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.EC510452RO
                                              :    DRO DOCKET NO.055409
               635 Realty Corp.,                   TENANT:Janet Stewart

                               PETITIONER     :
          ------------------------------------X

            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                          IN PART AND MODIFYING DRA'S ORDER

          On March 20,  1990,  the  above-named  petitioner-owner  filed  a
          Petition for Administrative Review against an order issued on March 
          12,  1990  by  a  Rent  Administrator,  concerning  the   housing
          accommodations known as 635 Riverside Drive, New York, New  York,
          Apartment No.3D, wherein the Rent Administrator determined the fair 
          market rent pursuant to the special fair market  rent  guidelines
          promulgated by the NYC Rent Guidelines Board for use in calculating 
          fair market rent appeals.  

          The Administrative Appeal is being  determined  pursuant  to  the
          provisions of Section 2522.3 (e) and (f) of the Rent Stabilization 
          Code.

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

          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.

          The tenant originally commenced this proceeding by filing a  fair
          market rent appeal application on March 17, 1985.  The tenant took 
          occupancy as the first stabilized  tenant  pursuant  to  a  lease
          commencing September 15, 1983 and expiring September 15, 1984 at a 
          monthly rent of $495.00.

          In an order issued on March  12,  1990,  the  Rent  Administrator
          granted the tenant's fair market rent appeal, adjusted the initial 
          legal regulated rent from $495.00 to  $344.39,  effective  as  of
          September 15, 1983, and determined that the tenant had paid excess 
          rent in the amount of $12,497.96, plus $198.11 excess security.














          EC510452RO
          EC510452RO



          In this petition, the owner questions the  imposition  of  treble
          damages  because  he  had  cooperated   in   all   requests   for
          documentation, as shown in the record.  The owner also states that 
          he did not own the building at the time in question.

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

          Section 2526.1 of the current Rent Stabilization Code provides that 
          any owner  found  to  have  collected  an  overcharge  above  the
          authorized rent shall be liable for a penalty equal to three times 
          the amount of such overcharge and may be assessed the  reasonable
          costs and attorney's fees of the proceeding as well as interest on 
          any overcharge which occurs after April 1,  1984.   This  section
          applies to willful violations of the Rent Stabilization  Law  and
          Code and does not apply to fair market rent appeals.  Although the 
          owner in the instant case claims that the  Administrator  imposed
          treble damages, a review of the order indicates  that  the  total
          amount determined by the  Administrator  to  be  due  the  tenant
          consisted of $12,497.96 in excess rent,  and  $198.11  in  excess
          security, without treble damages or any other penalties imposed.

          The owner also states that he did not own the building at the time 
          in question.  Pursuant to Policy Statement 93-1, when  a  current
          owner is a party to a fair market rent appeal, the DHCR shall order 
          the current owner to refund to the tenant all excess rent paid by 
          the tenant since April 1, 1984 or the commencement  date  of  the
          tenant's initial lease, whichever is later, notwithstanding  that
          all or a portion of the excess rent was collected by one or  more
          prior owners.

          DHCR registration records indicate that the current owner purchased 
          the subject building after April 1, 1984.  (A prior owner was the 
          registered owner as  of  April  1,  1984.)   Pursuant  to  Policy
          Statement 93-1, the current owner is liable for the  excess  rent
          collected from April 1, 1984 to August 31,  1989,  or  $11,652.10
          (including  excess  security).   This  order  is  issued  without
          prejudice to any action that the current owner may have against the 
          prior owner for excess rent reimbursed by the current owner which 
          were collected by the prior owner. 

          The owner is directed  to  roll  back  the  rent  to  the  lawful
          stabilized rent consistent with this decision and  to  refund  or
          fully credit against future rents over a period not exceeding six 
          months from the date of receipt of this order,  the  excess  rent
          collected by the owner.










          EC510452RO


          In the event the owner does not take appropriate action to comply 
          within sixty (60) days from the date of issuance of this order, the 
          tenant may credit the excess rent collected by the owner  against
          the next month(s) rent until fully offset.

          The owner is 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.

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

          ORDERED, that the owner's petition be, and the  same  hereby  is,
          granted in part, and that the Administrator's order be,  and  the
          same hereby is, modified in accordance with this order and opinion.




          ISSUED:




           
                                                         JOSEPH A. D'AGOSTA
                                                         Deputy Commissioner

               






    

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