BF 210431 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 210431 RO

                                          :  DISTRICT RENT ADMINISTRATOR'S
           K.S. Katsimbrakis,                DOCKET NO. K 3107682 R
                                             TENANT: Nancy Aguayo             

                            PETITIONER    : 


      On June 25, 1987, the above-named owner filed a petition for 
      administrative review of an order issued on May 22, 1987 by a District 
      Rent Administrator concerning the housing accommodation known as        
      18 Olive Street, Apartment 3FT, Brooklyn, New York.

      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 commenced on March 13, 1984 by the filing of a rent 
      overcharge complaint.  In answer to the complaint, the owner stated that 
      the subject building was not under the jurisdiction of the Rent 
      Stabilization Law because it contained only four residential units.  In 
      an order issued on July 23, 1986, the Administrator found that the 
      subject building was not within the jurisdiction of the Rent 
      Stabilization Law.

      Pursuant to the tenant's request for reconsideration, on April 13, 1987 
      the Division of Housing and Community Renewal (DHCR) notified all 
      parties of its intent to reopen the proceeding.  Both parties were 
      afforded an opportunity to submit any evidence desired in connection 
      with the reprocessing.

      The tenant submitted evidence to indicate that when she took occupancy 
      in 1976 the subject building contained six apartments and the subject 
      building was subsequently reduced to four units.  The owner reasserted 
      that the subject building was not subject to rent stabilization because 
      it contained four apartments.

      On May 22, 1987 DHCR issued the amended order here under review wherein 
      the Administrator revoked the order of July 23, 1986. 

      In his petition for administrative review, the owner alleges that DHCR 
      did not have the authority to reopen this proceeding.  Further, the 
      owner asserts that DHCR had issued conflicting orders which determined 
      that the subject building was not subject to rent regulation and that 

          BF 210431 RO

      the orders granting unregulated status were the correct orders.  Also, 
      the owner alleges that this tenant occupied the subject apartment after 
      the renovations took place and did not have standing to file the 
      complaint.  Finally, the owner notes that the tenant filed no petition 
      for administrative review of the Administrator's order of July 23, 1986.

      After careful consideration, the Commissioner is of the opinion that 
      this petition should be denied.

      First, the Commissioner finds that DHCR did not exceed its authority by 
      reopening the proceeding.  Section 2529.9 states that upon notice to all 
      parties a superseding order may be issued based on "...illegality, 
      irregularity in vital matters or fraud."  In the original proceeding, 
      the owner never sustained his burden of proof in defeating the 
      presumption that the subject building was regulated.  Clearly, this 
      error by the Administrator constituted an irregularity in a vital 
      matter.  Additionally, conflicting orders existed concerning the subject 
      building.  Clearly, the existence of conflicting orders constituted an 
      irregularity in a vital matter.  Accordingly, the Administrator acted 
      appropriately in reopening this proceeding.  The failure of the tenant 
      to file a petition for administrative review does not affect the 
      agency's authority to reopen a proceeding.

      Second, the Commissioner finds that the substantive objections raised by 
      the owner in his petition for administrative review are without merit.  
      All of the owner-submitted documentation indicates that the renovations 
      which reduced the number of apartment in the subject building from six 
      to four took place in 1984.  The Administrator should have determined 
      the rent regulation status of the subject building based on the number 
      of units present in the subject building on June 30, 1974 the date the 
      building first became subject to the Rent Stabilization Law.  Clearly, 
      the evidence demonstrates that on June 30, 1974 the subject building 
      contained six units.   Accordingly, the Administrator correctly revoked 
      the July 23, 1986 order which found that the subject building was not 
      subject to rent stabilization.

      It it noted that on July 1, 1987, the Administrator issued an amended 
      order in this proceeding wherein the Administrator established the 
      tenant's lawful stabilized rent and directed a refund of overcharges to 
      the tenant.

      The Commissioner is aware that conflicting orders concerning the subject 
      building had existed.  All orders are now consistent with the exception 
      of three orders (Docket Nos. 000059515, AJ 210407 R, AL 210313 R) 
      currently being reconsidered by a District Rent Administrator (Docket 
      No. DF 210024 RK).

      Accordingly, the Rent Administrator's order was warranted.

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

      ORDERED, that this petition for administrative review be, and the same 
      hereby is, denied, and, that the order of the Rent Administrator issued 
      July 23, 1986 be, and the same hereby is, affirmed.

          BF 210431 RO


                                      JOSEPH A. D'AGOSTA
                                      Acting Deputy Commissioner



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