ADM. REVIEW DOCKET NO.: BI 410300 RO

                                  STATE OF NEW YORK
                      DIVISION OF HOUSING AND COMMUNITY RENEWAL
                            OFFICE OF RENT ADMINISTRATION
                                     GERTZ PLAZA
                               92-31 UNION HALL STREET
                               JAMAICA, NEW YORK 11433

          ------------------------------------X 
          IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
          APPEAL OF                              DOCKET NO.:  BI  410300  RO
                                                 D.R.O. DOCKET NO.:     
                                              :       L      3111649       R
                REBA SHABOT,                           
                                           PETITIO

                                              
                                 PETITIONER   :  
          ------------------------------------X 

            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
            IN PART

               On September 28, 1987, the above-named petitioner-owner filed 
          a Petition for Administrative Review against an  order  issued  on
          August 28, 1987, by the District Rent Administrator,  10  Columbus
          Circle, New York,  New  York,  concerning  housing  accommodations
          known as Apartment 4A at 203 West 94th Street, New York, New York, 
          wherein the District Rent Administrator determined that the tenant 
          had been overcharged. 

               The Commissioner notes that  this  proceeding  was  initiated
          prior to April 1, 1984.  Sections 2526.1(a)(4)  and  2521.1(d)  of
          the Rent Stabilization Code (effective May 1, 1987) governing rent 
          overcharge  and  fair  market  rent   proceedings   provide   that
          determination of these matters be  based  upon  the  law  or  code
          provisions  in  effect  on  March  31,  1984.   Therefore,  unless
          otherwise  indicated,  reference   to   sections   of   the   Rent
          Stabilization Code (Code) contained herein  are  to  the  Code  in
          effect on April 30, 1987. 

               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 originally commenced 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 August 1, 1980 and expiring July 31, 1981 at a  monthly
          rent of $600.00.

               In Order Number CDR 31,236, the District  Rent  Administrator
          determined  the  lawful  stabilized  rent  utilizing  the  default
          procedure based on the owner's failure to submit a complete rental 
          history for the subject apartment, determined that the tenant  had


          been overcharged in the amount of $4,144.70, including interest on 
          overcharges collected on or after April 1, 1984, and directed  the






          ADM. REVIEW DOCKET NO.: BI 410300 RO
          refund of such amount to the tenant. 

               In this petition, the owner contends that the  District  Rent
          Administrator's order is arbitrary, capricious,  unreasonable  and
          confiscatory; that the Administrator's order states that the  rent
          would  be  determined  under  method  number  1  of  the   default
          procedure, but this was not the case; that similar  apartments  in
          the  area  rent  for  at  least  $1,000.00;  that  the  tenant  is
          collecting at least $650.00 from people who  use  and  occupy  two
          rooms of the  apartment;  that  interest  should  not  be  imposed
          because the owner has shown good faith by paying lump sums to  the
          tenant  pending  determination  of  the  petition;  and  that  the
          Administrator's rent calculation ends on September  30,  1984  and
          does not include a two year renewal lease from October 1, 1984  to
          September 30, 1986 at a monthly rent of $684.95.  The  owner  also
          submits with this petition a statement dated March 12, 1987 signed 
          by  the  parties  indicating  that  the  parties  had  reached   a
          settlement and requesting withdrawal of  the  tenant's  overcharge
          complaint. 

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

               Section 2520.13 of the Rent Stabilization Code provides  that
          a tenant may withdraw any complaint pending before the DHCR  based
          upon a negotiated settlement between  the  parties  and  with  the
          approval of the DHCR or a court of  competent  jurisdiction  where
          the tenant is represented by counsel.  

               In this case, the  owner  submits  a  copy  of  a  settlement
          agreement with its petition but  offers  no  explanation  for  not
          having submitted this document to  the  Administrator.   Moreover,
          the settlement as stated  in  the  agreement  does  not  meet  the
          requirements of Section 2520.13 of the Rent Stabilization Code  in
          that it was not entered into with the approval of the  DHCR  or  a
          court of competent jurisdiction where the tenant  was  represented
          by counsel.  Therefore this settlement will not be accepted.   

               Section 42A of the Rent Stabilization Code requires  that  an
          owner retain complete rent records for each  stabilized  apartment
          from June 30, 1974 to date and  produce  them  to  the  DHCR  upon
          demand.  If the apartment was decontrolled from the  Rent  Control
          Law after June 30,  2974,  the  owner  must  provide  satisfactory
          documentary evidence of the apartment's date of decontrol. 

               DHCR has adopted a procedure  for  determining  an  apartment
          rent where an owner does not provide a complete  rent  history  of
          the apartment.  In such cases the rent is  calculated  to  be  the
           





          lowest of the following amounts:  1) the  lowest  stabilized  rent
          for a similar apartment with the same  number  of  rooms;  2)  the
          current tenant's  initial  rent  minus  a  guideline  and  vacancy
          allowance; 3) the prior tenant's last rent, if known.
               






          ADM. REVIEW DOCKET NO.: BI 410300 RO
               A review of the record in the instant case discloses that the 
          Administrator properly implemented  the  default  procedure  as  a
          result of the owner's failure to provide a complete rent history.

               While the Administrator's order incorrectly states the method 
          1 would be utilized, the Administrator properly utilized method  2
          (the  tenant's  initial  rent  minus  a  guideline   and   vacancy
          allowance) which  resulted  in  the  lowest  rent.   Therefore  no
          modification of the Administrator's rent calculation is warranted.

               The Commissioner finds that the rents for similar  apartments
          in this area, as  well  as  the  owner's  unsupported  allegations
          regarding the tenant's collection of rent from other parties, have 
          no bearing on the determination  of  the  lawful  stabilized  rent
          pursuant to the default procedure. 

               Section 216-516 of the Rent Stabilization Law  provides  that
          where an owner has been found to have overcharged a tenant, treble 
          damages shall  be  imposed  unless  the  owner  establishes  by  a
          preponderance of the evidence that the overcharge was not willful, 
          in which case interest shall be imposed.

               The Commissioner finds that the owner's  contention  that  it
          acted in good faith has no bearing on the imposition of  interest,
          which is mandated by law.  Therefore the imposition of interest in 
          this case is affirmed. 

               The Administrator's issued August 28, 1987  includes  a  rent
          calculation up to September 30, 1984.  In its petition, the  owner
          advises that the tenant was given a two year  renewal  lease  from
          October 1, 1984 to  September  30,  1986  at  a  monthly  rent  of
          $684.95.  The Commissioner finds that the rent for this lease term 
          did not exceed the  lawful  guideline  increase  over  the  lawful
          stabilized rent established by the  Administrator  for  the  prior
          lease and therefore the tenant was not overcharged for this  lease
          term.

               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 the District  Rent  Administrator's  order  be
          and  the  same  hereby  is  modified  to  the  extent  hereinabove
          indicated. 

          ISSUED:








          ADM. REVIEW DOCKET NO.: BI 410300 RO





                                                                        
                                          ELLIOT SANDER
                                          Deputy Commissioner



                                          






























    

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