Adm. Review Docket Number: CK 810215 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.: CK 810215 RO 
                                            :  
            MIDLAND RESIDENTIAL, INC.          DRO DOCKET NO.:              
                                                            BC 810017-S
                     PETITIONER-LANDLORD    :  TENANT: SYDNEY J. CROAN
        ------------------------------------X                           
          
           ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW

        On November 15, 1988, the above-named  petitioner-landlord  filed  a
        Petition for  Administrative  Review  against  an  order  issued  on
        October 20, 1988 by the Rent  Administrator  at  55  Church  Street,
        White Plains, New York concerning the housing  accommodations  known
        as apartment 4-E at 10 Old Mamaroneck Road, White Plains, New  York,
        wherein the Administrator found a decrease in services, namely,  the
        discontinuance of the providing of a daytime  doorman,  and  reduced
        the rent.

        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 in the administrative appeal.

        The issues  in  this  proceeding  are  whether  the  Administrator's
        finding that there had been a decrease  in  services  upon  which  a
        rent reduction should be based conformed to the facts  as  reflected
        in the record below and whether, based on that record, the effective 
        date of the rent reduction should have been the  date  specified  in
        the appealed order, May 1,1987.

        This proceeding was commenced on May 24, 1987 when the tenant  filed
        a complaint of a decrease in services, alleging the  decrease  noted
        hereinabove. The tenant requested a reduction in rent.
         
        The record indicates that on April 1,1987, a copy of  the  complaint
        was sent to the tenant's  then  landlord,  C.W.  Associates  (C.W.),
        which was the sponsor of the plan under which the  subject  building
        had undergone a conversion to a cooperatively owned  building;  C.W.
        having retained the cooperative corporation shares allocated to  the
        subject  apartment___  the  tenant  herein  not  having  elected  to
        purchase said shares. 

        In its answer to the complaint, C.W. asserted,  in  substance,  that
        the complaint could not be interposed  against  it  because  it  was
        merely the holder of unsold shares; and as such it could not  compel
        the cooperative corporation's board  of  directors  to  restore  the
        subject services.

        Thereafter, on August 9,1988, a copy of the complaint was served  on
        the petitioner, C.W.'s successor in interest to the shares allocated 
        to the subject apartment. Petitioner answered the complaint in  much
        the same fashion that C.W. had,  but  added  the  allegation,  in  a







        Adm. Review Docket Number: CK 810215 RO
        subsequent  statement,  dated  August  26,1988,  that  the   subject
        services had been restored.

        In his September 7,1988  response  to  that  statement,  the  tenant
        denied that the said services had been restored.

        In the appealed order,  the  Administrator  ruled  as  noted  above,
        reducing the rent to the level in effect  prior  to  the  last  rent
        guideline increase, effective May 1,1987:  the  first  rent  payment
        date following the date of service of the complaint on C.W. 

        In  the  Petition,  the  landlord,  in  substance,  reiterates   its
        contentions that it should not have  been  held  responsible  for  a
        decrease in services over which it  had  no  control  and,  further,
        that the rent reduction was issued in error because the services  in
        question had been restored. Moreover, the landlord argues  that  the
        effective date of the appealed order should not have been May 1,1987 
        because it had not been served with the complaint  until  August  of
        1988. 

        In his answer opposing  the  Petition,  the  tenant  asks  that  the
        Administrator's order be affirmed.

        The Commissioner is of the opinion  that  this  petition  should  be
        denied.

        Pursuant to Section 2503.4  of  the  Tenant  Protection  Regulations
        (TPR), a tenant may apply for a reduction  of  the  legal  regulated
        rent and the DHCR shall so reduce the rent for the period for  which
        it  is  found  that  the  owner  has  failed  to  maintain  required
        services.

        The Commissioner notes that it has long been the policy of the  DHCR
        to hold an individual shareholder of cooperative corporation  shares
        subject to rent reduction when a decrease in building-wide  services
        is suffered by such shareholder's sublessee. Indeed, it was so  held
        in the order and opinion issued under Administrative  Review  Docket
        Number BD 810089 RO, wherein C.W.'s appeal of an order based on  the
        same facts as those herein,  in  a  proceeding  brought  on  by  the
        complaint of several other tenants  of  the  subject  building,  was
        denied. The  Commissioner  further  finds  that  after,  in  effect,
        admitting the  decrease  in  services,  the  Petitioner  offered  no
        substantiation of their restoration  (either  below  or  on  appeal)
        prior to the issuance of the appealed order.  As  to  the  effective
        date  of  the  appealed  order,  the  Commissioner  finds  that  the
        complaint was properly served on the then landlord, C.W.,  on  April
        6, 1987 and, therefore, the  effective  date  of  the  subject  rent
        reduction was properly determined in the appealed order  to  be  May
        1,1987.

        The Commissioner notes that this order and opinion is issued without 
        prejudice to the owner's applying for a rent  restoration  order  if
        and when the facts so warrant.

        THEREFORE,  in  accordance  with   the   applicable   statutes   and
        regulations, it is

        ORDERED, that this petition be, and the same hereby is, denied,  and







        Adm. Review Docket Number: CK 810215 RO
        the Administrator's order be, and the same hereby is, affirmed,  and
        it is

        FURTHER ORDERED, that the owner shall immediately refund all  excess
        rent arising as a result of this order, or  the  tenant  may  credit
        such excess rent up to the total  amount  of  each  succeeding  rent
        payment until the excess has been recovered in full.


        ISSUED:




                                                                      
                                        JOSEPH A. D'AGOSTA
                                        Deputy Commissioner




                                                   
         
    

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