FL630042RO

                        STATE OF NEW YORK
            DIVISION OF HOUSING AND COMMUNITY RENEWAL
                  OFFICE OF RENT ADMINISTRATION
                           GERTZ PLAZA
                     9-31 UNION HALL STREET
                     JAMAICA, NEW YORK 11433




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IN THE MATTER OF THE ADMINISTRATIVE     ADMINISTRATIVE REVIEW
          APPEAL OF                               DOCKET NO.:                  
          FL630042RO; 
                   
                                                  RENT ADMINISTRATOR'S
                PIERSON PROPERTY CORP.,           DOCKET NO.:
                                                  DD630092B

                                                  PREMISES:        
                                                  2300 Olinville Ave.,    
                                   PETITIONER     Bronx, New York
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            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                     IN PART AND REMANDING PROCEEDING ON APPEAL


          The above-named owner timely filed a petition for administrative 
          review of an order issued on November 6, 1991 concerning the 
          housing accommodations relating to the above-described docket 
          number wherein the Administrator ordered a rent reduction based on 
          a finding of a decrease in services.

          The issue in this appeal is whether the Administrator's order was 
          warranted.

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

          Various rent-stabilized tenants under the aegis of their tenants' 
          association commenced this proceeding on April 13, 1989 by filing 
          a complaint asserting that the owner had failed to maintain num- 
          erous services in the subject building including, but not limited 
          to, "problems with roof".

          On May 15, 1989, the Division sent the owner a copy of the com- 
          plaint and the owner filed an answer advising that some of the 
          tenants' signatures were purportedly forged, that required services 













          FL630042RO


          are being provided and maintained, that some of the disrepair had 
          been caused by the tenants, and otherwise denying the allegations 
          as set forth in the tenants' complaint.

          On November 6, 1989, the Division sent the tenants' association a 
          copy of the owner's answer and the association's president filed a 
          response on November 17, 1989 asserting that the complaint had been 
          fully discussed and debated by the membership before the tenants 
          signed; and that except for one item, numerous defective conditions 
          still remain.

          Physical inspections of the subject building were conducted on 
          December 15, 1989, February 9, 1990 and September 19, 1991 by a 
          Division staff member who confirmed that though many services were 
          maintained, defective conditions still exist.

          On December 15, 1989, the inspector wrote that the building has two 
          elevators both serving all apartment dwellers, and the west or left 
          elevator is not running; that none of the elevator floor light 
          indicators work; that though the roof has been patched in two 
          places, there is evidence of roof leaks in Apts. #21-F and #21-D, 
          both having been water-damaged; and that the center light in the 
          parking lot is not working.

          On February 9, 1990, another physical inspection of the subject 
          building was conducted by a Division staff member who reported that 
          there was evidence of rook leaks in Apt. 21-C and water damages 
          above the south window; and that there is evidence of roof leaks in 
          the top floor, the 21st floor where the ceiling west of the 
          elevators is water-stained.

          On September 19, 1991, the inspector reported that the roof is in 
          a poor condition with soft spots and blisters in various places; 
          that the 21st floor ceiling west of the elevators is water-damaged; 
          and that there is evidence of roof leaks in the kitchen and bath of 
          Apt. 21-D and east of the bedroom ceiling of Apt. 21-B.

          Based on these inspections, the Administrator determined that the 
          roof is defective and that there is evidence of water damage to the 
          ceilings of the public area on the 21st floor.  The Administrator 
          directed restoration of services and further ordered a reduction of 
          the stabilized rents retroactive to June 1, 1989 to the level of 
          rent in effect prior to the last rent guidelines increase.  

          In this petition, the owner contends in substance that the com- 
          plained of conditions had not been brought to the attention of the 
          owner or its agent both "in person" and "by phone" as asserted in 




          the tenants' complaint; that the Administrator made no reference to 
          the alleged fraud or impropriety of the tenants' signatures, as 





          FL630042RO


          raised by the owner in the proceeding below; that the rent reduc- 
          tion for all tenants is "draconian" when there was only one 
          defective condition and all other services were being maintained by 
          the owner; that the finding of a defective roof and water damage to 
          the ceilings of the public area on the 21st floor is ambiguous and 
          does not appear to be a building-wide defect; that this finding, 
          which is normal maintenance and may already have been repaired by 
          the owner, was not complained of in the tenants' complaint; and 
          that the extensive rent reduction effective June 1, 1989 is a 
          windfall to the tenants.  

          The owner cited Commissioner's orders holding that inspection 
          reports not based on the tenants' complaint are improper; that the 
          Administrator erred in failing to examine irregularities regarding 
          signatures and the owner's repair of all complained of conditions, 
          except for one item of ordinary maintenance not stated in the 
          tenants' complaint; and that the Division's inspections are 
          nebulous and questionable findings of fact to confirm the tenants' 
          allegations in the complaint because the owner may already have 
          remedied this situation which probably recurred.

          On February 24, 1993, a copy of the owner's petition was mailed to 
          the tenants who did not file an answer.

          The Commissioner is of the opinion that the owner's petition should 
          be granted in part to the extent of remanding this proceeding to 
          the Administrator for a hearing if necessary on the issue of fraud 
          and forgery of some tenants' signatures in the complaint. However, 
          the Commissioner affirms in all respects the Administrator's 
          finding of decreased services, which was properly based on an on- 
          site inspection.

          Section 2523.4 of the Rent Stabilization Code requires the Division 
          to reduce the legal regulated rent, upon application by the tenant, 
          for the period for which it is found that the owner has failed to 
          maintain required services.  Required services are defined by Sec- 
          tion 2520.6(r) to include repair and maintenance.

          A review of the evidence of record shows that the Administrator 
          based his determination on the entire record, including the results 
          of the Division's December 15, 1989, February 9, 1990 and September 
          19, 1991 inspection reports which consistently identified and 
          corroborated the tenants' claims in the complaint.  Therefore, the 
          Commissioner finds that the Administrator correctly determined that 
          the owner had failed to maintain services and properly reduced the 
          tenants' rent.



          However, the Commissioner finds that the Administrator failed to 
          process the owner's contention that some of the tenant's signatures 
          were forged.  Although the owner merely asserted the allegation of 
          fraud and forgery and the tenants did dispute this issue, there is 










          FL630042RO


          nothing in the record to establish that the Administrator investi- 
          gated this issue nor does the order address same.  Accordingly, the 
          Commissioner remands this proceeding to the Administrator for a 
          hearing if necessary on the issue of fraud and forgery of some 
          tenants' signatures.

          The claim that the order appealed from violates precedents holding 
          that the inspection reports should be based on the tenants'com- 
          plaint does not apply to this case.  In all three inspection 
          reports, the Commissioner finds confirmation of "problems with 
          roof" as set forth in the tenants' complaint.

          The assertion that this condition of normal maintenance had not 
          been brought to the attention of the owner or its agent both "in 
          person" and "by phone" does not establish error.  The record 
          discloses that the Division forwarded the tenants' complaint to the 
          owner on May 15, 1989, affording the owner notice of the conditions 
          cited in the order.  As such, the owner had thirty (30) months to 
          make repairs prior to the issuance of the order.  In addition, if 
          this condition is of normal maintenance, such item would have been 
          corrected within this time span.

          The contention that the Administrator's determination concerning 
          the roof and water damage is nebulous, questionable, and not based 
          on the tenants' complaint is without merit.  As set forth above, 
          the Commissioner finds that the inspection reports verify the 
          tenants' complaint.  The Commissioner further finds that the 
          finding of "defective roof" and "evidence of water damage to the 
          ceilings of the public area on the 21st floor" is unambiguous, 
          certain and sufficiently specific on what repairs the owner ought 
          to do.

          The further assertion that the owner may already have remedied this 
          situation which probably recurred was not substantiated in the 
          proceeding before the Administrator and therefore fails to refute 
          the inspections' findings to the contrary.  If conditions did recur 
          during the proceedings under review between the owner's receipt of 
          the tenants' complaint and the inspections, such frequency of 
          recurrence should put the owner on notice either to increase the 
          instances of or to shorten the intervals between normal mainte- 
          nance, or to find another more permanent solution.






          The claim that the water damage is merely on the 21st floor and not 
          a building-wide decreased service are without merit.  All three 
          inspections at various times indicate a defective roof, and the 
          finding of water damage on the 21st floor is merely a visible evi- 
          dence of the roof's deterioration, which affects all the tenants in 
          the building.





          FL630042RO



          The further contention that the Administrator erred in failing to 
          examine the owner's substantial repairs of the items in the 
          tenant's complaint is without merit.  The Commissioner finds that 
          after a careful review of the record, the on-site inspection re- 
          ports about a defective roof and water damage to the ceilings of 
          the 21st floor public area contradict any allegation of substan- 
          tial repairs.  In addition, the tenants disputed this contention by 
          filing a response on November 17, 1989 asserting that except for 
          one item, numerous defective conditions still remain.

          In a rent-stabilized building, as in this case, the owner has to 
          address the tenants' complaint completely and effectively in- 
          cluding, but not limited to, a defective roof and water damage.  
          Here, the owner offered no reason to disturb the Administrator's 
          order which is based on three inspections consistently finding 
          decreased services, warranting a rent reduction.

          The Administrator's order directing the rent reduction effective 
          June 1, 1989 is correct, because this is the month following the 
          owner's being served the tenants' complaint, i.e. on May 15, 1989.

          A search of the Division's records shows that the owner has not 
          filed any application to restore rent based on the restoration of 
          services.  The owner is advised to restore services and accordingly 
          file a rent restoration application based upon the restoration of 
          the services in question.


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

          ORDERED, that this petition, and the same hereby is, granted to the 
          extent of remanding this proceeding to the Administrator for a 
          hearing if necessary to address the issue of fraud and forgery of 
          some tenants' signatures in the complaint.  However, the Adminis- 










          trator's finding as to decreased services is affirmed and the rent 
          reduction ordered by the Administrator remains in effect until a 
          new order is issued pursuant to the remand.  


          ISSUED:











          FL630042RO



                                                                           
                                                          JOSEPH A. D'AGOSTA
                                                               Deputy Commissioner
    

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