DH 110052-RO
                                  STATE OF NEW YORK
                            OFFICE OF RENT ADMINISTRATION
                                     GERTZ PLAZA
                               92-31 UNION HALL STREET
                               JAMAICA, NEW YORK 11433

          APPEAL OF                              DOCKET NO.: DH 110052-RO

                                                 DISTRICT RENT OFFICE
               Van Kleeck Assoc.,                DOCKET NO.: Q 3122532-R/T

                                                 TENANT: Jesse Winley        

                                       IN PART

          On August 4, 1989, the above-named petitioner-owner filed a 
          Petition for Administrative Review against an order issued on     
          July 3, 1989, by the Rent Administrator, concerning the housing 
          accommodations known as 51-25 Van Kleeck, Queens, New York, 
          Apartment No. 3-K, wherein the Rent Administrator determined that 
          the owner had overcharged the tenant.

          The Commissioner notes that this proceeding was initiated prior to 
          April 1, 1984.  Sections 2526.1(a)(4) and 2521.1(d) of the Rent 
          Stabilization Code (effective May 1, 1987) governing rent 
          overcharge and fair market rent proceedings provide that 
          determination of these matters be based upon the law or code 
          provisions in effect on March 31, 1984.  Therefore, unless 
          otherwise indicated, reference to sections of the Rent 
          Stabilization Code (Code) contained herein are to the Code in 
          effect on April 30, 1987.

          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 on March 26, 1984 by the 
          filing of a rent overcharge complaint by the tenant.  The tenant 
          had commenced occupancy of the apartment as subtenant in December, 
          1982.  The tenant then became the lease tenant in April, 1983, for 
          a seven-month lease term, and renewed his lease until vacating the 
          apartment in September, 1988.  In answer to the complaint, the 
          owner submitted a complete rental history for the subject 

          DH 110052-RO

          In the order under appeal herein, the Rent Administrator determined 
          that the tenant had been overcharged in the amount of $8,408.00, 
          including treble damages, and directed the owner to refund such 
          overcharge to the tenant.

          In its petition, the owner contends, inter alia, that the 
          imposition of treble damages was unjust because it only bought the 
          building in March, 1984 with the assurances of the previous owner 
          that all rents at that time were correct.  With respect to the 
          actual rent calculations the owner contends that the prior tenant's 
          lease commencing on November 1, 1980 under Guidelines 12 should be 
          granted a vacancy allowance of 10%, instead of the 5% given by the 
          Administrator.  The owner further asserts that the complaining 
          tenant did not assume occupancy by assignment of the prior tenant's 
          lease as stated by the Administrator, but was in fact there 
          illegally, and that it was improper for the Administrator to reduce 
          the rent for the complaint's vacancy lease commencing April 1, 

          In his response, the tenant states that the Administrator's order 
          should be adjusted to reflect that he vacated the subject premises 
          on September 21, 1988, instead of June 30, 1989.

          The Commissioner is of the opinion that the owner's petition should 
          be granted in part and that the Administrator's order should be 

          The Commissioner finds that the owner is incorrect in its claim 
          that the lease of the prior tenant commencing November 1, 1980 
          include a 10% vacancy allowance, instead of 5%.  Under Guidelines 
          12, a 10% vacancy allowance is only available when there has been 
          no vacancy since 1975.  However, in the present case, there was a 
          vacancy in 1978 with the departure of the rent controlled tenant.
          Therefore the 5% vacancy allowance was proper.

          The Commissioner further finds that it was proper for the 
          Administrator to reduce the lawful rent for the complainant's 
          vacancy lease of April 1, 1983.  Both the prior tenant's lease and 
          the complainant's vacancy lease were executed under Guidelines 14, 
          and thus the Administrator properly used the rent in effect on 
          September 30, 1982, or $372.62, as the base rent.  However, the 
          prior tenant's lease was for two years, for a 7% increase, while 
          the complainant took a one year lease, for only a 4% increase; 
          accordingly, the lawful rent was actually decreased in this case.

          However, an examination of the record reveals that overcharges were 
          not a result of willfulness on the owner's part. The most 
          substantial part of overcharges occurred in the complainant's  
          vacancy lease commencing April 1, 1983 in which overcharges were 
          increased to $35.34 per month from $7.30 per month.  This increase 
          was the result of the former owner's taking of a second guidelines 

          DH 110052-RO

          increase during the same guidelines period, or "piggybacking."  It 
          is the policy of the DHCR, as enunciated in Policy Statement 89-2, 
          that "piggybacking" is one of the specified practices for which 
          there will be no presumption of willfulness for resulting 

          As a result of the removal of the treble damages penalty, a 
          recalculation of the rent history results in a reduction of 
          overcharges to $3,118.50, from $8,408.00, including interest on 
          overcharges since April 1, 1984.  As per the tenant's request the 
          amount of overcharges is adjusted to reflect the tenant's vacating 
          of the apartment on September 21, 1988.

          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.

          THEREFORE, pursuant to the Rent Stabilization Law and Code, it is

          ORDERED, that this Petition be, and the same hereby is granted in 
          part; and that the Administrator's order be, and the same hereby is 
          amended in accordance with this order and opinion.


                                          JOSEPH A. D'AGOSTA
                                          Acting Deputy Commissioner


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