BA 110090 RO; BA 110449 RO

                                STATE OF NEW YORK
                    DIVISION OF HOUSING AND COMMUNITY RENEWAL
                          OFFICE OF RENT ADMINISTRATION
                                   GERTZ PLAZA
                             92-31 UNION HALL STREET
                             JAMAICA, NEW YORK 11433

      ------------------------------------X 
      IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
      APPEAL OF                              DOCKET NO. BA 110090 RO
                                                        BA 110449 RO

                                          :  DRO DOCKET NO. Q 3119318 R
           Grenadier Realty Corp.,                          CDR 28,416
           Janet Spafford, 
                                             TENANT: Ronald and Rosemary      
                                                         DiGangi

                               PETITIONER : 
      ------------------------------------X                             

          ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW


      On December 31, 1986, the above-named petitioner-owner filed a Petition 
      for Administrative Review against an order issued on December 16, 1986, 
      by the Rent Administrator, 10 Columbus Circle, New York, New York, 
      concerning the housing accommodations known as 255-31 74th Avenue, (aka 
      70-33 260th Street) Glen Oaks, New York, Apartment No. #1 (aka H41, 
      77H41 and 77H041) wherein the Rent Administrator determined that the 
      owner had overcharged the tenant.

      On December 31, 1986, a duplicate petition was filed by the owner 
      against the aforementioned order.  These petitions are being 
      consolidated for disposition herein.  

      The Administrative Appeal is being determined pursuant to the provisions 
      of Section 2526.1 of the Rent Stabilization Code.

      The issue herein is whether the Rent Administrator's order was 
      warranted.

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

      This proceeding was originally commenced by the filing in March 1984 of 
      a rent overcharge complaint by the tenant who had taken occupancy of the 
      subject apartment in March 1975.

      The owner failed to respond to the tenant's complaint.

      In Order Number CDR 28,416, the Rent Administrator determined that, due 
      to the owner's failure to submit a complete rental history, the tenant 
      had been overcharged in the amount of $2,866.27 and directed the owner 
      to refund such overcharge to the tenant as well as to reduce the rent.

      In these petitions, the owner contends in substance that it did not 
      default as the Rent Administrator failed to consider the rental history 







          BA 110090 RO; BA 110449 RO

      and miscalculated the rent.

      In answer to the owner's petition, the tenant stated in substance that
      the order was warranted because the owner failed to submit rent records 
      from 1968.

      The Commissioner is of the opinion that these petitions should be 
      granted.
           
      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) and to produce such records to the DHCR upon 
      demand.

      Section 26-516 of the 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 to produce rent records for 
      more than four (4) years prior to the most recent registration, and 
      concomitantly, established a four 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 rights 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 four years prior to April 1, 1984 of 
      the 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. Mgmt. v. 
      Eimicke, 148 A.D.2d 610. 539 N.Y.S. 2d 667 (App. Div. 2d Dept., 1989). 
      motion for leave to reargue or for leave to appeal to the Court of 
      Appeals denied ( App. Div. 2d Dept., 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 four 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 Dept. 1989), has issued a decision in direct 
      conflict with the holding in JRD.  The Lavanant court expressly rejected 


          BA 110090 RO; BA 110449 RO

      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 
      legislative history of the Omnibus Housing Act.

      Since in the instant case the subject dwelling unit is located in the 
      Second Department, the DHCR is constrained to follow the JRD decision in 
      determining the tenant's overcharge complaint, limiting the requirement 
      for rent records to April 1, 1980.  An examination of the rent records 
      from April 1, 1980 discloses that no rent overcharge occurred.  
      Therefore, the Rent Administrator's order finding a rent overcharge must 
      be revoked.

      If the owner has already complied with the Rent Administrator's order 
      and there are arrears due to the owner as a result of the instant 
      determination, the tenant is permitted to pay off the arrears in 24 
      equal monthly installments.  Should the tenant vacate after the issuance 
      of this order or have already vacated, said arrears shall be payable 
      immediately.

      THEREFORE, in accordance with the Appellate Division ruling in JRD, it 
      is

      ORDERED, that these petitions for administrative review be, and the same 
      hereby are, granted, that the order of the Rent Administrator be, and 
      the same hereby is, revoked, and it is found that no rent overcharge 
      occurred.

      ISSUED:



                                                                    
                                      JOSEPH A. D'AGOSTA
                                      Acting Deputy Commissioner




                 

























          BA 110090 RO; BA 110449 RO













    

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