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

          APPEAL OF                               DOCKET NO.: BE 210169 RO

                                                  DRO DOCKET NO.: K 3106420 R

                                  PETITIONER      TENANT:  ABRAHAM TIER

                                ADMINISTRATIVE REVIEW

          On May 8, 1987, the above-named petitioner-owner filed a Petition 
          for Administrative Review against an order issued on April 3, 1987, 
          by the Rent Administrator, 10 Columbus Circle, New York, New York, 
          concerning the housing accommodation known as Apartment mD, 9040 
          Fort Hamilton Parkway, Brooklyn, New York, wherein the 
          Administrator determined that the owner had overcharged the tenant.

          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 

          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 by the filing on March 31, 
          1984 of a rent overcharge complaint.

          In Order Number CPR 29,825, the Administrator determined that, due 
          to the owner's failure to submit a complete rental history, the 
          tenant had been overcharged in the amount of $4,098.13 and directed 
          the owner to refund such overcharge to the tenant as well as to 
          reduce the rent.

          In this petition, the owner requests that the Administrator's order 
          be reversed.  The owner asserts that the Administrator erred in the 

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          application of Rent Guideline Order Number 12 by permitting only a 
          5% vacancy allowance instead of a 10% vacancy allowance.  In 
          addition, the owner asserts that the Administrator confused the 
          subject apartment to which the docket number was assigned.  The 
          owner further asserts that it was not given ample opportunity to 

          The tenant was served with a copy of the petition but has failed to 
          interpose an answer.

          The Commissioner is of the opinion that this petition should be 
          granted in part.

          A review of the records reveals two complaint forms within the 
          file, one for the subject apartment, apartment 3M, and the other 
          one for apartment 1K.  The owner provided a rental history for 
          apartment number 3M only from 1977.

          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).

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          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 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.  Accordingly, 
          Section 42A default procedures should not have been applied.

          A review of the lease history since April 1, 1980 establishes, 
          however, that an overcharge arising out of incorrect collection of 
          a ten percent vacancy increase instead of a five percent vacancy 
          increase was collected.  Under Rent Guidelines Board Order Number 
          12, the owner was entitled to either a 5% or 10% vacancy increase, 
          depending on whether there had been a charge in tenancy since July 
          1, 1975.  The owner herein has not established its entitlement to 
          a 10% vacancy increase.  Although the owner is not required to 
          submit a rental history prior to April 1, 1980 pursuant to JRD, it 
          is required to submit such rental history to prove entitlement to 
          a larger vacancy increase under Guideline 12.  Accordingly, 
          pursuant to Rent Guidelines Board Order number 12, the owner was 
          entitled to only a 5% vacancy increase.  The Commissioner has, in 
          the rent calculation chart attached hereto and fully made a part of 
          this order, recalculated the lawful stabilization rent at $403.34 
          as of November 1, 1984 through October 31, 1986 and amended the 
          refund due to the tenant to $1,250.28 inclusive of excess security 
          and interest on the overcharge collected on or after April 1, 1984.

          Because this determination concerns lawful rents only through 
          October 31, 1986, the owner is cautioned to adjust subsequent rents 
          to an amount no greater than that determined by the Rent 

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          Administrator's order plus any lawful increases.

          This order may, 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, be filed and enforced by the 
          tenant in the same manner as a judgment or not in excess of twenty 
          percent thereof per month may be offset against any rent thereafter 
          due the owner.

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

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


                                                  JOSEPH A. D'AGOSTA
                                                  Acting Deputy Commissioner

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