Adm. Review Docket Number: CA 410212-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.: CA 410212-RO
                                              
             FAME COMPANY,                     DRO DOCKET NO.: BE 410071-B

                              PETITIONER     
        ------------------------------------X                             
                                         
          ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW,
                                      IN PART 

        On January 14, 1988,  the  above  named  petitioner  owner  filed  a
        Petition for  Administrative  Review  against  an  order  issued  on
        December 10,  1987,  by  the  Rent  Administrator  at  Gertz  Plaza,
        Jamaica, New York, concerning the housing  accommodations  known  as
        240 East 83rd Street, New York, New York wherein  the  Administrator
        granted rent reductions  based  on  a  finding  of  a  building-wide
        reduction of services. 

        The issue in these proceedings is whether the Administrator's  order
        was correct.

        The applicable law is Section 2523.4 of the Rent Stabilization  Code
        and Section 2202.16 of the Rent and Eviction Regulations.

        The tenants commenced these proceedings by filing a joint  complaint
        alleging that certain building-wide services were not being provided 
        or maintained.  The tenant asserted that security was inadequate  in
        that the building did not have an on or off premise  superintendent,
        that the vestibule door; lock and supporting wall were not  properly
        installed; that the  intercom  system  did  not  function  for  many
        apartments, compelling the tenants to leave the apartment to  answer
        the door; and that the roof and  basement  doors  were  not  locked.
        They also complained that the lack of a superintendent  resulted  in
        poor  building  maintenance  and  long  delays  in  making  repairs,
        including repairs of broken public hallway floor tiles and that  the
        superintendent named on the sign on the main floor had been dead for 
        two years.

        The owner responded  that  the  entrance  door  and  lock  had  been
        repaired in January 1987 and were operating properly, but  that  the
        wall would be repaired shortly; that the roof door, by law,  is  not
        supposed to be locked; that the basement door was kept  unlocked  to
        allow access  to  Con  Edison  and  for  other  services,  that  the
        superintendent lived across the street; that his name and phone 






          Adm. Review Docket Number: CA 410212-RO

        number are posted,  and  that  he  performs  all  janitorial  duties
        properly.  The owner also asserted that repair and maintenance 
        problems should properly be reported to the owner  and  not  to  the
        superintendent.  The owner also alleges that the  building  was  due
        for new linoleum tiles in stairways and hallway  floor.   Concerning
        the intercom,  the  owner  asserted  that  problems  were  addressed
        promptly by the owner's contractors  upon  receipt  of  notification
        from the tenants.

        In support the owner submitted  invoices  of  services  provided  on
        various dates by the owner's repairmen and locksmith.

        An inspection was conducted on September 15, 1987 by a member of the 
        Division's inspection staff.  The inspector reported that  a  notice
        was posted in the hallway noting the address for the  superintendent
        for the building; that the lobby and  doors  were  clear;  that  the
        basement was unlocked, and that the public hallways did not  require
        painting.  However, the inspector confirmed that there  were  broken
        and loose floor tiles on the 2nd and 4th floors and  on  the  stairs
        between the 1st and 2nd floors.

        A follow-up inspection was  conducted  on  November  2,  1987.   The
        inspector reported that a spot check found the intercom  system  not
        working in apartment 3B and 1C; that there  was  no  evidence  of  a
        defective entrance door wall; that the building door was  secure  at
        the time of the inspection; that the inside  hallway  basement  door
        was unlocked but that the rear basement door was locked and secured, 
        that the roof door had a latch lock; that the sidewalk and  building
        public areas needed to be cleaned;  and  that  the  superintendent's
        name and phone number were posted, as alleged by the owner.

        On December 10, 1987 the Administrator issued  orders  reducing  the
        rents for rent controlled tenants by $11.00 for inoperative intercom 
        system ($4.00); for  dirty  public  areas  inside  and  outside  the
        building ($3.00); and for the broken and loose tiles in hallways and 
        stairs ($4.00).  The rents for rent stabilized tenants were  reduced
        to the level in effect prior to the last  rent  guidelines  increase
        for each tenant which commenced before the effective date  of  these
        rent reductions, August 1, 1987.

        The petitioner challenges the Administrator's determination  on  the
        grounds that the Administrator failed to notify  the  owner  of  the
        inspection, even though the tenants were allegedly notified, and  to
        afford the  owner  the  opportunity  to  review  the  District  Rent
        Administrator's file and inspection report in order to  prepare  the
        appeal.  The petitioner also requests a  hearing  to  "confront  the
        evidence" and "be afforded an opportunity to respond to the findings 
        of  the  inspector  and  to  cross   examine   the   District   Rent
        Administrator's inspector." 

        The petitioner also argues that the Administrator  went  beyond  the
        limit of the tenants' complaint in finding the public  areas  inside
        and outside the building to be dirty.








          Adm. Review Docket Number: CA 410212-RO

        The petitioner further argues that defective floor tiles  was  a  de
        minimus condition which could not justify building-wide rent 
        reductions.  The petitioner claims that  the  installation  of   new
        floor tiles commenced on January 7, 1988.

        The petitioner's argument of a denial of due process for failure  to
        serve notice of the inspection or to have the owner present,  or  to
        serve copies of the inspection reports are rejected.  The Division's 
        procedures do not require the Division to  give  parties  notice  of
        inspections unless, in the Division's discretion, their presence  is
        required, nor to apprise the parties of the results.   Moreover  the
        reports, prepared by rent  agency  employees,  not  parties  to  the
        proceeding, and not adversaries to either the owner  or  the  tenant
        were  properly  placed  in  the  record  for  consideration  by  the
        Administrator and were entitled to substantial weight.

        With regard to the request for a hearing the Commissioner notes that 
        the Rent Stabilization Code does not require  the  Administrator  to
        hold a hearing.  In the absence of  such  a  mandate  all  that  due
        process requires is  that  reasonable  notice  be  afforded  to  the
        parties  to the proceedings and that they  have  an  opportunity  to
        present their objections.  The record indicates that the  petitioner
        had ample opportunity and did, in fact, submit substantial material. 
        Accordingly it cannot successfully claim  that  it  was  denied  due
        process.

        Addressing  specific  items,  the  Commissioner  concurs  with   the
        tenants' argument to the owner's PAR that their claim of  inadequate
        maintenance and janitorial services sufficiently alerted  the  owner
        that a finding of dirty public areas inside and outside the premises 
        could ensue, providing a basis for rent reductions.

        The Commissioner also rejects the owner's  characterization  of  the
        missing and broken floor tiles in public areas as de  minimus  items
        which did not warrant a finding of a reduction of services.  On  the
        contrary, the condition constituted a hazard to the tenants'  safety
        requiring immediate corrective action.  The petitioner concedes that 
        repairs did not commence until after issuance of the Administrator's 
        determination.   Moreover,  the  Courts  have  held  that  once  the
        Division determines that a diminution of services has occurred,  the
        Division must order rent reductions.  Hyde Park Gardens   vs   DHCR,
        140 AD 2d 351, 527 NYS 2d 841 (AD 2nd Dept.) affd., 73  NY  2d  998,
        541 NYS 2d 345 (Ct App. 1989).

        The petitioner is correct, however, that the finding of a  defective
        intercom system building-wide should not have ensued from  a  report
        that confirmed the existence  of  the  problem  in  two  apartments.
        Accordingly, a defective intercom is revoked as  a  basis  for  rent
        reduction, except in the two  apartments  where  the  condition  was
        confirmed (3B and 1C).  

        For rent controlled tenants, the rent is partially restored, in  the
        amount of $4.00 per month effective January 1, 1988.  Any arrears 






          Adm. Review Docket Number: CA 410212-RO

        owed the owner by rent controlled tenants as a result of this  order
        may be paid in equal monthly installments over  the  course  of  the
        next six months.

        For rent stabilized apartments, the Administrator's order is amended 
        to delete the defective intercom system as  a  basis  for  the  rent
        reduction.  However, as a rent reduction may  be  granted  based  on
        any service decrease, the rent reductions remain in full  force  and
        effect,  predicated  on  the  remaining  service  reductions  found,
        without prejudice to the owner's right to apply for rent restoration 
        in the prescribed manner, if  not  already  done  so  based  on  the
        restoration of all services.

        The owner is reminded  of  its  continuing  obligation  to  maintain
        services in the absence of a specific order from the  Division.   If
        the owner has failed to repair and maintain the intercom system, the 
        tenants may refile their complaint with the Administrator,  and  are
        advised to refer to the Administrator's order below.

        THEREFORE,  in  accordance  with  the   provisions   of   the   Rent
        Stabilization Code, the Rent & Eviction Regulations, Chapter 403  of
        the Laws of 1983 and Chapter 102 of the Laws of 1984, it is

        ORDERED, that the owner's petition be and the same is granted to the 
        extent of modifying the  Administrator's  rent  reduction  order  to
        delete a defective intercom system as a basis for building-wide rent 
        reductions,  as  provided  above.   In  all  other   respects,   the
        Administrator's order is affirmed. 

        ISSUED:



                                                                      
                                        ELLIOT SANDER
                                        Deputy Commissioner
    

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