Docket Number: BJ 410261-RT
                                 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.:  BJ  410261-RT
                                            :  
             LEONARD SMALHEISER,               DRO DOCKET NO.: 11467        

                              PETITIONER    :  OWNER: Joseph B. Koppelman
        ------------------------------------X                           
          
          ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW,
             IN PART AND MODIFYING DISTRICT RENT ADMINISTRATOR'S ORDER

        On October  27,  1987,  the  above-named  petitioner-owner  filed  a
        Petition for  Administrative  Review  against  an  order  issued  on
        October 15, 1987, by the District Rent  Administrator,  10  Columbus
        Circle, New York, New York, concerning  the  housing  accommodations
        known as Apartment 1-C at 438 E. 13th Street, New York, NY,  wherein
        the District Rent Administrator determined that the tenant had  been
        overcharged.  

        The Commissioner has reviewed all 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 by the filing by the tenant 
        of a tenant's objection to the apartment  registration  including  a
        fair market rent appeal and a rent overcharge complaint.  The tenant 
        took occupancy pursuant to a lease commencing December 7,  1983  and
        expiring December 6, 1984 at a monthly rent of $346.00.

        In answer, the owner submitted rent records from the base  date  and
        indicated that the tenant's initial rent had included a  charge  for
        improvements.   The  owner  also  submitted  documentation  of   the
        installation of a new boiler in the subject building in 1980.

        By notices from the DHCR, the owner was requested to  submit  copies
        of  cancelled  checks  and  receipts   to   document   the   claimed
        improvements as well as a copy of an MCI order for the boiler.   The
        owner failed to respond to these notices.

        In the Order under appeal herein, the  District  Rent  Administrator
        determined the lawful stabilized rent from April 1, 1980, determined 
        that the tenant had been overcharged in the amount of $5,216.63, and 
        directed the refund of this amount to the tenant.

        In this  petition,  the  tenant  contends  that  the  District  Rent
        Administrator failed to calculate the overcharge through October 15, 
        1987, the date of issuance of the Administrator's order; failed to 

        correctly calculate the amount or interest; and  failed  to  include
        excess security or treble damages.   The  tenant  asserts  that  the
        prior tenant's rent was $177.01 while the tenant's initial rent  was
        $346.00, and that the owner has offered no evidence  to  prove  that







        Docket Number: BJ 410261-RT
        the overcharge was not willful.

        In  answer  to  this  petition,  the  owner  states  that   he   has
        recalculated the overcharge through the date of the  Administrator's
        order and refunded the overcharge to the tenant  and  that  he  will
        refund interest and excess security to the tenant.  The  owner  also
        asserts that there is no basis for an award of treble damages as the 
        tenant's initial rent included a  charge  for  improvements  to  the
        apartment and to the building for which credit was not  given;  that
        when it became apparent that the improvements would  be  disallowed,
        the owner stopped collecting rent; and that a final  adjustment  was
        made when the Administrator's order was received. 

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

        By amended order issued on  November  13,  1987,  the  Administrator
        modified  his  earlier  order  to  include  overcharge  calculations
        through November 30, 1987 and to include excess security.  Therefore 
        the Commissioner finds that these issues are moot.

        Section 2526.1(a)(1) of  the  Rent  Stabilization  Code  states,  in
        pertinent part, that where the DHCR finds that  a  tenant  has  been
        overcharged in rent it shall assess a penalty equal to  three  times
        the amount of the overcharges found  against  the  owner  (effective
        April 1, 1984) unless the owner establishes by  a  preponderance  of
        the evidence that the overcharge was  not  willful,  in  which  case
        interest shall be imposed.

        In  this  case,  the  owner  has  failed  to  document  any  alleged
        improvements to the subject apartment.  DHCR records indicate no MCI 
        order for a new boiler to the subject  building.   The  Commissioner
        finds that the owner has failed to establish by a  preponderance  of
        the evidence that the  overcharge  was  not  willful  and  therefore
        treble damages should be imposed, rather than interest.

        The total amount of  overcharge  is  recalculated  on  the  attached
        rental history chart, which is fully made a part of this order.

        This order may, upon the expiration of the period in which the owner 
        may institute a proceeding pursuant to Article Seventy-eight of  the
        Civil Practice Law and Rules, be filed and enforced by the tenant in 
        the same manner as a judgment or not in  excess  of  twenty  percent
        thereof per month may be offset against any rent thereafter due  the
        owner.

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








        Docket Number: BJ 410261-RT

        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:


                                                                      
                                        ELLIOT SANDER
                                        Deputy Commissioner
    

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