roomers); 14 DCMR § 200.3 (1986) (no person shall operate a housing business without a housing business license). Finally, at no time between the inception of rent control and 1983, did Temple attempt to register his building with the Rental Accommodations and Conversion Division ("RACD") of the Department of Consumer and Regulatory Affairs.²

B. The Kirkendall Decision

On September 1, 1982, tenant Eric Kirkendall and his wife moved into one of the units in the building under a one year lease of $510 per month. Relations between Temple and Kirkendall deteriorated almost immediately. On January 4, 1983, Kirkendall filed a tenant complaint alleging, in pertinent part, that Temple never registered the building, that he operated a five-unit apartment house when the Certificate of Occupancy authorized only a two-family flat, and that he never obtained a housing business license.³ Kirkendall sought, among other forms of relief, the establishment of the appropriate rent ceiling and a trebled rent refund.

On January 12, 1983, after more than eight years of rent control laws, Temple made his first trip to the RACD to inquire about registration. The RACD informed Temple that he could not register his building until he obtained a Certificate of Occupancy reflecting the building's valid use as a five-unit apartment house.

During the ensuing months, Temple pursued with the BZA a variance from the two-family flat status of his building. In a decision dated July 6, 1983, the BZA granted Temple's application. On July 25, 1983, Temple brought to the RACD the minutes from the BZA meeting which confirmed the BZA's approval of Temple's application for a variance for use of the building as a five-unit apartment house. Temple was issued a temporary registration number at that time.

On September 19, 1983, a hearing on Kirkendall's petitions was held.⁴ In a decision dated October 18, 1983 (hereinafter the "Underdue decision"), hearing examiner Betty Underdue determined in pertinent part that the building was not properly registered and that the correct rent ceiling for Kirkendall's unit was $200. Underdue ordered Temple to properly register the property, established a rent ceiling of $200, and ordered a single refund of all rent Temple charged Kirkendall in excess of the $200 ceiling. An administrative appeal followed.

Pursuant to that appeal, the RHC held a hearing on February 16, 1984. According to record evidence, both before and after the hearing, Temple engaged in several conversations with the RACD in which he attempted to determine how he could establish and adjust the rent ceilings of all the units in his building pending his appeal of the Underdue decision. The Rent Administrator of the RACD apparently informed Temple that the rent ceilings on his other four units could not be established nor could adjustments on all five units be made until the RHC rendered its decision. The Rent Administrator indicated that the outcome of the appeal would establish the rent ceilings for the other four units in the building.

On August 3, 1984, the RHC affirmed the Underdue decision but remanded the case for a determination of whether the RACD should have trebled the rent refund and awarded attorneys' fees to Kirkendall. By a decision dated November 18, 1984 (hereinafter the "Blaher I decision"), hearing examiner Michael Blaher trebled the damage award — due to Temple's "unclean hands" — and ordered payment of reasonable attorney's fees. The RHC affirmed the Blaher I decision on July 18, 1985, and this petition for review followed.

C. The Lobsenz Decision

On February 1, 1983, shortly after Kirkendall filed his first tenant petition, George Lobsenz moved into one of the units in Temple's building for a rent of $665 per month. Approximately one year later, on January 16, 1984, Lobsenz filed a tenant petition alleging that no rent ceiling had been established for his unit, and that consequently, his rent was in excess of the maximum allowable. Temple thereafter requested a stay in the Lobsenz' proceedings pending the RHC's decision in the Kirkendall case. After the August 1984 RHC decision in the Kirkendall case, a hearing was ultimately scheduled on Lobsenz' petition for October 29, 1985.

Prior to the hearing, Temple filed a "voluntary agreement" in which he attempted to set the rent ceilings by agreement of 70% of the tenants in the building. D.C. Code § 45-1526 (1981). Additionally, prior to the hearing, another tenant in the building, Kathleen Michels, wrote a letter to the RACD requesting that the Lobsenz' proceedings be broadened to include all tenants in the building. She also indicated that she had signed the voluntary agreement only after explicitly reserving her right to invalidate her consent.

Hearing examiner Blaher presided over the October 29, 1984, hearing. By order dated October 31, 1984, Blaher assumed...