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

      APPEAL OF                              DOCKET NO. GF110129RO

                                          :  DISTRICT RENT OFFICE
           John Monahogios,                  DOCKET NO. ZAA100944R
                                             TENANT: Gloria Velez             
                               PETITIONER : 

                                     IN PART

      On May 30, 1992, the above-named petitioner-owner filed a Petition for 
      Administrative Review against an order issued on May 7, 1992, by the 
      Rent Administrator, 92-31 Union Hall Street, New York, concerning the 
      housing accommodations known as 42-72 80th Street, Queens, New York     
      Apartment No. 4K, 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 

      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.  

      This proceeding was originally commenced by the filing in January, 1986  
      of a rent overcharge complaint by the tenant who stated in substance 
      that she took occupancy in February 1981; that no copy of the initial 
      apartment registration (hereafter RR1) was served on her and that her 
      rent is too high.

      In answer to the complaint, the owner stated in substance that the 
      tenant's rent included electricity and a major capital improvement 
      increase issued in December 1989 under order ZBG110486OM; that the 
      tenant vacated the subject apartment in March, 1992 and that her mother 
      assumed the lease pursuant to a court stipulation.  The owner submitted 
      leases in effect from March 15, 1980.
      In Order Number ZAA100944R, the Rent Administrator established the legal 
      regulated rent as $471.55 effective February 1, 1984, determined that 
      the tenant had been overcharged and directed a refund to the tenant of 


      $21,879.68 including treble damages on that portion of the overcharge 
      collected on and after April 1, 1984.

      In addition, the rent was frozen at the rent in effect on April 1, 1984 
      due to the owner's failure to submit proof that the RR1 was served on 
      the tenant and because a service reduction order (ZAA100709S) was still 
      in effect and no order restoring the rent had been issued.

      In this petition, the owner alleges in substance that the Rent 
      Administrator failed to consider that electricity was included in the 
      rent when applying Rent Guideline Board Order 13 and did not include the 
      additional 4% increase for electricity in calculating the rent; that the 
      rent was incorrectly frozen because the RR1 had been given to the tenant 
      in 1984 in the owner's office and the rent had been restored after the 
      service reduction order, as shown by a letter dated November 7, 1987 
      from the DHCR Compliance Bureau indicating that the tenant had withdrawn 
      her service complaint; that an MCI order (BG110486OM) granting an 
      increase was not reflected in the calculation of the legal regulated 
      rent and that an increase for a new sink should be added to the rent in 
      1989 because the owner had replaced the sink after the tenant had 
      damaged the old one.

      The owner submitted copies of the MCI order; the November 7, 1987 letter 
      from the Compliance Bureau, the RR1 form for the subject apartment and 
      a bill dated March 10, 1989 for a new sink.

      In answer to the owner's petition, the tenant stated in substance that 
      the petition should be denied and the Rent Administrator's order 
      affirmed because the owner had succeeded in evicting both the 
      complainant and her mother who had taken over the lease in March 1992.

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

      An examination of the record in this case discloses that the Rent 
      Administrator had incorrectly calculated the rent for the subject 
      apartment by not applying the increase for electrical inclusion although 
      electricity was included in the rent; that an order granting an increase 
      for major capital improvements had been granted under ZBG110486OM but 
      not included in the Rent Administrator's calculation of the legal 
      regulated rent; that the owner had been requested below to submit proof 
      that a copy of the RR1 was served on the tenant, however, no proof of 
      service was provided either below or on appeal; that the owner had been 
      advised in both the November 7, 1987 letter from the Compliance Bureau 
      and the Commissioner's prior order issued August 1, 1988 which denied 
      the owner's petition (ARL11729Q) against the service reduction order 
      (ZAA110709S) to file a rent restoration application to have the rent 
      restored, but that the owner first filed such an application in July 
      1992 after the issuance of the order appealed herein; that the owner 
      failed to submit a copy of the tenant's consent for an increase for the 
      new sink installed in 1989 either below or on appeal and that moreover 
      such increase was never collected by the owner.


      Sections 2528.2 and 2528.3 of the Rent Stabilization Code outline the 
      owner's obligations under the Omnibus Housing Act to register subject 
      housing accommodations with DHCR.

      Full compliance with these registration requirements involves both the 
      filing of an initial registration with DHCR and the service of such 
      initial registration on the tenant in occupancy on April 1, 1984 or on 
      the date the apartment first becomes subject to the registration 

      Section 2528.4(a) of the Code provides, in pertinent part, that the 
      penalty for failure to completely register an apartment will be that the 
      owner will be barred from collecting any rent in excess of the legal 
      regulated rent in effect on the date the housing accommodation became 
      subject to the registration requirements and that the late completion of 
      the registration shall result in the elimination prospectively of such 

      Section 2523.4 of the Code provides for a reduction in rent to the level 
      in effect prior to the most recent guideline adjustment where the owner 
      fails to maintains services; that such a reduction order shall bar the 
      owner from the collection of further increases in rent until such 
      services are restored.

      In the instant case, the Rent Administrator correctly froze the 
      collectible rent based on the owner's failure to prove service of the 
      RR1 on the tenant and to file for an order restoring the rent although 
      the owner was given an opportunity below to provide substantiation of 
      its compliance with both the registration and maintenance of service 

      The Commissioner rejects as without merit the owner's contention that 
      the rent had been restored pursuant to the letter dated November 7, 1987 
      from the DHCR Compliance Bureau because the letter in question never 
      stated that the rent was restored but advised the owner to file enclosed 
      RTP-19 forms to have the rent restored.

      The Commissioner does agree, however, that the owner is correct that the 
      electrical inclusion allowance and MCI increase were incorrectly omitted 
      in the calculation of the legal regulated rent and although not 
      collectible until the owner complies with the registration requirements 
      and a rent restoration order is issued, should have been considered by 
      the Rent Administrator in calculating the legal regulated rents.

      Taking the above factors into account, the Commissioner has recalculated 
      the lawful stabilization rents and amount of rent overcharge for the 
      subject apartment, including treble damages, on the overcharge occurring 
      on and after April 1, 1984 to include the electrical inclusion of 4% 
      under RGBO #13, the electrical inclusion of - 1% under RGBO #15 and the 
      MCI increase to the legal regulated rent granted pursuant to order 
      ZBG110486OM issued November 3, 1989.


      The lawful stabilization rents and amount of rent overcharge are set 
      forth on the amended rent calculation chart attached hereto and made a 
      part hereof.

      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 determination made in 
      the order.   The owner is further directed to adjust subsequent rents to 
      an amount no greater than that determined by this order plus any lawful 

      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.

      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, 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 lawful stabilization rents and the amount 
      of the rent overcharge are established on the attached chart which is 
      fully made a part of this order.  The amount of the rent overcharge 
      through March 31, 1992 is $19,408.86.

      A copy of this order is being served on the current tenant of the 
      subject apartment.


                                      JOSEPH A. D'AGOSTA
                                      Deputy Commissioner

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