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CONNOR v. WHEELER

April 21, 1948

CONNOR
v.
WHEELER



The opinion of the court was delivered by: GOURLEY

This is an action brought by R. V. Connor against Edith K. Wheeler for treble damages pursuant to the provisions of Section 205(e) of the Emergency Price Control Act of 1942, as amended, 50 U.S.C.a.Appendix, § 901 et seq.

The hearing was held before the Court without a jury, and each of the parties to said proceeding waived and elected not to file suggested findings of fact and conclusions of law.

 The defendant, Edith K. Wheeler, one of the owners of certain real estate, acted as landlord and rental agent of the housing accommodation situate at 2309 Sassafras Street, First Floor, Front, Erie, Pennsylvania, during the period involved in this proceeding.

 It is alleged by the tenant plaintiff that the defendant demanded and received rent from October 15, 1945 through May 15, 1946, for the use and occupancy of said premises in excess of the maximum rents established by the Rent Regulation for Housing (8 Fed.Reg. 7322) as amended, issued pursuant to Section 2(b) of the Act.

 The plaintiff contends that said housing unit which comprised three rooms and bath, unfurnished, and without garage, was orally rented for the amount of $ 38.00 per month. That said rental was paid each month from the 15th day of october, 1945 through the 15th day of May, 1946, and receipts were duly issued. That several months after the premises had been leased, the plaintiff communicated with the Area Rent Director and made complaint as to the amount of the rent which was being charged.

 An investigation was made through the office of the Area Rent Director. As a result thereof, an Order was issued on April 30, 1946, retroactive to October 15, 1945, decreasing the maximum rental from $ 10.00 per week to $ 23.00 per month for the three room and bath unfurnished apartment, without garage. The plaintiff contends that overcharges were made during the period from October 15, 1945 through May 15, 1946, in the amount of $ 15.00 per month, the total amount of overcharge being $ 105.00. Judgment is demanded against the defendant in the amount of $ 315.00, which is three times the amount of the overcharge, together with costs and reasonable attorney's fees.

 The defendant admits that rent was demanded and received in the amount of $ 38.00 per month during the period from October 15, 1945 through May 15, 1946, but contends that the maximum rental for said housing accommodation was in the amount of $ 10.00 per week and that no overcharge exists. That said premises were rented as a furnished apartment comprising three rooms and bath, and since the maximum rent had been previously approved at $ 10.00 per week with garage, that the rental of the three rooms and bath, furnished, without the garage, on the basis of $ 38.00 per month did not amount to an overcharge.

 The defendant also contends that the proceeding is barred by the statute of limitations since the action was not instituted within a period of one year from the date of the alleged overcharges. The complaint was filed on May 27, 1947, and the rentals were paid during the period commencing on October 15, 1945 and ending on May 15, 1946.

 It appears that the maximum legal rent for the unit on March 1, 1942, consisting of three rooms and bath, unfurnished, with garage service, was $ 27.00 per month. Subsequent thereto the premises were furnished, and on March 5, 1943 the Area Rent Director issued an Order establishing the maximum rent as $ 10.00 per week. On October 30, 1945, the defendant filed with the Area Rent Director a report of change in the identity of the landlord, effective September, 1945, in which the name of the landlord was changed from the name of Rosalia C. Kalvelage Estate to Edith K. Wheeler. Edith K. Wheeler was an heir of the Estate of Rosalia C. Kalvelage, who was her mother. No registration was filed, however, as to the rental of the premises as three rooms and bath, unfurnished, without garage, to R. V. Connor, the plaintiff. Subsequent to the rental of the premises by the plaintiff on October 15, 1945, the status of the housing accommodation was investigated by the Area Rent Director and it was determined that the housing accommodation was then rented as unfurnished without garage, and comprised three rooms and bath. The Area Rent Director duly notified the defendant of the proposal to decrease the maximum rent pursuant to Sections 5(c)(3) and (b), and issued a written Order on April 30, 1946, decreasing the maximum rent from $ 10.00 per week to $ 23.00 per month, without services of garage and furniture, retroactive to October 15, 1945. This notice was duly received by the defendant and several conferences were had by her with the Area Rent Director relating to the decrease of the amount of rental. As a result thereof an application for review was filed by the defendant with the Regional Administration for the Office of Price Administration. On August 22, 1946 the determinations of the Area Rent Director were affirmed and due notice given the defendant.

 Under the system of rent control a landlord or rental agent is required to register housing accommodations within thirty days after they are first devoted to that use. Rent Regulations for Housing, Section 4, 8 Fed.Reg. 14663 and 10 Fed.Reg. 3436, further provide, inter alia, that a landlord is required, after housing accommodations have been changed, to register said change within thirty days after the same are devoted to a use different than that which existed when the premises were first registered. This brings notice to the control authority that the premises are again within its official responsibility, and provides data for quick determination as to whether the new rental to be charged exceeds the level permitted by the policy of Congress set out in the statute.

 Where the landlord does not comply with this requirement, there is a likelihood that, as happened here, the transaction will be overlooked for some period of time or, perhaps, escape scrutiny entirely. The landlord is not, therefore, allowed to profit from his own disobedience of the law. If the landlord could keep the excess collections by thus retarding or preventing scrutiny of his contract, he would gain advantage over all landlords who complied with the Act as well as over tenants whose necessity for shelter is too pressing to admit of bargaining over price. Where the landlord fails to notify the Area Rent Director that there has been a change in the rental premises, the landlord may continue to collect the unapproved rental but only on condition that it is subject to a revision by public authority and to a refund of anything then found to have been excessive.

 The Order decreasing the maximum legal rent provided that a refund should be made to the tenant within thirty days from the date of the order. The cause of action, therefore, arose at the end of thirty days from the date of the notice which would be May 30, 1946. The complaint in the instant action was filed May 27, 1947, which was within the one year statute of limitations, so the cause of action is not barred. Woods v. Stone, 68 S. Ct. 624.

 The defendant also contends that the reduction in the amount of rental was unreasonable due to the high cost and expense which exist relative to the upkeep and repair of the property, and the taxes which it is necessary to pay. Regardless of the equities in that respect, the validity of the relevant regulations and the refund order, either on the ground of retroactivity or otherwise, cannot be considered in this Court. Any challenge to the validity or reasonableness of a regulation would have to be considered by the Emergency Court of Appeals. 50 U.S.C.A.Appendix, § 924; Bowles v. Willingham, 321 U.S. 503, 504, 64 S. Ct. 641, 88 L. Ed. 892; Woods v. Cloyd W. Miller Co., 333 U.S. 138, 68 S. Ct. 421; Woods v. Stone, supra.

 The defendant further contends that she has no recollection of receiving the notice of the Area Rent Director dated April 30, 1946, which reduced the maximum rental and directed refund to be made to the tenant.

 The Area Rent Director testified that the notice was duly deposited in the United States mail. Deposit in the post office of a properly addressed prepaid letter raises a presumption that it reached its destination by its due course of mail, and is prima facie evidence that it was received by the person to whom it was addressed. Higgins Lumber Co., Appellant, v. Marucca, 159 Pa.Super. 405, 48 A.2d 48; Wigmore on Evidence, 3d Ed., Vol. 1, Par. 957, p. ...


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