Docket Number: BF-210003-RO
                                 STATE OF NEW YORK
                           OFFICE OF RENT ADMINISTRATION
                                    GERTZ PLAZA
                              92-31 UNION HALL STREET
                              JAMAICA, NEW YORK 11433

        APPEAL OF                              DOCKET NO.: BF 210003-RO
             A.S.D. REALTY, INC.,              DRO DOCKET NO.:  K  3105107-R
                              PETITIONER    : 

        On May 29, 1987, the above-named petitioner-owner filed  a  Petition
        for Administrative Review against an order issued on May 6, 1987, by 
        the District Rent Administrator, 10 Columbus Circle, New  York,  New
        York, concerning the housing accommodations known as  Apartment  5-D
        at 130 East 18th Street, Brooklyn, New York,  wherein  the  District
        Rent Administrator determined that the tenant had been  overcharged.

        The Commissioner has reviewed all 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 commenced by the filing  of  a  rent  overcharge
        complaint by the tenant on March 31, 1984 with  the  New  York  City
        Conciliation and Appeals Board.

        The tenant took occupancy pursuant to a 1-year lease  commencing  on
        September 1, 1977.

        On October 19, 1984, the owner submitted an answer,  but  failed  to
        provide a lease history for the subject apartment.

        In Order No. 30,205 the  Administrator  found  that  the  owner  had
        failed to submit a complete  rental  history,  determined  that  the
        legal regulated rent  would  be  established  by  using  the  DHCR's
        Section 42A rent roll procedure, established  the  lawful  regulated
        rent as of October 1, 1985 at $291.24 per month, in accordance  with
        the default procedure, and computed total overcharges in the  amount
        of $2,120.94 including excess security  and  accrued  interest  from
        April 1, 1984.

        In its petition, the owner claims, among other things, that (1)  the
        Administrator's use of an apartment in another  line  was  arbitrary
        and in error; (2) weight should  be  given  to  the  owner's  having
        purchased the premises  at  foreclosure;  (3)  the  DHCR  failed  to
        consider other apartments renting at or about the same date  with  a
        higher rent; (4) the  Division,  at  worst,  should  have  used  the
        tenant's initial rent without deducting the Guidelines.
        The Commissioner is of the opinion this petition should  be  granted
        in part, and the District Rent Administrator's order modified.

        Section 42A of the former Rent Stabilization Code requires  that  an

          Docket Number: BF-210003-RO
        owner retain complete  records  for  each  stabilized  apartment  in
        effect from June 30, 1974 (or the date  the  apartment  became  sub-
        ject 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  four  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
        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 four 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.  Mgmt.  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,  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 Lavanat 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 

          Docket Number: BF-210003-RO
        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.

        The tenant has occupied the premises  since  September,  1977.   The
        record contains a complete rental history from the revised base date 
        of April 1,  1980.   The  overcharges  have  been  computed  on  the
        attached rent chart, which is fully made a part of this order.   The
        total of overcharges is $95.11.

        If the owner has already complied with the Administrator's order and 
        there are arrears due to the  owner  as  a  result  of  the  instant
        determination, the tenant may pay off  the  arrears  in  twenty-four
        (24) equal monthly installments.  Should the tenant vacate after the 
        issuance of this order, said arrears shall be payable immediately.

        THEREFORE, pursuant to the Rent Stabilization Law and Code, it is

        ORDERED, that this petition be, and the same hereby  is  granted  in
        part; and that the Administrator's order be, and the same hereby  is
        amended in accordance with this order and opinion.


                                        ELLIOT SANDER
                                        Deputy Commissioner


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