FK 110192 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

      ------------------------------------X 
      IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
      APPEAL OF                              DOCKET NO. FK 110192 RO

                                          :  DRO DOCKET NO. BI 110260 R
           Loumat Realty Company,
                                             TENANT: Michael Silvers          
              

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

          ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                                     IN PART

      On November 12, 1991, the above-named petitioner-owner filed a Petition 
      for Administrative Review against an order issued on       October 24, 
      1991, by the Rent Administrator concerning the housing accommodations 
      known as 69-11 Yellowstone Boulevard, Forest Hills, New York, Apartment 
      No. B52, wherein the Rent Administrator determined that the owner had 
      overcharged the tenant.

      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.  

      On January 23, 1974 the subject apartment was decontrolled, based on a 
      finding that the tenant was not occupying the premises as his primary 
      residence.  All leases and renewals offered to the tenant by the owner 
      during the period commencing May 29, 1974 and terminating April 1, 1984, 
      when the registration requirement was initiated, were in conformance 
      with rent stabilization.  On June 1, 1984 the owner filed the apartment 
      registration with the DHCR, listing the apartment as "exempt" from the 
      rent stabilization laws because it was a "2nd Residence."  The owner 
      then commenced a holdover proceeding against the tenant, in 
      Landlord/Tenant Court, in the County of Queens (Index No. L & T 
      45740/8).

      In August 1985 the tenant filed a complaint with the Division, alleging 
      that the owner had failed to renew his lease.  In November 1986 the 
      Division issued a conditional dismissal of the tenant's complaint, 
      stating that the tenant may reinstitute proceedings should the owner 
      fail to offer a renewal lease following a judicial determination in the 
      tenant's favor.
      During the pendency of the Housing Court determination, the owner failed 
      to register the apartment, claiming that to have registered it as 







          FK 110192 RO

      stabilized would have prejudiced his case (1985 and 1986 registrations).  
      The decision on March 31, 1986 by Judge J. Golia was that the tenant was 
      protected by the Rent Stabilization Law, and had been so protected from 
      the date of decontrol, January 23, 1974; and the tenant was to be 
      offered a renewal lease.

      The owner timely filed annual registration statements for 1987 through 
      1991.

      This proceeding was originally commenced by the filing in September, 
      1987 of a rent overcharge complaint by the tenant.

      In response to DHCR notices, the owner stated in substance that he had 
      not been advised that he must file a rent registration statement during 
      the pendency of his court case, and that his failure to register was in 
      good faith, not willful default requiring the imposition of treble 
      damages.

      Under Docket No. BI-110260-R, the Rent Administrator determined that the 
      tenant had been overcharged in the amount of $11,638.88, and directed 
      the owner to refund such overcharge to the tenant as well as to reduce 
      the rent.

      In this petition, the owner contends in substance that the Administrator 
      apparently did not consider its answer in the proceeding below, and 
      requested reversal of the determination. 

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

      The envelope indicates that the owner's answer to the Division's final 
      notice was mailed on October 22, 1991, but the answer did not reach the 
      Administrator's file prior to the issuance of the Administrator's order 
      on October 24, 1991; it was date-stamped received by the DHCR on October 
      25, 1991.

      D.H.C.R. Policy Statement 89-2 states, in pertinent part; the owner must 
      prove by a preponderance of the evidence that the overcharge was not a 
      willful act....  "The owner can submit such evidence after receiving 
      notice of a tenant's filing of an overcharge complaint prior to the 
      final order being issued."  Since this submission was mailed prior to 
      the issuance of the Administrator order but did not reach the 
      Administrator prior to issuance of the order, it may be considered on 
      appeal.

      The Commissioner finds that the evidence submitted by the owner 
      establishes a lack of willfulness.  Accordingly, the penalty of treble 
      damages will not be assessed.  Rather pursuant to Section 2526.1 of the 
      Rent Stabilization Code, interest will be assessed on all overcharges 
      occurring on or after April 1, 1984.




      The revised calculation of overcharges is as follows: overcharges of 
      $3845.54, plus interest at the rate of 9 per cent, or $697.58, plus 
      excess security of $102.26, results in a total overcharge of $4645.38.



          FK 110192 RO

      Because this determination concerns lawful rents only through October 
      31, 1991, the owner is cautioned to adjust subsequent rents to an amount 
      no greater than that determined by this order plus any lawful increases, 
      and to register any adjusted rents with this order and opinion being 
      given as the explanation for the adjustment.

      This order may, upon the expiration of the period in which the owner may 
      institute a proceeding pursuant to Article 78 of the Civil Practice Law 
      and Rules, be filed and enforced in the same manner as a judgment or not 
      in excess of twenty percent per month thereof may be offset against any 
      rent thereafter due the owner.

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

      ORDERED, that this petition for administrative review be, and the same 
      hereby is, granted in part, and, that the order of the Rent 
      Administrator be, and the same hereby is, modified in accordance with 
      this order and opinion.  The amount of the rent overcharge through 
      October 31, 1991 is $4,645.38.


      ISSUED:



                                                                    
                                      JOSEPH A. D'AGOSTA
                                      Acting Deputy Commissioner




                 
































          FK 110192 RO






    

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