GB530064RO

                                  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.:  GB530064RO
                                                  
          AERIE LEROY CORP.                       RENT
                                                  ADMINISTRATOR'S DOCKET 
                                                  NO.: FF530135OR
                                  PETITIONER            
          ----------------------------------x


            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                  IN PART AND MODIFYING RENT ADMINISTRATOR'S ORDER

               On February 10, 1992 the above named petitioner-owner filed a 
          Petition for Administrative Review against an order of the Rent 
          Administrator issued January 15, 1992. The order concerned various 
          housing accommodations located at 16 Barrow Street, New York, N.Y.  
          The Administrator denied the owner's rent restoration application. 

               The Commissioner has reviewed the record and carefully 
          considered that portion relevant to the issues raised by this 
          appeal.

               The owner commenced this proceeding on June 12, 1991 by filing 
          a rent restoration application wherein it alleged that it had 
          restored serviced for which a rent reduction order bearing Docket 
          No. BC430098B had been issued.  The Commissioner notes that the 
          Administrator had ordered rent reductions based on findings of 
          inadequate janitorial service, defective front door lock, rotted 
          stairs with splintered and cracked wood, and peeling paint and 
          plaster on hallways, ceilings and exterior window frames and 
          sashes.

               The tenants were served with copies of the application and 
          afforded an opportunity to respond. Two tenants filed responses and 
          stated, in sum, that the owner had not restored services and that 
          the application should be denied.
           
               The Administrator ordered a physical inspection of the subject 
          building.  The inspection was conducted on November 29, 1991 and 
          revealed that the owner had failed to restore any of the services 
          described above.

               The Administrator issued the order here under review on 












          GB530064RO

          January 15, 1992 and denied the application based on the 
          inspector's report.

               On appeal the owner, as represented by counsel, states that 
          inspections held in conjunction with a DHCR compliance proceeding 
          reported that the owner had restored all services; that, while some 
          conditions may have reoccurred, others could not have been reported 
          to be maintained in the compliance proceeding only to be reported 
          as not being maintained in this proceeding; and that it is 
          arbitrary to compel the owner to submit to the whim of different 
          inspectors who view the same condition in a different manner.  The 
          petition was served on the tenants on April 22, 1992.

               Two tenants filed responses which were not relevant to the 
          issue of whether or not the owner had restored the services ordered 
          restored in the rent reduction proceeding.  The owner filed a reply 
          on April 14, 1993 and essentially restated the arguments set forth 
          in the petition for administrative review.
           
               After careful review of the evidence in the record, the 
          Commissioner is of the opinion that the petition should be granted 
          in part and the order here under review should be affirmed as 
          modified.

               With regard to all cited conditions other than the stairs, the 
          Commissioner finds that the owner has not restored services and 
          that, if any repairs were attempted, they were not done in a 
          workmanlike manner because the conditions have reoccurred.  The 
          report of the DHCR inspector in this proceeding is dispositive of 
          the issue of whether or not the owner has restored services to the 
          level warranting rent restoration.  It is noted that the March 6, 
          1991 letter closing the compliance proceeding specifically advised 
          the owner that application forms had to be filed for rent 
          restoration, that a new docket number would be assigned and that 
          the rent would not be restored until an order is issued granting 
          the application.

               With regard to the stairs, however, the Commissioner is of the 
          opinion that the events in the compliance proceeding misled the 
          owner into believing that any defects in the condition of the 
          stairs had been corrected to the satisfaction of the Division's 
          inspectors.  The first inspection in the compliance proceeding was 
          on May 30, 1990 and revealed rotted, cracked and splintered wood on 
          the first through third floor landings of the public stairs.  The 
          results of this inspection were sent to the owner on June 12, 1990 
          with instructions to repair this (and other conditions) within 20 
          days.  The owner responded on September 28, 1990 stating, in 
          relevant part, that replacement of the rotted wood on the first to 
          third floors had been completed.  A following inspection on October 
          24, 1990 found that the stairs from the first to the third floor 
          landings did not appear rotted (while other conditions remained 
          defective).  A copy of that report was forwarded to the parties, 






          GB530064RO

          effectively putting the owner on notice that this condition had 
          been repaired.  Unlike some of the other conditions that were the 
          subject of the rent reduction order (such as dirty halls and a 
          defective lock) which required ongoing maintenance, the 
          Commissioner is of the opinion that rotted wooden stairs would not 
          have reappeared one year after having been replaced.  The more 
          general finding in the November 28, 1991 inspection that there were 
          various rotted wood stairs throughout the building may have been in 
          locations other than the first through third floor landings that 
          the owner was directed to correct in the compliance proceeding. 

               In any event, since the owner was erroneously put on notice 
          that the stairs had been repaired, due process requires that the 
          application for rent restoration be granted with regard to  the 
          stairs and that rent restoration of $3.00 per month be ordered for 
          rent controlled tenants effective February 1, 1992.  With regard to 
          rent stabilized tenants, the order here under review is modified to 
          delete the defective stairs as a basis for denying the rent 
          restoration application.  However, since the owner is now on notice 
          that portions of the wooden stairs are rotted, splintered and 
          cracked, the owner is directed to make the necessary repairs within 
          30 days of the issuance of this order or be subject to additional 
          fines and penalties.

               The Commissioner notes that the owner's reapplication for rent 
          restoration (Docket No GB430125OR) is pending before the DHCR.

               THEREFORE, pursuant to the Rent Stabilization Law and Code and 
          Rent and Eviction Regulations for New York City it is 

               ORDERED, that this petition be, and the same hereby is, 
          granted in part, and that the Rent Administrator's order be, and 
          the same hereby is, affirmed as modified herein.  Any rent 
          controlled tenant who owes arrears based on the Commissioner's 
          decision herein may pay off said arrears in installments of $3.00 
          per month or immediately if the apartment is vacated.

          ISSUED:



                                                                             
                                             JOSEPH A. D'AGOSTA
                                             Deputy Commissioner
                                   






    

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