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

      APPEAL OF                              DOCKET NO.: EK110347RO

                 Nathan Katz                 DRO DOCKET NO.: BF110591R

                                             TENANT: Julietha Moreno          


      On November 28, 1990, the above-named petitioner-owner timely refiled a 
      Petition for Administrative Review against an order issued on   
      September 20, 1990, by the Rent Administrator, 92-31 Union Hall Street, 
      Jamaica, New York, concerning the housing accommodations known as 47-06 
      46th Street, apartment D-4, Woodside, New York, wherein the Rent 
      Administrator determined that the tenant had been overcharged in the 
      amount of $5583.94 inclusive of interest and treble damages on the 

      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 commenced on June 1,1987 when the tenant filed a 
      complaint of rent overcharge. 

      In answer to the complaint, the owner stated that although he had 
      inadvertently collected an overcharge, he had corrected his error, 
      reduced the rent to include only guidelines increases and an increase 
      based on improvements made while the apartment was vacant and had 
      refunded to the tenant the overcharges collected.

      In Order Number ZBF110591R, the Rent Administrator determined that a 
      total overcharge inclusive of interest and treble damages, of $8576.66, 
      had been collected.  Because the evidence indicated that $2992.72 had 
      already been refunded to the tenant, the owner was directed to refund 

      In his appeal, the owner contends that the Administrator's order should 
      be reversed with respect to treble damages pursuant to Policy Statement 
      89-2 because by refunding the overcharge, the owner had established by 
      a preponderance of the evidence that the overcharge had not been 

      The tenant contends that treble damages are warranted because the owner 
      has consistently demonstrated a lack of good faith.
      The Commissioner is of the opinion that this petition should be denied.

      Section 2526.1 of the Rent Stabilization Code imposes a penalty of 
      treble damages on overcharges except where an owner establishes by a 
      preponderance of the evidence that the overcharge was not willful.  
      Policy statement 89-2 enunciates instances, including the one relied on 
      by the instant owner, where an owner will be deemed to have met his 
      burden of proving lack of willfulness by a preponderance of the evidence 
      and not be subject to treble damages.  Pursuant to Policy Statement 89- 
      2, the treble damages penalty is not applicable where an owner adjusts 
      the rent on his own within the time afforded to interpose an answer and 
      tenders a full refund including interest.

      Review of the record discloses that the owner herein adjusted the rent 
      and tendered a refund.  However, the record further reveals that the 
      owner failed to adjust the rent to the correct amount and continued to 
      collect an overcharge even after the refund was tendered.  Accordingly, 
      the Commissioner finds that the owner's actions do not meet the 
      requirements of Policy Statement 89-2 and that therefore the imposition 
      of treble damages was warranted.

      The Commissioner has determined in this Order and Opinion that the owner 
      collected overcharges of $5583.94.  This order may, upon expiration of 
      the period for seeking review of this Order and Opinion pursuant to 
      Article Seventy-eight of the Civil Practice Law and Rules, be filed and 
      enforced as a judgment or not in excess of twenty percent per month of 
      the overcharges may be offset against any rent thereafter due the owner.  
      Where the tenant credits the overcharge, the tenant may add to the 
      overcharge, or where the tenant files this Order as a judgment, the 
      County Clerk 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 issuance 
      date of the Commissioner's Order.

      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.  The owner is further directed to adjust subsequent rents to 
      an amount no greater than that determined by this order plus any lawful 

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

      ORDERED, that this petition for administrative review be, and the same 
      hereby is, denied, and the Rent Administrator is ordered be, and the 
      same hereby is, affirmed.


                                      JOSEPH A. D'AGOSTA
                                      Deputy Commissioner


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