EL410404RO

                                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  S.J.R. 6586
      IN THE MATTER OF THE ADMINISTRATIVE    ADMINISTRATIVE REVIEW
      APPEAL OF                              DOCKET NO.: EL410404RO

           Rosa Pacifico,                    DRO DOCKET NO.: BK210085R

                                             TENANT: Frederick & Edna         
                               PETITIONER                  Rossi
      ------------------------------------X                             


           ORDER AND OPINION REMANDING PROCEDURE FOR FURTHER PROCESSING


      On December 21, 1990, the above-named petitioner-owner filed a Petition 
      for Administrative Review against an order issued on November 18, 1990  
      by a Rent Administrator, concerning the housing accommodations known as  
      174 Frost Street, Brooklyn, New York, Apartment No. 1R, wherein the Rent 
      Administrator determined that the owner had overcharged the tenant.

      Subsequent thereto, the tenant filed a petition in the Supreme Court 
      pursuant to Article 78 of the Civil Practice Law and Rules, in the 
      nature of mandamus, for a judgment directing the DHCR to render a 
      determination of the petitioner's administrative appeal.  By order 
      issued by Justice Aronin the tenant's petition was granted to the extent 
      of directing the DHCR to determine the owner's administrative appeal no 
      later than March 17, 1993.

      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 
      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.  

      This proceeding was originally commenced by the filing on November 9, 
      1987 of a rent overcharge complaint by the tenant.  The tenant assumed 
      occupancy of the apartment pursuant to a one year lease commencing 
      September 1, 1987 at a rent of $397.25.  

      In answer to the complaint, the owner stated that the tenant in the 
      apartment from April 1, 1985 to March 30, 1986 was Mary Wright, who paid 
      rent of $350.00 per month.  Thereafter, it was occupied by Carmine and 
      Emily Leone, who also paid $350.00 per month, and resided there from May 
      1, 1986 to april 30, 1989.  A copy of the lease for the Leones was 
      submitted with the answer, but not the lease for Mary Wright.
      In a later submission, dated July 16, 1990, the owner stated that the 
      tenant in residence prior to 1985, Michael Biondo, was rent controlled, 







          EL410404RO

      and that subsequent tenant was the owner's granddaughter Ms. Wright, who 
      resided there without a lease from April 1, 1985 to March 30, 1986 at a 
      rent of $350.00 per month.  The owner also claimed that extensive 
      repairs and renovations were made during Ms. Wright's tenancy but did 
      not include documentation.  Finally, the owner stated that Carmine and 
      Emily Leone, who assumed occupancy on May 1, 1986, were the first 
      stabilized tenants.  Enclosed with the owner's letter was a copy of a 
      three-year lease for Mr. Biondo, extending from September 1, 1981 to 
      August 31, 1984 at a monthly rent of $175.50.

      In Order Number BK210085R, the Rent Administrator established a lawful 
      rent of $217.44 for the complainant's initial lease, effective September 
      1, 1987, determined that the tenant had been overcharged and directed a 
      refund to the tenant of $19,843.46 including treble damages.  The order 
      also stated that the initial registered tenant paid rent of $175.50 per 
      month on April 1, 1984.

      In this petition, the owner contends that the order failed to take into 
      consideration the fact that the apartment was rent controlled until 
      April, 1985 and that the owner was therefore eligible for fair market 
      value increase as well as an increase for "modernization."  In addition, 
      the owner protests the Administrator's omission of an approved MCI 
      increase from the rent calculations, and the imposition of treble 
      damages.

      The tenant replied that the petition was devoid of merit and substance, 
      and that the Administrator's order should be affirmed.

      The Commissioner is of the considered opinion that this proceeding 
      should be remanded for further processing.

      An examination of the record reveals that the owners rental history is 
      at variance with the registration statements on file with the DHCR.  For 
      example, the one year vacancy lease for Mr. and Mrs. Carmine Leone 
      commencing May 1, 1986 appears to be valid, but the registrations for 
      1986 and 1987 name Mary Wright as the tenant over approximately the same 
      period pursuant to a renewal lease not cited by the owner in its rental 
      history.  For another instance, the 1985 registration states that the 
      initial registered tenant executed a renewal lease at a rent of $196.03, 
      but the owner failed to submit that lease to the Administrator.  Most 
      significant, however, is the owner's claim that the tenant in occupancy 
      when the owner filed the initial registration in 1984 (Biondo) was rent 
      controlled.  The lease submitted by the owner does not specify the 
      tenant's status, and the owner submits no documentation to support this 
      claim.  In addition, the 1984 and 1985 registration statements list that 
      tenant as rent stabilized.

      The proceeding must therefore be remanded to the Administrator for a 
      complete investigation of the rental history, including the status of 
      the tenant who was in occupancy on April 1, 1984.  The owner should be 
      afforded an opportunity which was not afforded by the Administrator to 
      explain the contradictions and inconsistencies that are apparent when 
      comparing the actual leases with the registration statements for the 
      same period.  
      In making its new determination, the Administrator must include the rent 
      increase from the owner's MCI order issued under docket number 
      DC210213OM on August 6, 1990.  Finally, the Administrator must make a 
      new determination on whether overcharges collected by the owner, if any, 


          EL410404RO

      were willful and, if so determined, to impose treble damages.

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

      ORDERED, that this petition be, and the same hereby is granted to the 
      extent of remanding this proceeding to the District Rent Administrator 
      for further processing in accordance with this order and opinion.  The 
      automatic stay of so much of the District Rent Administrator's order as 
      directed a refund is hereby continued until a new order is issued upon 
      remand.  However, the Administrator's determination as to the rent is 
      not stayed and shall remain in effect, except for any adjustments 
      pursuant to lease renewals, until the Administrator issues a new Order 
      upon remand.


      ISSUED:



                                                                  
                                      JOSEPH A. D'AGOSTA
                                      Deputy Commissioner





    

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