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

          APPEAL OF                              DOCKET NO. BF 110168 RO
                                              :  DRO  DOCKET  NO.TC-076365-G
               BKL  MANAGEMENT  CORP.               TENANT:   JESUS   MACHIN

                                PETITIONER    : 


               On May 23, 1987, the above-named  petitioner-  current  owner
          filed a Petition for Administrative Review against an order issued 
          on November 14, 1986,  by  the  Rent  Administrator,  10  Columbus
          Circle, New York, New York, concerning the housing  accommodations
          known as 90-10 34th Avenue, Queens. New York, Apt. 6N, wherein the 
          Rent Administrator determined that the owner had  overcharged  the
          tenant.  This petition is accepted as timely because a copy of the 
          Rent Administrator's order was not served on the current owner who 
          had purchased the subject premises and registered  with  the  DHCR
          prior to the issuance of the Rent Administrator's order.

               The Administrative Appeal is being determined pursuant to the 
          provisions of Section 2526.1 (a) 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.

               The prior owner was served with a copy of the  complaint  and
          was requested to submit rent records from the base date  to  prove
          the lawfulness of the rent being charged.  There is nothing in the 
          record to indicate that  the  prior  owner  submitted  a  complete
          rental history.

               In Order Number CDR 26,654, the Rent Administrator determined 
          that, due to the prior owner's failure to submit a complete rental 
          history,  the  tenant  had  been  overcharged  in  the  amount  of
          $7028.53 and directed the prior owner to refund such overcharge to 
          the tenant as well as to reduce the rent.

               In this petition, the current  owner  contends  in  substance
          BF 110168 RO

          that  if  notified  of  the  tenant's  complaint,  it  would  have
          submitted a complete rental history.  Along with its petition, the 
          current owner submitted copies of leases for the subject apartment 
          from August 15, 1978.

               The Commissioner is of the opinion that this petition  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
          BF 110168 RO

          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 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  August  15,  1978
          discloses that  no  rent  overcharge  occurred  in  that  a  prior
          tenant's rent  was  $235.65  on  August  15,  1978  and  then  was
          increased to $267.20 for the complaining  tenant's  vacancy  lease
          effective July 1,  1979,  $296.59  effective  September  1,  1981,
          $326.24 effective September 1, 1982, $339.28  effective  September
          1, 1983, $363.03 effective September 1, 1984 and $386.63 effective 
          September 1, 1986, all in  accordance  with  applicable  guideline
          rent increases.

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


                                          ELLIOT SANDER
                                          Deputy Commissioner

                            ADMINISTRATIVE REVIEW BUREAU
                                 COVERING MEMORANDUM

          ARB Docket No.: BF 110168 RO

          DRO Docket No/Order No.: TC-076365-G

          Tenant(s): Jesus Machin

          Owner: BKL Management Corp.

          Code Section: 2526.1 of RSC

          Premises: 90-10 34th Street, Queens, New York, Apt. 6N

          Order        and         Opinion         Granting         Petition
               Petition granted on basis owner submitted a  complete  rental
          history pursuant to JRD and an examination of such rental  history
          discloses that no rent overcharge occurred.


          Processing Attorney:                                             

          Supervising Attorney:                                            

          Bureau Chief:                                                    

          Deputy Commissioner:                                             

          Mailed copies of Order and Determination to:
                           Tenant's Atty             
                           Owner's Atty              

                           Date:              :  by               



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