BF 210087-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 210087-RO
               J.R.D. Management Corp.,        DISTRICT RENT ADMINISTRATOR
                                               DOCKET NO.:K-3105160-R
                                                          CDR         30216

                                       IN PART

          On June  10,  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  housing  accommodations  known  as
          Apartment 6G at 2701 Newkirk Avenue, Brooklyn, New  York  wherein
          the District Rent Administrator determined  that  the  owner  had
          overcharged the tenant.

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

          The applicable sections of the Law are Section 26-516 of the Rent 
          Stabilization Law and  Section  2526.1(a)  of  the  current  Rent
          Stabilization Code.

          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, in  which  she
          stated that she had commenced occupancy on July 1, 1979 at a rent 
          of $197.20 per month.

          The owner was served  with  a  copy  of  the  complaint  and  was
          requested to submit rent records to prove the lawfulness  of  the
          rent being charged.   In  answer  to  the  complaint,  the  owner
          submitted a rental history from 1979.

          In  an  order  issued  on  May  6,   1987   the   District   Rent
          Administrator, using DHCR default procedures, determined that the 
          tenant had been overcharged in the amount of $2,379.60 as of 
          June 30, 1985 and directed the owner to refund such overcharge to 
          the tenant as well as to reduce the rent.

          In this  petition,  the  owner  contends  in  substance  that  it
          submitted all the leases which it received  when  purchasing  the
          subject building in 1980, and that it should not have to  provide
          leases for more than four years prior to April 1, 1984.

          BF 210087-RO

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

          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 that 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, in the  determination  of  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), in cases involving rent  overcharge
          complaints filed prior to April 1, 1984.

          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 1985, 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

          BF 210087-RO
          that 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 present 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.
          Because the owner provided the Administrator  with  rent  records
          from 1979, the Commissioner has  made  use  of  such  records  to
          calculate the  lawful  stabilization  rents  and  the  amount  of
          overcharge.  They are set forth on an  amended  rent  calculation
          chart attached hereto and made a  part  hereof.   The  overcharge
          occurred because the owner took a Guideline 12 increase  over  an
          M.C.I. increase effective April 2, 1981, even though such  M.C.I.
          increase also occurred in Guideline Period 12.

          The Commissioner notes that  the  tenant  apparently  vacated  by
          April, 1986 and that the 1990  registration  listed  the  subject
          apartment as being exempt from rent regulations by virtue of 
          co-op or condo conversion.

          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 that the District Rent  Administrator's  order  be,  and
          the same hereby is, modified in accordance with  this  Order  and
          Opinion.  The  lawful  stabilization  rents  and  the  amount  of
          overcharge are established on the attached chart, which is  fully
          made a part of this order.  The total overcharge for  the  period
          through June 30, 1985, including interest through May 31, 1987 on 
          that overcharge, is $2.76.


                                                       JOSEPH A. D'AGOSTA
                                                       Deputy Commissioner


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