FG130299RT

                                  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
          APPEALS OF                               DOCKET NO.: 
                                                  FG130299RT REOPENED       
                 VARIOUS TENANTS OF               
                 42-15 43RD AVENUE                RENT ADMINISTRATOR'S           
                                                  DOCKET NO.: 
                                  PETITIONER      EK130045B
          ----------------------------------x


            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                   AND REMANDING PROCEEDING TO RENT ADMINISTRATOR

               On July 23, 1991, various tenants of the subject building 
          filed a petition for administrative review of an order issued on 
          June 24, 1991, by a Rent Administrator concerning the building 
          known as 42-15 43rd Avenue, Sunnyside, New York wherein the 
          tenants' rent reduction application was denied and the owner 
          directed to restore services based on a finding that the building 
          is operated by a court appointed receiver.

               On June 25, 1992 the Commissioner issued an order and opinion 
          granting the petition for administrative review of the tenants and 
          modifying the Administrator's order to the effect of ordering a 
          rent reduction for rent controlled and rent stabilized tenants 
          based on the report of the DHCR inspector. 

               On June 26, 1992 the owner requested reconsideration of the 
          order and opinion described above.  The owner stated  that it had 
          obtained title to the subject building pursuant to judicial sale on 
          March 6, 1992.  The owner further stated that it was never given 
          the opportunity to participate in the administrative review process 
          despite having notified the DHCR of this change in ownership before 
          the issuance of the Commissioner's order and opinion.  The 
          Commissioner issued an order on July 14, 1992 wherein the owner's 
          request for reconsideration was granted and the proceeding was 
          ordered reopened.

               The Commissioner has again reviewed all of the evidence in the 
          record and has carefully considered that portion relevant to the 
          issues raised by the petition for review.

               On November 16, 1990 the subject tenants filed an application 













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          for rent reductions based on the owner's alleged failure to 
          maintain services alleging that an elevator in the building was 
          "chronically out of order". 

               The owner interposed an answer to the tenants' complaint  
          wherein it submitted evidence that the property was being operated 
          by a court appointed receiver.  An additional response was filed 
          wherein the owner stated that the elevators were regularly serviced 
          and that an engineer was being consulted in order to determine if 
          any rebuilding was necessary. 

               On January 25, 1991 a physical inspection of the subject 
          building was carried out by the Division of Housing and Community 
          Renewal (DHCR).  The inspector, in his report, noted that one 
          elevator was out of order.

               On January 31, 1991 the Administrator sent a notice to the 
          owner wherein it was advised of the results of the DHCR inspection 
          and afforded an opportunity to make repairs and present evidence of 
          such repairs to the Administrator.  On February 4, 1991 the owner 
          sent the Administrator a response wherein it stated that the 
          elevator in question had been repaired.  The owner attached a copy 
          of the elevator service contract to the response.  

               On February 13, 1991 the owner sent an additional response to 
          the Administrator wherein the owner stated that it had entered into 
          a contract for the replacement of the elevator.  It attached a copy 
          of said contract to the response.

               The Administrator issued the order here under review on July 
          10, 1991. While noting the results of the DHCR inspection described 
          above, the Administrator dismissed the proceeding based on the fact 
          that the evidence indicated that the subject building was owned by 
          a receiver.

               In their petition for administrative review the tenants 
          requested reversal of the Rent Administrator's order alleging that 
          there exists no legal basis for denying the tenants' application 
          for rent reductions.  The Commissioner issued an Order and Opinion 
          on June 25, 1992.  The order granted the petition and modified the 
          Administrator's order to the extent of ordering a rent reduction. 
          The Commissioner specifically found that no legal basis existed for 
          excusing a court appointed receiver from a rent reduction that is 
          otherwise warranted.  The petition was served on the owner on July 
          15, 1992.

               On November 25, 1992, after the proceeding had been reopened,  
          the owner filed an answer to the petition of the tenants.  After 
          detailing the relevant procedural history the owner makes the 
          following arguments:








          FG130299RT

                    1.   The fact and circumstances of this particular 
                         proceeding are insufficient to warrant a rent 
                         reduction since any elevator breakdown was 
                         temporary in nature and was repaired as of February 
                         4, 1991,

                    2.   If a rent reduction is still found to be warranted 
                         it must be ordered solely for the tenants who live 
                         in the right wing of the building since they are 
                         the only ones "affected" by the diminution in 
                         services,

                    3.   The receiver who collected the rents is liable to 
                         the tenants for any rent reduction ordered,

                    4.   It is the policy of the DHCR to no longer  order 
                         rent reductions for defects in elevator operation.

               After careful consideration the Commissioner is of the opinion 
          that this petition should be granted and the proceeding should be 
          remanded to the Rent Administrator.

               The Commissioner finds that there is no basis for excusing a 
          court appointed receiver from a rent reduction that is otherwise 
          warranted.

               The Rent Stabilization Code [Section 2520.6(i)] defines an 
          owner as

                   "A fee owner, lessor, sublessor, assignee, net
                    lessee or a proprietary lessee . . . or any 
                    other person or entity receiving or entitled 
                    to receive rent for the use or occupation at 
                    any housing accommodation . . . "

               Similarly, the Rent and Eviction Regulations [Section 
          2200.2(h)] define a landlord as an;

                   "owner, lessor, sublessor, assignee 
                    or other person receiving or entitled
                    to receive rent  for the use and 
                    occupancy of any housing
                    accommodation . . .", 

          a definition that would encompass a receiver.

               As an entity entitled to receive rent, a Court appointed 
          receiver is within the definition of an owner.

               Section 2523.4 of the Code provides for a rent reduction, upon 
          application by a tenant, based on a finding that the owner has 













          FG130299RT

          failed to maintain required services.  Required services are 
          defined in Section 2520.6(r) to include elevator services.  

               Section 2202.16 of the regulations authorizes a rent reduction 
          based on a finding that there has been a decrease in essential 
          services which are defined in Section 2200.3(b) to include elevator 
          service. 

               The record indicates that the owner was notified of the 
          results of the inspection finding that the elevator was inoperative 
          and responded that repairs had been made pursuant to a service 
          contract.  On remand, the Administrator should investigate, by 
          means of a hearing if necessary, when the elevator was repaired.  
          If it was before the Administrator's order was issued, on July 10, 
          1991, no rent reduction should be ordered.  If it was after the 
          July 10, 1991 issuance date, a guideline rent reduction should be 
          ordered for all stabilized tenants who joined in filing the instant 
          petition, effective December 1, 1990 and an appropriate rent 
          reduction for all rent controlled tenants in the building effective 
          August 1, 1991.

               Given the fact that the owner did not have an opportunity to 
          file a rent restoration application, if a rent reduction is found 
          to be warranted by the Administrator, the Administrator should also 
          investigate on remand when the elevator was repaired and restore 
          the rents accordingly.

               Contrary to the owner's allegation it has been and continues 
          to be the policy of the DHCR to order rent reductions for elevators 
          based on an inspection by the Division revealing an inoperative 
          elevator. The physical inspection in this case confirmed that the 
          elevator was out of order and the tenants requested a rent 
          reduction in their complaint. Accordingly, the Administrator erred 
          in dismissing the proceeding because of the receivership without 
          determining whether there has been a failure to maintain elevator 
          service.  

               THEREFORE, in accordance with the Rent Stabilization Law and 
          Code, and the Rent and Eviction Regulations for New York City,
          it is,









               ORDERED, that this petition be, and the same hereby is, 
          granted and that the proceeding be, and the same hereby is, 






          remanded to the Rent Administrator for further processing in 
          accordance with this order and opinion.


          ISSUED:

                                                                           
                                                JOSEPH A. D'AGOSTA
                                                Deputy Commissioner











    

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