STATE OF NEW YORK
                          OFFICE OF RENT ADMINISTRATION
                                   GERTZ PLAZA
                             92-31 UNION HALL STREET
                             JAMAICA, NEW YORK 11433

      APPEAL OF                              DOCKET NO.CB110372RO

         Winston House Associates         :  DISTRICT RENT OFFICE
                                             DOCKET NO.
                                             Q3120802R, CDR32390
                                             TENANT: Maureen Mc Donagh
                            PETITIONER    : 


      On February 5, 1988, the above-named petitioner-owner filed a Petition 
      for Administrative Review against an order issued on January 20, 1988,  
      by the Rent Administrator, 10 Columbus Circle, New York, concerning the 
      housing accommodations known as 167-10 Crocheron Avenue, Apartment 3-0, 
      Flushing, New York, wherein the Rent Administrator determined that the 
      owner had overcharged the tenant.

      The Administrative Appeal is being determined pursuant to the provisions 
      of Section 2526.1 of the Rent Stabilization Code.

      The issue herein is whether the Rent Administrator's order was 

      The Commissioner has reviewed all of 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 in March 1984 of 
      a rent overcharge complaint.  The tenant had commenced occupancy in 
      September 1978 at a rent of $220.00.

      In answer to the tenant's complaint, the owner stated that when it 
      purchased the subject premises in June 1980, it had obtained only 
      current leases.  The owner stated also that the complainant was the 
      second stabilized tenant in the subject apartment but that it had no 
      information on the first statilized tenant.  With its answer, the owner 
      submitted a current rent roll, a copy of the rent control registration 
      card, the Landlord's Report of Statutory Decontrol(R-42) and the 
      complainant's lease history.


      The owner was notified that failure to submit a complete rental history 
      would result in a default.

      In the order here under review, the Rent Administrator determined that, 
      due to the owner's failure to submit a complete rental history, the 
      tenant had been overcharged in the amount of $3,418.00 inclusive of 
      excess security plus interest on the overcharge occuring on or after 
      April 1, 1984.

      In this petition, the owner contends in substance that it did not 
      default as it submitted all the rent records it had.

      Although afforded the opportunity to do so, the tenant did not respond 
      to the petition.

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

      Section 42A of the former Rent Stabilization Code requires that an owner 
      retain complete records for each stabilized apartment in effect from 
      June 30, 1974 (or the date the apartment became subject to rent 
      stabilization, if later) and to produce rent records for more than four 
      (4) years prior to the most recent registration, and concomitantly, 
      established a four year limitation on the calculation of rent 

      It has been the DHCR's policy that overcharge complaints filed prior to 
      April 1, 1984, are to be processed pursuant to the Law or Code in effect 
      on March 31, 1984.  (See Section 2526.1 (a) (4) of the current Rent 
      Stabilization Code.)  The DHCR has therefore applied Section 42A of the 
      former Code to overcharge complaints filed prior to April 1, 1984, 
      requiring complete rent records in these cases.  In following this 
      policy, the DHCR has sought to be consistent with the legislative intent 
      of the Omnibus Housing Act (Chapter 403, Laws of 1983), as implemented 
      by the New York City Conciliation and Appeals Board (CAB) the 
      predecessor agency to the DHCR, to determine rent overcharge complaints 
      filed with the CAB prior to April 1, 1984, by applying the law in effect 
      at the time such complaints were filed so as not to deprive such tenants 
      of their rights to have the lawful stabilized rent determined from the 
      June 30, 1974 base date and so as not to deprive tenants whose 
      overcharge claims accrued more than four years prior to April 1, 1984 of 
      the right to recover such overcharges.  In such cases, if the owner 
      failed to produce the required rent records, the lawful stabilized rent 
      would be determined pursuant to the default procedure approved by the 
      Court of Appeals in 61 Jane Street Associates v. CAB, 65 N.Y.2d 898, 493 
      N.Y.S. 2d 455 (1985).


      However, it has recently been held in the case of J.R.D. Mgmt. v. 
      Eimicke, 148 A.D.2d 610. 539 N.Y.S. 2d 667 (App. Div. 2d Dept., 1989). 
      motion for leave to reargue or for leave to appeal to the Court of 
      Appeals denied (App. Div. 2d Dept., N.Y.L.J., June 28, 1989.p.25, 
      col.1), motion for leave to appeal to the Court of appeals denied (Court 
      of Appeals, N.Y.L.J., Nov.24, 1989, p.24, col.4)., motion for leave to 
      reargue denied (Court of Appeals, N.Y.L.J., Feb. 15, 1990, p.25, col.1), 
      that the Law in effect at the time of the determination of the 
      administrative complaint rather than the Law in effect at the time of 
      the filing of the complaint must be applied and that the DHCR could not 
      require an owner to produce more than four years of rent records.
      Since the issuance of the decision in JRD, the Appellate Division, First 
      Department, in the case of Lavanant v. DHCR, 148 A.D.2d 185, 544 
      N.Y.S.2d 331 (App. Div. 1st Dept. 1989), has issued a decision in direct 
      conflict with the holding in JRD.  The Lavanant court expressly rejected 
      the JRD ruling finding that the DHCR may properly require an owner to 
      submit complete rent records, rather than records for just four years, 
      and that such requirement is both rational and supported by the Law and 
      legislative history of the Omnibus Housing Act.

      Since in the instant case the subject dwelling unit is located in the 
      Second Department, the DHCR is constrained to follow the JRD decision in 
      determining the tenant's overcharge complaint, limiting the requirement 
      for rent records to April 1, 1980.  An examination of the rent records 
      from April 1, 1980 discloses that no rent overcharge occurred at that 
      time.  However, examination of subsequent rent records discloses that an 
      overcharge was collected beginning September 1, 1983 where although the 
      lease recites the correct rental amount ($283.14), the owner (see RR-1 
      and rent roll submitted by the owner) and the tenant concur that the 
      actual rent paid was $294.20.

      Accordingly, the Commissioner has modified the Administrator's 
      calculations in the rent calculation chart attached hereto and fully 
      made a part of this order.

      The Commissioner establishes the legal stabilized rent at $315.96 as of 
      August 31, 1986.  The Commissioner has determined in this order and 
      Opinion that the owner collected overcharges of $444.57.  Upon 
      expiration of the period for seeking review of this Order and Opinion 
      pursuant to Article 78 and the Civil Practice Law and Rules, 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 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 Commissioner's order.


      The owner is further 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.

      THEREFORE, in accordance with the Appellate Division ruling in JRD, it 

      ORDERED, that this petition for administrative review be, and the same 
      hereby is, granted in part and that the order of the Rent Administrator 
      be, and the same hereby is, modified, in accordance with this order and 


                                          JOSEPH A. D'AGOSTA
                                          Deputy Commissioner


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