FC 110220-RO
                                


                        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
                                
                                
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IN THE MATTER OF THE ADMINISTRATIVE     ADMINISTRATIVE REVIEW
APPEAL OF                               DOCKET NO.:
                                        FC 110220-RO
       MICHAEL PISTILLI,
                                        DRO DOCKET NO.:
                        PETITIONER      EI-110301-R
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  ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                                
                                
On  March  13,  1991,  the above named petitioner-owner  filed  a
Petition  for  Administrative Review against an order  issued  on
February 17, 1991, by the District Rent Administrator, concerning
housing  accommodations known as Apartment 3-C at  58-35  Granger
Street, Corona, New York, wherein the District Rent Administrator
determined that the tenant had been overcharged in the amount  of
$7,931.18, including 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 tenants on September 12, 1990.

The   tenants  took  occupancy  pursuant  to  a  one-year   lease
commencing  April  1, 1990, and expiring March  31,  1991,  at  a
monthly rent of $625.00.

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.

In response, the owner submitted a statement of withdrawal of the
complaint  signed  by  the  tenant.  However,  the  tenant  later
submitted a letter stating that she had not withdrawn it.

On  December 28, 1990, the Administrator notified the owner  that
the  complete lease history, including all leases in effect since
April  1, 1984, and documentation of all rent increases, must  be
submitted  within  21  days  of  the  notice  date.   After   the
expiration of that period, the Administrator sent a Final  Notice
of  Pending Default dated January 25, 1991, wherein it was stated
that  the  previously requested documentation must  be  submitted
within  21  days,  or  the  lawful rent would  be  determined  by
procedures  utilized  upon  a default  by  the  owner  and  that,
furthermore,  treble damages will be imposed unless the  evidence
establishes that such overcharges were not willful.

On  February 27, 1991, the Rent Administrator issued Order No. EI
110301-R,  wherein  it was determined that the  tenant  had  been
overcharged  in  the total amount of $7,931.18, including  treble
damages.   The Administrator determined a lawful rent of  $333.39
per  month for the prior tenancy commencing on February 1,  1989,
resulting in a monthly overcharge of $316.61 ($650.00 actual rent
-  $333.39 = $316.61), and an overcharge of $233.27 per month for
the  complainant's  lease  ($625.00  actual  rent  -  $391.73   =
$233.27).

In  its  petition, dated March 13, 1991, the owner contends  that
the  Administrator improperly ignored the lease history that  was
timely submitted by the owner, and failed to credit the costs  of
new  equipment  totalling $16,000.00 that was documented  in  the
material.   Enclosed  with the petition is  a  contract  for  the
installation  of new equipment and the total remodelling  of  the
kitchen and bathroom, which was signed prior to the occupancy  of
the  prior tenant.  The two-page document lists the new equipment
and specific procedures for the reconstruction of both rooms. The
renovation of the kitchen included:

          1.Open  walls  in  the  kitchen  and  remove   all
          domestic feed lines and cast iron waste lines.
          2.Replace  all  hot and cold risers  and  branches
          with copper lines using 90/10 solder.
          3.Replace all new 2" and 1 1/4 cast iron no. hub.
          4.Install kitchen cabinets.
          5.Install and connect 1-24" kitchen stove.
          6.Install  and connect to domestic water  supplies
          kitchen sink, strainer and gerber faucet.
          7.Remove all rubbish from the apartment.
          
The renovation of the bathroom included:

          To  install one complete new bathroom;  to  remove
          entire bathroom down to studding; building  a  new
          bathroom  complete with three fixtures; installing
          a new medicine cabinet with light switch; complete
          sheet  rock walls and ceilings; cement float tiles
          job   around  bathtub  area;  glue  tiles   around
          existing part of the bathroom area; change  entire
          waste and vent lines with new no-hub cast iron and
          fittings;  complete new copper water lines,  using
          controlling valves and 95-5 soldering; removal  of
          rubbish from the apartment.
          
Petitioner also includes copies of two checks to the construction
firm  for $6,000.00 and $10,000.00 respectively, front and  back,
establishing  full  payment.  Finally, the petitioner  submits  a
copy  of  its postal receipt for certified delivery on the  DHCR,
showing a date of delivery of February 11, 1991.  The tenant  did
not  respond to the petition although afforded an opportunity  to
do so.

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

Sections  20(C)(1)  of the former Code and  2522.4(a)(1)  of  the
current Code provide that where thee had been an installation  of
new   equipment   in   a   stabilized  apartment,   the   monthly
stabilization rent for said unit may be increased by  1/40th  the
cost of such equipment provided the tenant then in occupancy  has
consented thereto in writing.  In addition, the courts have ruled
that  an  increase for new equipment installed during  a  vacancy
prior  to  the  commencement  of  a  new  tenancy  or  upon   the
commencement  of a new tenancy and reflected in the  lease  rent,
the  new tenant's consent to pay such increase is implied (Matter
of  LeHavre Corp. v. Gribetz, et al., N.Y.L.J., January 20, 1971,
p.  19,  col.  8 (Sup. Ct., Queens Co., Crisona, J.);  Matter  of
Morton I. Hamberg v. CAB, N.Y.L.J., November 9, 1972, p. 18, col.
8, (Sup. Ct., N.Y. Co., Sarafite, J.).

The  record  in this case establishes that the owner  had  timely
delivered the documentation that had been requested, but that  it
was  either ignored or never seen by the Administrator, since the
order  made  no mention of them.  The material is shown  to  have
been mailed to the DHCR by certified delivery before the date  of
issuance  of the Administrator's order.  A review of the contract
for  the  work  performed establishes that all items  listed  are
consistent  with a "gut" renovation of the bathroom  and  kitchen
such  as has been found by the Commissioner to qualify for a rent
increase  under  Section  2522.4 (Accord:  Administrative  Review
Docket  No. CH 510027-RO).  Furthermore, there is nothing in  the
record that disputes the finding that such renovations have  been
satisfactorily  completed in full accordance with  the  contract.
The claim for a rent increase of $400.00 per month (1/40th of the
$16,000.00)  is thus substantiated and must be fully included  in
the  rent calculations.  As a result, the addition of $400.00 per
month  increase to the prior tenant's vacancy lease, as added  to
the  adjusted base rent, entirely eliminates the overcharges that
were found in the Administrator's order.

The calculation of the lawful rent is as follows:


1.  Prior Tenant's lease:                September 30, 1988  rent
                                   of  $278.30   +  6% guidelines
                                   increase   +  12%  vacancy   +
                                   $400.00  = $728.39.

                                   Actual rent charged of $650.00
                                   became legal rent.
                                   
2.  Complaining Tenant's lease:    Effective  April 1, 1990,  was
                                   for  $625.00  per month  which
                                   then became the legal rent.


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 twelve  (12)
equal  monthly installments.  Should the tenant vacate after  the
issuance  of  this order, said arrears shall be  payable  immedi-
ately.


THEREFORE, pursuant to the Rent Stabilization Law and Code, it is
ORDERED, that the petition be, and the same hereby is granted;
and that the Administrator's order be, and the same hereby is,
revoked.


ISSUED:




ELLIOT SANDER
                                         Deputy Commissioner
    

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