FB110100RO

                                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. FB110100RO

                                          :  DISTRICT RENT OFFICE
           Angelo Casabianca,                DOCKET NO. AA100952R
                                             
                                             TENANT: Darryl Pellegrini        
                   
                            PETITIONER    : 
      ------------------------------------X                             

           ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
                                         

      On February 27, 1991, the above-named petitioner-owner filed a Petition 
      for Administrative Review against an order issued on February 4, 1991, 
      by the Rent Administrator, 92-31 Union Hall Street, Jamaica, New York, 
      concerning the housing accommodations known as 24-15 41st Street, 
      Astoria, New York, Apartment No. 1F, wherein the Administrator 
      determined that the owner had overcharged the tenant.

      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.  

      The tenant commenced this proceeding on January 29, 1986 by filing a 
      complaint of rent overcharge in which he stated that he had not been 
      served with a copy of the apartment registration form.

      In response to the tenant's complaint, the owner stated that the rent 
      being charged reflected the rent of the previous tenant plus appropriate 
      guidelines increases and improvements made to the subject apartment 
      while it was vacant at a cost of $5000.00.

      Subsequently, the owner was requested to submit proof of service of the 
      April 1, 1984 Apartment Registration (RR-1 Form) on the tenant of record 
      on that date.  The owner was notified that if he were unable to submit 
      such proof, he was required to submit a complete rental history from 
      April 1, 1980.  Additionally, the owner was requested to submit bills 
      and cancelled checks for the claimed improvements.



      In response, the owner asserted that the prior tenant had resided in the 
      subject apartment for eight years but that, at the tenant's request, 












          FB110100RO

      there had not been a written lease.  The owner submitted invoices for 
      various kitchen improvements totalling $3,713.19.

      The tenant asserted that the owner was not in compliance with the law in 
      that he was not providing all required services and that, as a result of 
      the overcharge complaint, the owner had begun harassing the tenant.

      In the order here under review, based upon the owner's failure to submit 
      either proof of service of the RR-1 or a complete rental history, the 
      Administrator set the lawful stabilization rent at $396.48 by use of 
      approved default procedures and froze the rent until the subject 
      apartment was properly registered.  The owner was directed to refund an 
      overcharge of $8,345.40 inclusive of treble damages and excess security 
      through October 31, 1988 when the tenant vacated the subject apartment.

      In his appeal, the owner states that the RR-1 was served on the 
      complainant on August 2, 1988 and contends that the Administrator's 
      order should be modified to reflect the following: 

           1.   Improvements made to the kitchen and bathroom at a cost of 
                more than $2400.00; 

           2.   A Major Capital Improvement (MCI) rent increase of 5.13% 
                effective April 1, 1987 and MCI temporary increase of 4.70 
                percent effective from April 1, 1987 to March 31, 1988; 

           3.   There were two co-tenants and therefore the refund should be 
                divided between the two.

      Finally, the owner contends that any overcharge which may have been 
      collected was not willful and that treble damages should not be imposed.

      The tenant contends that the appeal should be denied:

           1.   The overcharge was willful.

           2.   The owner did not make the claimed improvements; service 
                problems in the kitchen and bathroom indicate that neither 
                room was new at the time he took occupancy; the bills 
                submitted by the owner could be fabrications; members of the 
                owner's family are in the construction business; the prices 
                seem highly inflated;

           3.   His roommate lived in the subject apartment for only one year 
                and returned to the Midwest due to harassment by the owner.




      The tenant requests that the refund be recalculated to correct an error 
      in the computation of the refund which multiplied the overcharge 
      collected by ten (10) months instead of twenty-two (22) months for the 






          FB110100RO

      period January 1, 1987 - October 31, 1988.

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

      Section 2522.4(a) of the Rent Stabilization Code provides, in pertinent 
      part, that where there has been an installation of new equipment or 
      improvements in a particular dwelling unit, the monthly stabilization 
      rent shall be increased by 1/40th of the total cost of such equipment or 
      improvements upon written consent of the tenant.  Consent of the tenant 
      is not required for equipment or improvements installed when the 
      dwelling unit is vacant.  In the event of a tenant challenge to the 
      rent, an owner is required to submit documentary evidence in the form of 
      invoices which provide an itemized breakdown of the improvements and 
      specify the apartment and cost as well as cancelled checks or other 
      evidence of payment.

      Review of the record reveals that the owner made inconsistent statements 
      regarding the total cost of the alleged improvements; the stated amounts 
      ranged from $2000.00 to $5000.00.  The invoices submitted by the owner 
      fail to meet criteria established by the DHCR, i.e. the specific 
      apartment is not stated.  Two are stamped paid (these two also specify 
      the apartment) but both are invoices for the same item, purchased on two 
      different dates, January 20, 1983 and September 30, 1984, at two 
      different prices.  No cancelled checks were submitted; the owner stated 
      that he paid cash.

      In view of the tenant's denial that improvements were made and the 
      failure of the owner's documentation, the Commissioner finds that the 
      Administrator correctly excluded a rent increase for improvements.

      The Commissioner notes that the owner herein was granted a rent increase 
      for a Major Capital Improvement (MCI) effective April 1, 1987.  However, 
      having failed to prove that the initial registration was properly 
      effected, the owner is barred by Section 2528.4 of the Rent 
      Stabilization Code from applying for or collecting any rent in excess of 
      the legal regulated rent in effect on the date the housing accommodation 
      became subject to the registration rquirements.  The late filing of a 
      registration shall result in the elimination, prospectively of such 
      penalty.

      Although the owner submitted a copy of the 1984 Apartment Registration 
      and proof of service of same in August 1988 with his appeal, this 
      evidence was not submitted for consideration by the Administrator before 
      the issuance of its order and cannot be considered de novo in this 
      appeal.  However such evidence can be used to establish that the 1984 
      rent was properly registered as to future tenants of the subject 
      apartment.  (The tenant herein vacated in October 1988).

      With regard to the issue of treble damages, Section 2526.1 of the Rent 
      Stabilization Code provides, in pertinent part, for the assessment of 
      treble damages in all cases of willful overcharge.  All overcharges are 
      presumed by statute to be willful unless the owner proves by a 












          FB110100RO

      preponderance of the evidence that the overcharge was not willful.  
      Because the owner has not satisfied his burden, the Commissioner 
      sustains the finding of willfulness and the consequent imposition of 
      treble damages.

      The evidence of record indicates that the co-complainant (Joanne Riza) 
      was a signatory to only one lease, commencing January 1, 1985 and 
      terminating December 31, 1985, and resided in the subject apartment 
      since November 1, 1984.  Accordingly, she is entitled to a potion of the 
      refund, one-half of the amount due for the fourteen month period which 
      covers her actual tenancy or $1123.92.   The tenant (Darryl Pellegrini) 
      is entitled to the remaining refund due.

      Since the tenant did not file his own appeal, it would be inappropriate 
      to consider his request with respect to the overcharges ordered to be 
      refunded. 

      The owner is directed to tender to the tenant herein a check for the 
      full amount of the overcharge and penalties, $8,345.40, as determined by 
      the Administrator upon presentation by the tenant to the owner of a 
      written instrument in proper form duly executed by the other tenant 
      releasing the owner from any further liability for such refund.

      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 
      increases.

      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, 
      the order may be filed and enforced in the same manner as a judgment.
      A copy of this order is being sent to the current occupant of the 
      subject apartment.

      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, that the order of the Rent Administrator be, and 
      the same hereby is, affirmed as modified herein.
       

      ISSUED:








          FB110100RO


                                                                    
                                      JOSEPH A. D'AGOSTA
                                      Deputy Commissioner






    

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