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

     APPEAL OF                                ADMINISTRATIVE REVIEW
                                          :   DOCKET NO. FH810200RO
        SPENCER MANAGEMENT CORP.              DRO DOCKET NOS. EG910003RP       
                                          :                   WNR85S46R
                            PETITIONER        TENANTS:  PATRICIA & RODOLFO DIAZ


     On August 15, 1991, the above-named petitioner-owner timely refiled a 
     Petition for Administrative Review of an order issued on April 11, 1991, 
     by the District Rent Administrator, 55 Church Street, White Plains, New 
     York, concerning housing accommodations known as 92 Cooper Drive, 
     apartment 1A, New Rochelle, New York.

     The issue in this proceeding is whether District 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 issues 
     raised by the administrative appeal.

     This proceeding was commenced on December 2, 1985 by the tenant's filing 
     of a rent overcharge complaint, asserting that they formerly living in 
     Apartment 1B at 96 Cooper Drive (a nearby building of the same building 
     complex, owned by the same landlord), where they paid $460.00 per month 
     pursuant to a lease which had a term of from May 1, 1982 to April 30, 
     1984; that on or about December 1, 1983 they moved from there to Apartment 
     1A at 92 Cooper Drive; that they signed a lease for that apartment for the 
     period from December 1, 1983 to November 30, 1985 at the same rent 
     ($460.00 per month), and that their rent was later increased to reflect 
     the installation of a major capital improvement.  The tenants also said 
     that the prior tenant of Apartment 1A had been paying only $310.00 per 

     On November 14, 1986 the District Rent Administrator issued order number 
     WNR85S546R finding that an overcharge had occurred, in that the rent for 
     the subject tenants upon their taking occupancy of Apartment 1A should 
     have been established at the prior tenant's rent of $310.00 per month, as 
     there was no guideline increase in effect at that time.  The order 
     directed the owner to roll back the rent and refund the overcharge in the 
     total amount of $5,255.00 through October 31, 1986.  Treble damages were 
     not imposed.
     The landlord filed an appeal of that order, receiving Administrative 
     Review Docket Number AL810727RO.  On May 30, 1990 the Commissioner issued 

          DOCKET NO.:  FH810200RO

     an Order and Opinion under that docket number remanding the proceeding to 
     the Rent Administrator.

     In the May 30, 1990 remand order the Commissioner noted that the landlord 
     had asserted that the last rent of the prior tenant of Apartment 1A had 
     been $290.00 (rather than the $310.00 used the Administrator in the 
     November 14, 1986 order).  The Commissioner noted that the $290.00 figure 
     was supported by documents submitted by the landlord.  Accordingly the 
     proceeding was remanded "for the purpose of recalculating the lawful rent 
     and for the issuance of a new order determining the issues."

     On April 11, 1991 the Administrator issued the order herein under appeal, 
     using $290.00 as the last rent of the prior tenant and imposing treble 
     damages on the overcharges collected between December 1, 1983 and November 
     30, 1985, finding a total overcharge of $14,179.56 through October 31, 
     1986, including treble damages.

     On appeal, the owner states, in substance, that the Commissioner on May 
     30, 1990 had ordered the District Rent Administrator merely to recalculate 
     the lawful rent, and the Commissioner did not make a finding that the rent 
     was $290.00.  The owner further states that the District Rent 
     Administrator recalculated the overcharge instead of the lawful rent and 
     ordered the owner to pay treble damages to the tenant.  The owner quotes 
     in his appeal from the remand proceeding to the rent administrator, as 

               "The Commissioner is of the opinion that the 
               proceeding should be remanded to the Rent 
               Administrator for the purpose of fully recalculating 
               the lawful rent in view of the landlord's assertion 
               and the documents it submits."
                                        . . .

               "Ordered that this proceeding be and the same hereby 
               is remanded to the Rent Administrator for the purpose 
               of recalculating the lawful rent."

     In short, the petitioner asserts that the Administrator should have 
     recalculated the rent rather than relying on the Commissioner's mention of 
     $290.00; that imposing treble damages was beyond the scope of the remand; 
     and that the overcharge, if any, was not willful.

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

     The Commissioner notes with great interest that the petitioner failed to 
     quote the next phrase of the second paragraph quoted above, namely: "and 
     for the issuance of a new order determining the issues."  Therefore, the 
     remand order was clearly broad enough to allow a new determination of all 
     issues, including the issue of treble damages.  

     Furthermore, the Commissioner in the prior order did make a finding with 
     request to the  $290.00 rent based on the evidence submitted by the owner.  
     Indeed the purpose of the remand was to recalculate the rent from $290.00 
     rather than from the $310.00.  Clearly the recalculation of the rent 
     necessitated the recalculation of the overcharges.

          DOCKET NO.:  FH810200RO

     Section 2506.1 (formerly 71(a)) of the Tenant Protection Regulations 
     provides that:   

               "Any landlord who is found by the Division, after a 
               reasonable opportunity to be heard, to have collected 
               any rent or other consideration in excess of the legal 
               regulated rent shall be ordered to pay to the tenant 
               a penalty equal to three times the amount of such 
               excess.  If the landlord establishes by a 
               preponderance of the evidence that the overcharge was 
               neither willful nor attributable to his negligence, 
               the Division shall establish the penalty as the amount 
               of the overcharge plus interest at the rate of 
               interest payable on a judgment pursuant to Section 
               5004 of the Civil Practice Law and Rules, and the 
               order shall direct such a payment to be made to the 

     Therefore, the burden is on the landlord to prove the overcharge was 
     neither willful nor negligent.  The record is devoid of any such proof.

     The amount of guideline/vacancy increases are determined by the guidelines 
     in effect on the commencement date of the new lease, not those in effect 
     on the date the prior tenant vacated.  The Rent Administrator properly did 
     not allow guideline/vacancy increases because there were 0% 
     guideline/vacancy increases when the tenant moved in.  While it is true 
     that the tenants requested a new apartment, the landlord had no right to 
     raise the rent of apartment 1A at a time when the relevant Rent Guidelines 
     Order clearly stated that rents could not be raised.  Therefore, treble 
     damages were proper.

     THEREFORE, in accordance with the Tenant Protection Regulations and the 
     Emergency Tenant Protection Act, it is 

     ORDERED, that this petition be, and the same hereby is denied, and the 
     District Rent Administrator's April 11, 1991 order be, and the same hereby 
     is affirmed.


                                                    JOSEPH A. D'AGOSTA
                                                    Deputy Commissioner 


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