BD-210444-RO;  BD-210154-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 NOS.: BD-210444-RO
                                                  BD-210154-RO
                    MYRA REALTY CO.,              D.R.O. DOCKET NO.:
                                                  K-310707-R  
                                   PETITIONER     CDR 29,447
          -----------------------------------X


          ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                                   IN PART

          On April 20,  1987  the  above  named  petitioner-owner  filed  a
          Petition for Administrative Review against an order of  the  Rent
          Administrator 10 Columbus Circle,  New  York,  New  York,  issued
          March 20, 1987.  The order concerned housing accommodations known 
          as Apartment 1-G, 300 Ocean Parkway,  Brooklyn,  New  York.   The
          Administrator determined that the tenant had been overcharged.

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

          The tenant commenced the proceeding by filing a  rent  overcharge
          complaint on March 5, 1984.  The petitioner failed  to  submit  a
          rental history.  The Administrator adjudged a default and applied 
          the  procedures  based  on  Section  42A  of  the   former   Rent
          Stabilization Code.  A base rent of $268.58  was  calculated  and
          total overcharges of  $4755.87  were  assessed  including  treble
          damages and excess security.

          The Commissioner  notes,  initially,  that  this  proceeding  was
          erronously assigned two docket numbers.  Since both  involve  the
          identical proceeding they are both consolidated for decision.

          The petitioner makes several arguments in urging  reversal.   One
          argument  is  that  the  Administrator  improperly  and  adjudged
          adefault because the required rental history was  submitted.   As
          petitioner has raised the rental history issue, the  Commissioner
          is required to grant the petition.  After careful  consideration,
          the petition is 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  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






          BD-210444-RO;  BD-210154-RO
          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  pro-
          duce 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  Dept'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
          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.

          Applying JRD to the instant case, the  Commissioner  must  accept
          the April 1, 1980 rent ($300 per month) as proper.  The sole is-






          BD-210444-RO;  BD-210154-RO
          sue remaining is whether the subsequent increases fell within the 
          guides.  The Commissioner finds that they did  for  example,  the
          lease beginning December 1, 1981 was  for  a  monthly  rental  of
          $348.00 and for a three-year term.  Petitioner  was  permitted  a
          16% increase under Guideline 13 for a three-year  renewal  lease.
          Thus, 300 + 16%/month.  The Commissioner finds the two succeeding 
          leases (beginning December 1, 1984 and 1986) to be  proper.   The
          Administrator's order is, accordingly revoked.

          If the current owner has already complied with the Adminis- 
          trator's order and arrears are due and owing due to  the  present
          determination, the current owner is directed to allow the  tenant
          to pay off said arrears in  twelve  equal  monthly  installments.
          Should the  tenant  vacate  the  apartment,  or  have  previously
          vacated, said arrears are due and payable immediately.


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

          ORDERED, that this petition be, and the same  hereby  is  granted
          and that the Rent Administrator's order be, and the  same  hereby
          is, revoked.


          ISSUED:



           
                                                     ELLIOT SANDER
                                                     Deputy Commissioner



    

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