ADM. REVIEW DOCKET NO.: BE 410407 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.: BE 410407 RO 
                                              :      DRO     DOCKET     NO.:
                                                 L 3113653 R/T
              MONDIAL REALTY CORP.                 
                                                 TENANTS: George King 
                                PETITIONER         :                Margaret
                                                          (Dickenson) 
          ------------------------------------X                         King
             
            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
            IN PART, AND MODIFYING DISTRICT RENT ADMINISTRATOR'S ORDER

               On May 4, 1987,  the  above-named  petitioner-owner  filed  a
          Petition for Administrative Review  against  an  order  issued  on
          April 1, 1987, by the Rent Administrator, 10 Columbus Circle,  New
          York, N.Y., concerning housing accommodations known  as  Apartment
          No. 1A at 109 E. 73rd Street, New York,  N.Y.,  wherein  the  Rent
          Administrator determined that the tenant had been overcharged.  

               The issue in this appeal is whether the Administrator's order 
          was warranted.

               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, any reference in this order  and  opinion  to
          Sections of the Rent Stabilization Code is to the Code  in  effect
          on April 30, 1987, and this  proceeding  is  being  determined  in
          accordance therewith.

               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  of  a
          rent overcharge complaint by the tenant with  the  New  York  City
          Conciliation and Appeals Board, one of the predecessor agencies to 
          the  DHCR.   The  tenant  took  occupancy  pursuant  to  a   lease
          commencing November 1, 1981 and expiring October  31,  1982  at  a
          monthly rent of $755.29. 






               The owner was served with a copy of  the  complaint  and  was
          requested to submit rent records to prove the  lawfulness  of  the






          ADM. REVIEW DOCKET NO.: BE 410407 RO
          rent being charged.  In answer to the complaint, the owner 
          submitted a complete set of leases from the base  date  (June  30,
          1974) and the rental history for the subject apartment.

               In Order Number CDR 29,667, the District  Rent  Administrator
          established the lawful stabilized rent, determined that the tenant 
          had been overcharged and directed the owner to refund  overcharges
          of $14,921.75, plus interest on overcharges collected after  April
          1, 1984, to the tenant.  

               The Petitioner contends that, pursuant to Section  2521.2  of
          the Rent Stabilization Code, the  Administrator  was  required  to
          allow the owner prior increases not previously charged, in 
          determining the amount of overcharge.  

               In the alternative, the petitioner maintains  that  the  Rent
          Administrator erred in his calculation of the overcharges in  that
          the  Administrator  failed  to  properly  calculate   the   lawful
          stabilized rent from the June 30, 1974 base date.

               In answer to the owner's petition, the tenant  asserted  that
          the owner's statements  at  PAR  were  intended  solely  to  delay
          repayment to her of the overcharges.  

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

               The Commissioner finds that the Rent  Stabilization  Law  and
          Code provide rules for the maximum legal stabilized rent that  may
          be charged.  However, nothing prohibits  an  owner  from  charging
          less than that amount.  It has been  a  consistent  administrative
          rule, affirmed by the courts, that once  a  rent  lower  than  the
          lawful stabilized rent is charged pursuant to a lease,  especially
          in the absence of a "sweetheart lease" and/or a dual registration, 
          that the portion of  the  increase  waived  cannot  thereafter  be
          recouped by charging more than the then allowable  increase.   The
          Commissioner notes that Section 2521.2 of the  Rent  Stabilization
          Code, cited by the petitioner, applies to complaints  filed  after
          April  1,  1984,  and  thus  is  not  applicable  to  the  instant
          proceeding.    

               The Commissioner  finds  that  the  Administrator  failed  to
          properly calculate the lawful stabilized rent from the  base  date
          of June 30, 1974.  Accordingly,  the  lawful  stabilized  rent  is
          recalculated on the attached rental history chart, which hereby is 
          made a part of this order.  The  total  overcharge,  inclusive  of
          interest on overcharges collected on or after April 1,  1984,  and
          excessive security, is  $10,412.05.   The  owner  is  directed  to
          refund this amount to the tenant.   





               This order of the state Division  of  Housing  and  Community
          Renewal awarding penalties 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 a tenant in the same manner as a judgment  or  not  in






          ADM. REVIEW DOCKET NO.: BE 410407 RO
          excess of twenty percent thereof per month may be  offset  against
          any rent thereafter due the owner.

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

               ORDERED, that this petition be and the same hereby is granted 
          in part, and the District Rent Administrator's order  be  and  the
          same hereby is modified pursuant to this order.  

          ISSUED:






                                                                        
                                          ELLIOT SANDER
                                          Deputy Commissioner



                                          






























    

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