Docket Number: BH 210181-RO
                                  STATE OF NEW YORK
                            OFFICE OF RENT ADMINISTRATION
                                     GERTZ PLAZA
                               92-31 UNION HALL STREET
                               JAMAICA, NEW YORK 11433

          APPEAL OF                              DOCKET NO.: BH 210181-RO 
             TOWER MGMT. CO.,                    D.R.O. DOCKET NO.: K 3103962-R


          On August  10,  1987,  the  above-named  petitioner-owner  filed  a
          Petition for Administrative Review against an order issued on  July
          7, 1987, by the District Rent Administrator,  10  Columbus  Circle,
          New York, New York,  concerning  housing  accommodations  known  as
          Apartment 402 at 1679 E. 3rd Street, Brooklyn,  New  York,  wherein
          the District Rent Administrator determined that the tenant had been 

          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 on March 21, 1984  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 April 1, 1983 and expiring March  31,  1985  at  a
          monthly rent of $325.00.

          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, the owner submitted  leases  for  the  subject
          apartment from June 1, 1979. 

          In  Order  Number  CDR  30,801,  the  District  Rent  Administrator
          established the lawful stabilized rent based on the owner's failure 
          to submit a complete rental history for the subject  apartment  and
          directed a refund of $1,415.67, including interest  on  overcharges
          collected after April 1, 1984, to the tenant.

          In this  petition,  the  owner  contends  that  the  District  Rent
          Administrator failed to consider the rental documentation submitted 
          by the owner.  The owner resubmits the leases  from  June  1,  1979
          with its petition and asserts that the tenant's rent was within the 
          lawful guidelines amount.
          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

          Docket Number: BH 210181-RO

          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 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 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).

          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,


          Docket Number: BH 210181-RO

          First Department, in the case of Lavanant v. DHCR, 148 A.D. 2d 185, 
          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  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.

          The lawful stabilized rent is recalculated from April  1,  1980  on
          the attached rental history chart, which is fully made  a  part  of
          this order.  The total amount of overcharge is $198.96.

          Any arrears owed by the tenant as a result of  this  order  may  be
          paid to the owner in equal monthly installments over the course  of
          the next 12 months.

          Because this determination concerns lawful rents only through March 
          31, 1985, the owner is cautioned to adjust subsequent rents  to  an
          amount no greater than that  determined  by  this  order  plus  any
          lawful increases, and to register  any  adjusted  rents  with  this
          order  and  opinion  being  given  as  the  explanation   for   the

          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 to the extent hereinabove indicated.


                                          ELLIOT SANDER
                                          Deputy Commissioner


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