BL410146RT, BL410307RO

                                  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    SJR No. 6386
          IN THE MATTER OF THE ADMINISTRATIVE :    ADMINISTRATIVE REVIEW
          APPEALS OF                               DOCKET NO.BL410146RT
                                              :          and BL410307RO
                David J. Fleming, Tenant           DRO DOCKET No.
                & Putmam Realty Co, Owner          L3112254RT

                               PETITIONERS    :
          ------------------------------------X

           ORDER AND OPINION GRANTING OWNER'S PETITION FOR ADMINISTRATIVE 
                                    REVIEW IN PART
              AND GRANTING TENANT'S PETITION FOR ADMINISTRATIVE REVIEW
                                        

          The  above-named  parties  filed  two  separate   petitions   for
          administrative review on December 1, 1987 and December 23,  1987,
          respectively, of an order issued on November 18, 1987 by a District 
          Rent Administrator concerning the housing accommodation known  as
          Apartment 6-H, 65 Morton Street, New York, New York, wherein  the
          Administrator determined that the owner had overcharged the tenant.

          The Commissioner is consolidating these petitions and this  order
          and opinion shall be dispositive of both.

          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 appeals.  

          This proceeding was commenced on March 29, 1984 upon the filing of 
          a rent overcharge complaint.  The  tenant  stated  that  he  took
          occupancy of the subject apartment on or about March 15, 1976  at
          monthly rent of $295.00.

          In answer, the owner alleged that as a result of vacancy decontrol 
          the base date for the subject apartment was November 1, 1974.

          On October 26, 1984, the Division of Housing and Community Renewal 
          (DHCR) mailed to the owner a notice  requesting  that  the  owner
          submit to the rent agency "a DC-1 or DC-2 Notice of Initial Legal 
          Regulated Rent or Apartment Registration Form RR-1" that was served 
          on the first stabilized tenant or subsequent tenants, along  with
          proof of mailing.


          The owner attached to letters dated November 5, 1984, and October 












          BL410146RT, BL410307RO

          9, 1985, a copy of a certified mail postal receipt signed by  the
          alleged first rent-stabilized tenant.  No copy of the DC-2 notice 
          was included.

          On October 5, 1987, the Administrator sent to the owner a  "Final
          Notice of Pending Default" which rerequested adequate proof of the 
          base date.  

          The owner did not respond to this notice.

          In the order of November 19, 1987, the  Administrator  determined
          that the tenant's  initial  legal  regulated  rent  was  $251.06,
          pursuant to D.H.C.R's default procedure, and directed a refund of 
          $5,286.22  for  overcharges  accruing  through  March  31,  1983,
          including excess security.

          In its petition  for  administrative  review,  under  Docket  No.
          BL410307RO, the owner asserted that it "made a complete submission,
          including the initial lease for the subject apartment and proof of 
          service of the required DC-2  upon  the  initial  rent-stabilized
          tenant."  With its petition the owner  submitted  leases  of  the
          alleged initial rent stabilized tenant of the subject apartment for 
          the period from November 1, 1974 through October 31, 1976.

          In an order issued on March 13, 1992, the Commissioner denied the 
          owner's petition for administrative review on the  basis  of  the
          owner's failure to adequately prove the base date.  The owner only 
          submitted to the Administrator an alleged copy of  the  certified
          mail receipt signed by the alleged first rent stabilized tenant of 
          the subject apartment.  However, the owner failed to submit a copy 
          of the DC-2 notice itself, a copy of any report of decontrol or a 
          copy  of   the   relevant   rent   ledgers.    Accordingly,   the
          Administrator's determination of the complainant's initial  legal
          regulated rent by using the DHCR's default procedure was found to 
          be proper.

          In his petition for administrative review the tenant, under Docket 
          No.BL410146RT, requested an updating of the overcharges because the 
          Administrator's calculations only went through March 30, 1983.  The 
          Commissioner  on  March  13,  1992  granted  this  petition   for
          administrative  review  because  the  tenant  had  provided   the
          Administrator in the proceeding below with updated  rental  data.
          Treble damages were assessed on all overcharges  occurring  after
          April 1, 1984.  Additionally, other minor adjustments were made in 
          the calculations and the Commissioner's order of March  13,  1992
          concluded that the total overcharges through October 31, 1987 were 
          $15,898.66.

           

          Subsequently, the owner filed a petition  in  the  Supreme  Court
          pursuant to Article 78 of the Civil Practice Law and Rules seeking 






          BL410146RT, BL410307RO

          judicial review of the Commissioner's order of March 13, 1992.

          On consent, the case was remitted for  further  processing.   The
          basis for this agreement was that the record did  not  adequately
          reflect service on the owner of  the  "Final  Notice  of  Pending
          Default."  To insure that the owner's due process rights were fully 
          protected the owner was given  a  final  opportunity  to  produce
          adequate proof of the base rent date and thus avoid default.

          In the owner's supplemental pleadings dated May 11, 1993 and June 
          30, 1993, the owner supplied the DHCR  with  rent  ledgers  which
          covered the period from April 1974  (the  final  date  that  DHCR
          records reflect rent control activity in the subject apartment) and 
          November 1974 (the date that the first stabilized tenant allegedly 
          took occupancy).

          The owner was also given the opportunity  to  submit  a  complete
          rental history from the alleged base date  of  November  1,  1974
          through the date of the Administrator's order of November 18, 1987.

          The owner's response to the request for a lease history was that by 
          combining the Administrator's order of November 18, 1987 and  the
          Commissioners order of March 13, 1992 the record already contained 
          a complete lease history.

          The owner's supplemental pleadings were forwarded to the tenant.

          After careful consideration, the Commissioner is of  the  opinion
          that the owner's petition should be granted in part.

          The Commissioner is of the opinion that the rent ledgers submitted 
          by the owner on June 30, 1993 adequately prove that the tenant in 
          occupancy of the subject apartment on April 1, 1974  was  a  rent
          controlled tenant.  The ledgers go on to indicate that the rental 
          amount collected by the owner for the subject apartment  remained
          the same through October of 1974.  Further, the ledger sheet  for
          the subject apartment has the name of the rent controlled  tenant
          with a line through it, the name of  the  first  rent  stabilized
          tenant substituted and the letters "D/C" plainly displayed.   The
          owner asserts that the letters "D/C"  denotes  that  the  subject
          apartment was then decontrolled.

          Accordingly,  the  Commissioner  concludes  that  the  owner  has
          adequately proven that the base date for the subject apartment was 
          November 1, 1974.  Since the record  contains  a  complete  lease
          history from  November  1,  1974,  the  default  method  for  the
          computation of overcharges may not be employed.

          However, the recomputation of the rental history of this apartment, 
          as indicated in the attached calculation  chart,  shows  that  an
          overcharge occurred.













          BL410146RT, BL410307RO

          The Commissioner notes that the unusual rent history as reflected 
          in  the  calculation  chart  is  tenant  supplied   and   without
          contraindication by the owner.

          The Commissioner is of the opinion that the tenant's petition 
          should be granted.

          As stated in the Commissioner's prior order of March 13, 1992, the 
          Administrator should have updated the overcharges through October 
          31, 1987.  The Administrator requested updated  rent  information
          from the tenant and received a response.  This response was  then
          forwarded to the owner who did not challenge the accuracy of  the
          rent figures supplied by the tenant.

          The Commissioner notes that  in  the  "Final  Notice  of  Pending
          Default," dated October 5, 1987, the owner was informed that treble 
          damages "will be imposed on any overcharge occurring after April 1, 
          1984 for which the owner fails to satisfy the Division  that  the
          overcharge was not willful."  It is noted that although the owner 
          claimed it was not served with this notice in the proceeding before 
          the  Rent  Administrator,  it  was  served   with   said   notice
          during the appeal  processing  when  it  was  again  afforded  an
          opportunity to submit a complete rental history.  As the owner did 
          not establish that the overcharges collected were not willful, the 
          Commissioner finds that treble damages should be assessed  as  to
          overcharges collected after April 1, 1984.

          The owner is directed to reflect the findings and  determinations
          made in this order on all future registration statements, including 
          those for the current year if not already filed, citing this Order 
          as the basis for the change.  Registration statements already  on
          file, however should not be amended to reflect the  findings  and
          determinations made in this order.  The owner is further directed 
          to adjust subsequent rents to an  amount  no  greater  than  that
          determined by this order plus any lawful increases.

          The Commissioner has determined in this Order and Opinion that the 
          owner collected overcharges of $4,604.38.  This Order  may,  upon
          expiration of the period for seeking review  of  this  Order  and
          Opinion pursuant to Article Seventy-eight of the Civil Practice Law 
          and Rules, be filed and enforced as a judgment or not in excess of 
          twenty percent per month of the overcharge may be offset  against
          any rent thereafter due the owner.  Where the tenant credits the 



          overcharge, the tenant may add to the overcharge, or where the 
          tenant files this Order as a judgment, the County Clerk may add to 
          the overcharge, interest at the rate payable on a judgment pursuant 
          to Section 5004 of the Civil Practice  Law  and  Rules  from  the
          issuance date of the Rent Administrator's Order to  the  issuance
          date of the Commissioner's Order.






          BL410146RT, BL410307RO


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

          ORDERED, that the owner's petition for administrative review  be,
          and the same hereby is, granted in part, and the tenant's petition 
          for administrative review be, and the same hereby is, granted and 
          the Administrator's order be, and the same hereby is, modified in 
          accordance with this order and opinion.




          ISSUED:





           
                                                      JOSEPH A. D'AGOSTA
                                                      Deputy Commissioner
           






    

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