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

      APPEAL OF                              DOCKET NO. GC410608RT/

           Dennis Meyer, tenant           :  DRO DOCKET NO. CL510368R
           Fred Leist, owner   

                              PETITIONERS : 


      On February 27, 1992, the above-named petitioner-owner filed a Petition 
      for Administrative Review against an order issued on January 31, 1992, 
      by a Rent Administrator concerning the housing accommodations known as  
      612 West 144th Street, New York, New York, Apartment No. D9, wherein the 
      Rent Administrator determined that the owner had overcharged the tenant.

      On March 2, 1992, the above-named petitioner-tenant filed a petition 
      against the same order.

      The Administrative Appeal is being determined pursuant to the provisions 
      of Section 2522.4 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 appeals.  

      The tenant originally commenced this proceeding by filing a complaint of 
      rent overcharge on December 20, 1988.  The tenant had assumed occupancy 
      of the apartment pursuant to a one year vacancy lease commencing on 
      October 27, 1987 and terminating on October 26, 1988 at a rent of 
      $540.03 per month.  The complaint also charged that the subject 
      apartment and building were not registered with the DHCR and that the 
      owner had given the tenant a false apartment registration for 1988, 
      since it had a different identification number than the one in DHCR 

      The owner was served with a copy of the complaint and was directed to 
      submit a complete rental history.  The owner was advised that if it 
      claimed a rent increase for the installation of new equipment, it was 
      required to submit invoice(s) showing the cost and date of installation.

      In an order issued on January 31, 1992 under docket number CL510368R, 
      the Administrator determined that the tenant had been overcharged in the 
      amount of $9,394.52, including treble damages and excess security.  No 


      guidelines increase or vacancy allowance was granted for the tenant 
      immediately prior to the complainant because the tenancy lasted for less 
      than three months.  The Administrator also approved the owner's claim 
      for new equipment which was installed prior to the complainant's 
      occupancy totalling $8,384.03.

      In its petition, the owner contends, firstly, that the Administrator 
      erred by failing to grant the guidelines and vacancy allowance increases 
      for the prior tenant because the prior tenant's and the complainant's 
      leases were executed during successive guidelines periods, and that the 
      courts have found this sufficient to grant the increases, 
      notwithstanding the length of time of the prior lease; secondly, that 
      the Rent Calculation chart omitted part of an MCI increase; and finally, 
      that treble damages should not have been imposed because, in the first 
      place, the overcharges due to the guidelines and vacancy allowance - 
      which the owner does not concede were improper - were in the nature of 
      "piggybacking" overcharges (second increases during the same guidelines 
      period), and such overcharges are exempted from treble damages in Policy 
      Statement 89-2 and, secondly, because the owner was prevented from 
      voluntarily adjusting the rent prior to the issuance of the order-and 
      thereby avoid treble damages - because the DHCR did not inform him of 
      the lawful rent in time for the owner to benefit from making such an 

      The tenant's answer states that the denial of the vacancy and guidelines 
      allowances was consistent with DHCR and court decisions involving 
      extremely short term tenancies.  The tenant also contends that 
      overcharges were not an "honest mistake" because the owner knew the 
      guidelines well enough to calculate everything it was entitled to to the 
      penny, but still managed to collect increases that were illegal, such as 
      for the two-month tenancy.  The tenant also includes DHCR order 
      ZCL510196RV, which found that the owner improperly failed to provide the 
      tenant with a lease rider when he took occupancy, and contends that this 
      is further proof of the owner's "total disregard" for Rent Stabilization 

      In his own petition, the tenant challenges the Administrator's grant of 
      the rent increase for new equipment, stating that the claimed 
      installations are false and calling for an inspection of the apartment.  
      The tenant states that the owner's method was also shown in the 
      apartment that was the subject of order number DK410171R, which also 
      dealt with a false equipment claim.  Finally, the tenant contends that 
      DHCR records show that the apartment was not registered until 1988, but 
      that the order ignores this.

      In its answer to the tenant's petition, the owner states that the owner 
      had established the cost of improvements to the apartment, in accordance 
      with DHCR's Policy Statement 90-10.  The claimed sum of $8,384.03 is 
      fully documented with invoices and cancelled checks.  The owner 
      completely denies the allegations that the improvements were never 
      actually made and notes that the tenant fails to specify any 
      particularly improvement it claims is false but only makes a "bald, 
      conclusory claim which is simply wrong."

      Finally, the owner disputes the contention that the apartment was not 
      registered until December, 1988, saying that the owner had already 
      submitted copies of the initial and annual registrations for the 
      apartment to the DHCR, along with proof of service upon the tenant for 


      each.  The owner also notes that the DHCR had ruled in another order, 
      under docket number DF530029RP, which had granted the owner an MCI 
      increase, that the building was registered in 1984.

      The Commissioner is of the considered opinion that this proceeding be 
      remanded for further investigation and that a new determination be made.

      An examination of the record fails to disclose sufficient evidence to 
      either sustain or refute the Administrator's determination to grant the 
      entire amount claimed by the owner for new equipment that was allegedly 
      installed prior to the complainant's occupancy of the apartment on 
      October 27, 1987.  The record contains a single page barely legible 
      invoice on which the letterhead reads "Paul Perez, Painter and 
      Contracting" as well as a copy of both sides of a cancelled check to Mr. 
      Ruiz in the amount of $8,057.60.  The invoice lists various improvements 
      to the kitchen and bathroom in a single paragraph, but there is no 
      breakdown of costs for each item, and most of the items themselves are 
      indecipherable.  The Administrator later requested an itemized breakdown 
      of the cost of the equipment in a notice to the owner, dated September 
      30, 1991.  On October 16, 1991, the Administrator wrote a progress note 
      in the file which stated that the owner's answer containing the itemized 
      breakdown of costs had been received.  However, no such submission from 
      the owner is to be found anywhere in the file.

      It is apparent, however, that the issues raised in the tenant's 
      petition, and which were addressed by the tenant below in repeated 
      submissions to the Administrator, are not likely to be satisfied merely 
      by finding the answer from October 16, 1991.  The record contains a July 
      11, 1990 letter from the tenant which expresses considerable doubt as to 
      the bathroom and kitchen renovations.  It claims, for instance, that the 
      kitchen cabinet/countertop and stainless steel sink installation 
      probably cost no more than $169.99, as based on a recent advertisement 
      for a "better quality set-up," that the stove was a used one and was 
      later replaced by a new one, at no charge to the tenant and that the 
      refrigerator also did not work properly, but was later replaced by a 
      used one.  As for the bathroom, the only new item was "a painted 
      pressed-wood cabinet-vanity" for which the tenant cites a retail price 
      of $49.95 to $59.95.  The tenant included with the letter the vacancy 
      lease rider explaining how the vacancy rent was increased from the prior 
      tenant's rent.  This form is left blank in all spaces reserved for the 
      calculations except the last, listed as "other" in which the owner put 
      in "kitchen and bathroom modernization," next to which the vacancy rent 
      of $540.03 was listed.  The tenant also states that the owner only gave 
      him the lease rider after being served with the tenant's overcharge 

      None of these items is sufficient to cast doubt on the claim by itself, 
      but taken in totality, they render it impossible to accept the claim 
      solely on the basis of documentation.  And certainly, with the discovery 
      that an important document that was relied on by the Administrator is 
      missing from the record, it becomes clear that the record must be re- 
      opened to receive additional evidence. 
      An examination of the record reveals that the Administrator properly 
      calculated the MCI increases granted in order DF530029RP, as fully 
      documented in the rent calculation chart.  Contrary to the owner's 
      claim, the $11.95 per moth MCI increase was included on page 4 of the 
      calculation chart, such increase being the third and final part of the 
      permanent MCI increase of $40.12 per month ($14.29, effective 9/1/89, 


      $14.29, effective 9/1/90 and $11.95, effective 9/1/91).  It is noted 
      that the administrative order granting the MCI has been appealed, but no 
      opinion has been issued as of yet.  Therefore, the calculation of the 
      MCI rent increase included in the order, herein affirmed by the 
      Commissioner, remains subject to the outcome of that appeal.

      The Commissioner notes that it is a long established Division policy 
      that an owner is not entitled to calculate a subsequent tenant's rent 
      based on the rent charged under a prior tenant's lease if that prior 
      tenant had vacated within three months of the commencement of said lease 
      term.  (Accord: AJ410604RO).  Therefore, the Administrator correctly 
      omitted the guidelines increase and vacancy allowance for the tenancy 
      commencing on August 30, 1987 when calculating the vacancy lease rent of 
      the complainant because the tenancy was terminated only two months 

      The Commissioner denies the tenant's claim that the owner did not 
      register the subject apartment and building until December 1988, since 
      DHCR records confirm that all registrations have been filed.

      Finally, in conjunction with the redetermination on the owner's claim 
      for the new equipment, the Administrator shall make a new finding on the 
      issue of treble damages, basing its determination on whether the owner 
      has established by a preponderance of the evidence that any overcharge 
      was not willful.

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

      ORDERED, that this petition be and the same hereby is granted to the 
      extent of remanding this proceeding to the District Rent Administrator 
      for further processing in accordance with this order and opinion.  The 
      automatic stay of so much of the District Rent Administrator's order as 
      directed a refund is hereby continued until a new order is issued upon 
      remand.  However, the Administrator's determination as to the rent is 
      not stayed and shall remain in effect, except for any adjustments 
      pursuant to lease renewals, until the Administrator issues a new Order 
      upon remand.


                                      JOSEPH A. D'AGOSTA
                                      Deputy Commissioner

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