EK-610184-RO
                                
                       STATE OF NEW YORKp
            DIVISION OF HOUSING AND COMMUNITY RENEWAL
                  OFFICE OF RENT ADMINISTRATION
                           GERTZ PLAZA
                     92-31 UNION HALL STREET
                     JAMAICA, NEW YORK 11433
                                
                                
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IN THE MATTER OF THE ADMINISTRATIVE     ADMINISTRATIVE REVIEW
APPEAL OF                               DOCKET NO.:
                                        EK-610184-RO
       PAUM SALES CORP.,
                                        DRO DOCKET NO.:
                        PETITIONER      BJ-610571-R
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  ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                             IN PART
                                
                                
On  November 14, 1990, the above named petitioner-owner  filed  a
Petition  for  Administrative Review against an order  issued  on
October  25,  1990,  by a Rent Administrator  concerning  housing
accommodations  known as Apartment 5-C at 4053 Carpenter  Avenue,
Bronx,  New York, wherein the Rent Administrator determined  that
the  tenant  had  been  overcharged in the amount  of  $5,348.68,
including excess security and treble damages.

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 of a rent
overcharge complaint by the tenant on October 23, 1987.

The  tenants  took  occupancy pursuant to a one-year  lease  com-
mencing  September 1, 1986, and expiring August 31,  1987,  at  a
monthly rent of $317.06.

The  owner  was  served  with a copy of  the  complaint  and  was
directed  to submit a complete rent history from the  base  date,
including  copies  of all leases.  The owner complied  with  this
request.   Included  with  the  owner's  answer  were  bills  for
equipment  that was installed in the apartment immediately  prior
to   complainant's  occupancy,  including   a   new   stove   and
refrigerator.  The  owner also claimed that other  equipment  was
installed but did not have proof of costs or payment.


In  Order  No.  BJ  610571-R, issued on  October  25,  1990,  the
District Rent Administrator determined overcharges of $28.75  per
month on the complainant's initial lease which, as compounded  by
guidelines increases over the two subsequent lease terms resulted
in  total  actual overcharges of $1,768.39.  With the application
of  treble damages for overcharges occurring after April 1, 1984,
and  excess  security  of $43.51, total overcharges  amounted  to
$5,348.68.  The Administrator cited as the basis for the  initial
overcharges that the actual cost of the equipment was  less  than
claimed, and that the owner had improperly added a second  guide-
lines increase for the complainant's vacancy lease even though an
increase had already been taken for the same guidelines period in
the previous lease.

In its petition, dated November 14, 1990, the owner contends that
the  Rent Administrator erred by failing to include the  tax  and
delivery  charges  in  calculating the  cost  of  the  equipment.
Petitioner  also  encloses  copies of  several  other  bills  for
equipment,  including a bathroom sink and  cabinet,  as  well  as
bills for a new kitchen floor and bathroom walls and floor,  none
of  which had been submitted in the record below.  The owner also
disputes the finding of treble damages, since the owner still had
no  idea  why there was an overcharge, which proves it could  not
have been intentional.

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

Section  2522.4  (a)(1)  of the current Rent  Stabilization  Code
provides,  in  part that an owner is entitled to a rent  increase
where there has been a substantial increase of dwelling space  or
an  increase in the services, or installation of new equipment or
improvements, or new furniture or furnishings, provided in or  to
the  tenant's housing accommodation.  An owner may not,  however,
collect  a rent increase for work that constitutes normal  decor-
ating, painting or repairs.

The  owner's claim that the Administrator improperly ignored  the
cost  of  the new sink and other equipment is not correct,  since
the  owner failed to include documentation for those items in the
record  below, and it is not admissible on appeal.  However,  the
claim  that  the  stove  and  refrigerator  were  undervalued  is
correct.   The  record  shows that the  Administrator  failed  to
include  tax  and  a $15.00 delivery charge (based  on  a  $30.00
charge  for 2 deliveries to two apartments on the same day).   As
recalculated,  the total cost of the equipment  is  increased  to
$975.12 from $889.00, as follows:


        Refrigerator            $ 464.00
        Stove                     370.00
        Tax (8%)                   71.12
        Delivery                   15.00
                    Total       $ 975.12 divided by 40 = $24.38
                                  ======

The  Commissioner  also agrees with the owner's  contention  that
treble  damages  were not appropriate under the  current  circum-
stances. In the present case, the Administrator correctly  denied
the  claim  for certain items of equipment because the owner  had
failed to submit documentation of their cost in the record below.
Nevertheless, it has been held that where a rent increase is  not
authorized because of the failure to document the cost of  equip-
ment  that  was  shown  to have been installed,  such  overcharge
cannot be said to be willful (Accord: ARL 13023-K). All remaining
overcharges  are shown to be due to the compounding of  a  guide-
lines increase within the same guidelines period. This error  has
been found to be of a "hypertechnical nature" that, according  to
the  DHCR's Policy Statement 89-2, is not considered willful  and
thus should not be assessed for treble damages.

Total  overcharges are thus reduced to $1,805.46, from $5,348.68,
as  documented in the rent calculations chart affixed hereto  and
made a part hereof.

This  order may, upon the expiration of the period in  which  the
owner  may institute a proceeding pursuant to Article 78  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.

If  the owner has already complied with the Administrator's order
and there are arrears due to the owner as a result of the instant
determination, the tenant may pay off the arrears in  twenty-four
(24)  equal monthly installments.  Should the tenant vacate after
the  issuance of this order, said arrears shall be payable immed-
iately.

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

ORDERED, that the 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.

ISSUED:


                                    JOSEPH A. D'AGOSTA
                                    Acting Deputy Commissioner
    

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