AL 410446 RO
                                                                        STATE OF NEW YORK
                            OFFICE OF RENT ADMINISTRATION
                                     GERTZ PLAZA
                               92-31 UNION HALL STREET
                              JAMAICA, NEW YORK   11433

          APPEAL OF                             DOCKET NO.:  AL 410446 RO

                     DOUGLAS NEMENS,
                                               D.R.O. ORDER NO.:  CDR 27,454
                                               D.R.O. DOCKET NO.:  TC-068852-G
                                               TENANT:  ROBERT SONNENSCHEIN

                           MODIFYING ADMINISTRATOR'S ORDER

          On December 19, 1986 the  above-named  petitioner-owner  filed  a
          Petition for Administrative Review against  an  order  issued  on
          November 24, 1986  by  the  Rent  Administrator  at  10  Columbus
          Circle, New York, New  York,  concerning  housing  accommodations
          known as apartment number 2R at 338 West 72nd Street,  New  York,
          New  York,  wherein  the  Rent  Administrator   established   the
          stabilized rent  and  directed  the  owner  to  refund  $5,394.60
          including interest from April 1, 1984.

          The Commissioner notes that this proceeding was  initiated  prior
          to April 1, 1984.  Sections 2526.1(a)(4)  and  2521.1(d)  of  the
          Rent Stabilization Code (effective May 1,  1987)  governing  rent
          overcharge  and  fair  market  rent  proceedings   provide   that
          determination of these matters be based  upon  the  law  or  code
          provisions in  effect  on  March  31,  1984.   Therefore,  unless
          otherwise  indicated,  reference  to   Sections   of   the   Rent
          Stabilization Code (Code) contained herein are  to  the  Code  in
          effect on April 30, 1987.

          The Commissioner has reviewed all of the evidence in  the  record
          and has carefully considered that portion of the record  relevant
          to the issues raised by the administrative appeal.

          This proceeding was originally commenced on January 18,  1983  by
          the filing of a complaint of rent overcharge with  the  New  York
          City Conciliation and Appeals Board  (CAB,  the  agency  formerly
          charged with enforcing the Rent Stabilization Law) by the tenant.

          The owner failed to submit a complete  rental  history  from  the
          base date.

          On the chart attached to and  made  a  part  of  the  order,  the
          Administrator established the stabilized  rent  under  the  lease

          AL 410446 RO
          term which ended on January 31, 1984.

          In its Petition, the owner contends that, the Administrator erred 
          on the rent calculation chart attached to the order by failing to 
          acknowledge that the owner had answered the complaint.

          In his answer to the petition, the  tenant,  in  substance,  asks
          that the petition be denied and that the order below be affirmed.

          The Commissioner is of the opinion that this petition  should  be

          The Commissioner notes that based on a stipulation of  settlement
          dated  June  6,  1988,  between  the  owner   and   tenant,   the
          Administrator terminated the tenant's application  for  an  order
          directing the owner to offer the  tenant  a  renewal  lease  (DRO
          Docket No. BK 410061 RV).  That stipulation was entered  into  in
          the context of a non-payment  proceeding.   The  tenant  and  the
          owner were represented by counsel and the  stipulation  was  "So-
          Ordered" by the  Civil  Court  Judge.   The  tenant  specifically
          withdrew its complaint under BK 410061 RV.  As part of the stated 
          consideration from the owner,  in  that  stipulation,  the  owner
          agreed "to waive  and  forgive  all  past  rent  and/or  use  and
          occupancy which has accrued through this date and further  agrees
          to waive the payment of future rents  and/or  use  and  occupancy
          through July 31, 1988, including  any  adjustment  and  award  in
          Petitioner's [owner's] favor in  the  PAR  under  Docket  No.  AL
          410446 RO."  Among the items of consideration  from  the  tenant,
          the stipulation provided that the tenant  deliver  possession  of
          the apartment on or before July 31, 1988.

          The Commissioner notes that the record herein does  not  indicate
          whether or not all of the  terms  and  conditions  of  the  above
          stipulation  were  complied  with   by   the   parties   thereto.
          Therefore, the said record does not indicate to what  extent,  if
          any, the various terms and conditions therein became  binding  on
          either of the parties thereto.

          The Commissioner also notes that the funds to be paid and credits 
          allowed under the stipulation cannot be readily  related  to  the
          refund directed in the appealed order.

          The Commissioner also  notes  that  the  Division's  registration
          records indicate that for 1989, the apartment was  registered  as
          exempt from registration, as of July 1, 1988, by reason of  owner
          or owner's employee's occupancy; and that said apartment was  not
          registered for 1990.

          The Commissioner also notes that in the tenant's  November,  1984
          complaint, filed under DRO Docket No. BK 410061  RV,  the  tenant
          stated that his February 1, 1984 through July 31, 1986 lease rent 
          was $461.75; which the Commissioner finds represents the correct, 
          7%, increase due under Guidelines No. 15 for said lease over  the
          rent determined in the  appealed  order  as  the  legal  rent  on
          September 30, 1983.

          Based on all of the above circumstances and noting the absence in 
          the stipulation of language which clearly indicates  the  owner's
          intention to withdraw the instant  PAR,  the  Commissioner  finds

          AL 410446 RO
          that said PAR was not withdrawn by the June 6,  1988  Stipulation
          and that said PAR must be determined on its merits.

          Section 42A of the former Rent Stabilization Code  requires  that
          an owner retain complete records for each stabilized apartment in 
          effect from June 30, 1974  (or  the  date  the  apartment  became
          subject to rent stabilization, if later) to date and  to  produce
          such records to the DHCR upon demand.

          Section 26-516 of Rent  Stabilization  Law,  effective  April  1,
          1984, limited an owner's obligation to provide  rent  records  by
          providing that an owner  may  not  be  required  to  maintain  or
          produce rent records for more than 4  years  prior  to  the  most
          recent registration, and  concomitantly,  established  a  4  year
          limitation on the calculation of rent overcharges.

          It has been the DHCR's policy that  overcharge  complaints  filed
          prior to April 1, 1984 are to be processed pursuant to the law or 
          Code in effect on March 31, 1984.  (See Section  2526.1(a)(4)  of
          the current Rent Stabilization Code.)   The  DHCR  has  therefore
          applied Section 42A of the former Code to  overcharge  complaints
          filed prior to April 1, 1984, requiring complete rent records  in
          these cases.  In following this policy, the DHCR has sought to be 
          consistent with the legislative intent of the Omnibus Housing Act 
          (Chapter 403, Laws of 1983), as implemented by the New York  City
          Conciliation and Appeals Board (CAB), the predecessor  agency  to
          the DHCR, to determine rent overcharge complaints filed with  the
          CAB prior to April 1, 1984 by applying the law in effect  at  the
          time such complaints were filed so as not to deprive such tenants 
          of their right to have the lawful stabilized rent determined from 
          the June 30, 1974 base date and so  as  not  to  deprive  tenants
          whose overcharge claims accrued more than 4 years prior to  April
          1, 1984 of their right to  recover  such  overcharges.   In  such
          cases, if the owner failed to produce the required rent  records,
          the lawful stabilized rent would be determined  pursuant  to  the
          default procedure approved by the Court of  Appeals  in  61  Jane
          Street Associates v. CAB, 65 N.Y.2d 898, 493 N.Y.S.2d 455 (1985).

          However, it has recently been held in the case of J.R.D. Mgt.  v.
          Eimicke, 148 A.D.2d 610, 539 N.Y.S.2d 667  (App.  Div.  2d  Dep't
          1989), motion for leave to reargue or for leave to appeal to  the
          Court of Appeals denied (App. Div. 2d Dep't, N.Y.L.J.,  June  28,
          1989, p.25, col. 1), motion for leave to appeal to the  Court  of
          Appeals denied (Court of Appeals, N.Y.L.J., Nov. 24, 1989, p. 24, 
          col. 4), motion for leave to reargue denied  (Court  of  Appeals,
          N.Y.L.J., Feb 15, 1990, p. 25, col. 1), that the law in effect at 
          the time of the determination  of  the  administrative  complaint
          rather than the law in effect at the time of the  filing  of  the
          complaint must be applied and that the DHCR could not require  an
          owner to produce more than 4 years of rent records.

          Since  the  issuance  of  the  decision  in  JRD,  the  Appellate
          Division, First Department, in the case of Lavanant v. DHCR,  148
          A.D. 2d 185, 544 N.Y.S.2d 331 (App. Div.  1st  Dep't  1989),  has
          issued a decision in direct conflict with  the  holding  in  JRD.
          The Lavanant court expressly rejected  the  JRD  ruling,  finding
          that the DHCR may properly require an owner  to  submit  complete
          rent records, rather than records for just four years,  and  that
          such requirement is both rational and supported by  the  law  and

          AL 410446 RO
          legislative history of the Omnibus Housing Act.

          Since in the instant case the subject dwelling unit is located in 
          the First Department, the DHCR is not constrained to  follow  the
          JRD decision in determining the  tenant's  overcharge  complaint,
          limiting the requirement for rent records to April 1, 1980.

          The Commissioner finds that the owner did answer  the  complaint,
          but failed to sustantiate September  1,  1974  (the  commencement
          date of the first lease submitted by the owner) as the base date. 
          Therefore, the owner was properly held in  default  below.   That
          default has not been cured on appeal.

          The Commissioner also  finds  that  the  tenant's  last  name  is
          misspelled in the order below and that  order  should  hereby  be
          amended to correct the spelling of the tenant's  last  name  from
          Sonnenschen (as it appears in the order  below)  to  the  correct
          spelling:  Sonnenschein.

          The Commissioner notes that, upon the expiration of the period in 
          which the owner may institute a proceeding  pursuant  to  Article
          Seventy-eight  of  the  Civil  Practice  Law   and   Rules,   the
          Administrator's Order,  as  amended  hereby,  may  be  filed  and
          enforced by the tenant in the same manner as a judgment, provided 
          that doing so does not constitute an attempt to collect more than 
          one refund for  the  overcharges  found  in  the  Administrator's

          THEREFORE, in accordance with  the  Rent  Stabilization  Law  and
          Code, it is

          ORDERED, that the Petition be, and the  same  hereby  is,  denied
          and that the Administrator's order be, and the  same  hereby  is,
          amended in accordance with the order and opinion.

                                                  ELLIOT SANDER
                                                  Deputy Commissioner

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