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

          APPEAL OF                               DOCKET  NO.  BG  410416-RO
                                                 D.R.O.      DOCKET      NO.
                                              :  ZL-003563-R      
             PAN       AM        EQUITIES,        INC.        -        OWNER
                                                 Scott and  Heidi  Lazare  -
                                 PETITIONER   :  


               On July 2, 1987, the above-named petitioner filed a  Petition
          for Administrative Review against an order issued on May 26,  1987
          by the Rent Administrator, 92-31 Union Hall Street,  Jamaica,  New
          York concerning the housing accommodation known as 330  East  39th
          Street,  Apartment  No.  6L,  New  York,  New  York  wherein   the
          Administrator directed the owner to roll  back  the  rent  and  to
          refund overcharges of $3,704.66 inclusive of excess  security  and
          interest on the overcharge occurring on or after April 1, 1984. 

               The tenant commenced this proceeding on September 5, 1985  by
          filing a complaint of rent overcharge. 

               A copy of the complaint was served on the owner on  September
          13, 1985. 

               In the order  issued  on  May  26,  1987,  the  Administrator
          established the legal regulated rent at $1,628.89 as  of  July  1,
          1986 and directed the owner to refund $3,704.66.  

               In the appeal, the owner requests modification of the  order.
          The owner contends that the  Administrator  failed  to  take  into
          account the renewal lease of the  prior  tenant  and  the  subject
          building's 421a tax status.

               On October 14, 1987, the petitioner herein submitted  a  copy
          of a stipulation of settlement in which the owner agreed to refund 
          $3,340.29  and  to  withdraw  with  prejudice  its  Petition   for
          Administrative Review, the tenant agreed to withdraw the complaint 
          with prejudice, and the owner and the tenant agreed that the legal 
          regulated rent at the time the tenant  first  took  occupancy  was

               The Commissioner deems the settlement submitted a  supplement
          to the petition and  is  of  the  opinion  that  the  petition  be

          ADM. REVIEW DOCKET NO. BG 410416-RO

               Since, in the instant case,  the  Administrator  has  made  a
          finding and issued an order,  the  terms  of  the  settlement  are
          subject to careful scrutiny to determine  if  the  complainant  is
          receiving fair treatment and if the rent agreed upon is justified. 

               A careful review of the record reveals that the prior  tenant
          renewed its lease for a one year term commencing August 1, 1984 at 
          a monthly rent of $1378.00.  Accordingly, the complainant's lawful 
          stabilized rent as herein recomputed should have been $1564.03.

               (prior tenant) -  Guideline  15:   September  30,  1983  rent
          $1325.00 plus 4% for one year renewal lease = $1378.00.

               Lazare - Guideline 16:  September 30, 1984 rent $1378.00 plus 
          13.5% (6% + 7.5%) for a one year vacancy lease  =  $1564.03.   The
          rent agreed upon does not take into account  2.2%  rent  increases
          permitted pursuant to Section 421a.  The Commissioner  notes  that
          where the actual rent charged is less than the rent  with  maximum
          allowable increases, the lawful stabilization rent is  limited  to
          the rent that was charged.  

               Accordingly, the Commissioner finds that the rent agreed upon 
          in the settlement should be substituted for the  legal  stabilized
          rent as determined by the Administrator.

               The Commissioner  further  notes  that  the  complainant  was
          represented by counsel during the settlement negotiations and that 
          the complainant vacated  before  the  termination  of  the  lease.
          Therefore, the Commissioner finds  that  the  complainant  is  not
          prejudiced by the refund amount which was agreed upon.  

               Therefore, the Commissioner finds that the petition should be 
          granted to the extent of accepting the legal  stabilized  rent  as
          correct as set  forth  in  the  settlement  and  withdrawing  with
          prejudice both the complaint and the PAR.

               Since the complainant has vacated, a copy of  this  order  is
          being sent to the current tenant.

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

               ORDERED, that this petition  be,  and  the  same  hereby  is,
          granted in accordance with this order and opinion. 


                                          ELLIOT SANDER
                                          Deputy Commissioner


          ADM. REVIEW DOCKET NO. BG 410416-RO


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