HA410056RO
                                  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    SJR 7083
          IN THE MATTER OF THE ADMINISTRATIVE :    ADMINISTRATIVE REVIEW
          APPEAL OF                                DOCKET NO.HA410056RO
                                              :    DRO DOCKET NO.FC410241R
             Associated Realties                   TENANT: Anthony Marcus

                               PETITIONER     :
          ------------------------------------X

             ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW

          On January 20, 1993  the  above-named  petitioner-owner  filed  a
          Petition for Administrative Review against  an  order  issued  on
          January 8, 1993 by the Rent Administrator, 92-31 Union Hall Street, 
          Jamaica, New York concerning the housing accommodation known as 308 
          West 97th Street, Apartment 23, New York, New  York  wherein  the
          Administrator determined that the tenant had been overcharged.

          Subsequent thereto, the petitioner-owner filed a Petition in  the
          Supreme Court pursuant to Article 78 of the Civil Practice Law and 
          Rules requesting that the "deemed denial"  of  its  Petition  for
          Administrative Review be annulled.  The proceeding was remitted to 
          the Division of Housing and Community  Renewal  (DHCR),  and  the
          owner's petition is herein decided on the merits.

          The Commissioner has examined all of the evidence of record and has 
          carefully considered that portion of the record relevant  to  the
          issues raised in the administrative appeal.

          The tenant commenced this proceeding on March 12, 1991  when  the
          tenant filed a complaint of rent overcharge.

          In response to the complaint, the owner asserted  that  all  rent
          increases had conformed to applicable rent guidelines and that the 
          tenant's rent included a rent increase based on 1/40th of the cost 
          of improving the subject apartment.  The owner submitted bills and 
          cancelled checks in support of  its  claim  for  a  $753.00  rent
          increase for individual apartment improvements.

          When a check with DHCR computerized rent records revealed that the 
          owner had failed to register the subject apartment in  1984  (the
          initial registration), 1985 and 1986,  the  owner  corrected  its
          omission by filing the 1984, 85 and 86 registrations in  November
          1992.


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          In the order here under review, the Administrator froze the rent at 
          the lawful rent in effect on April 1, 1984, due to the failure to 
          register in 1984 and 1985, permitted an increase of only  $492.46
          for approved apartment improvements and  directed  the  owner  to
          refund to the tenant an overcharge  of  $48,399.97  inclusive  of
          treble damages and excess security for overcharge collected  from
          January 1, 1991 to October 31, 1992.

          In its appeal, the owner contends that the Administrator's  order
          should be reversed as arbitrary and capricious in that not only has 
          the subject building always been timely registered but  also  two
          months before the issuance of the instant order, the owner refiled 
          the 1984, 1985 and 1986  registrations,  correcting  any  alleged
          defects.  The owner also contends that  all  rents  charged  were
          consistent with appropriate guidelines, that there is  no  actual
          overcharge and that  the  owner  has  established  a  pattern  of
          compliance with rent registration requirements as set forth in DHCR 
          Policy Statement 92-3 (which addresses the issue  of  service  of
          registration forms) and therefore, it was erroneous to find a rent 
          overcharge.  For a second contention, the owner asserts that  the
          Administrator  erred  in  disallowing  $10,424.25  of   apartment
          improvements in direct contravention of  Policy  Statement  91-1.
          Lastly, the owner contends that there is no rational basis for the 
          imposition of treble damages in that:
               
               1) The owner properly registered the subject  apartment  for
                  1984, 1985 and 1986 in November 1992;

               2) the Code does not provide for the  imposition  of  treble
                  damages where an owner fails to register.  The penalty is 
                  clearly stated in Code Section 2528.4 entitled "Penalty for 
                  failure to Register" whereas the treble damage penalty is 
                  cited only in Code Section 2526.1.   As  a  principle  of
                  statute construction, it has been held that where there is 
                  a general provision and a specific provision in the  same
                  statute, the general  provision  does  not  overrule  the
                  particular and applies only when the  specific  provision
                  is inapplicable.

          In response, the tenant contends that the Administrator's order is 
          correct and is supported by DHCR records  which  show  that  rent
          registrations were not properly filed as well as the fact that the 
          rents charged are based upon false claims: 1) the alleged belated 
          filing of the registrations in  November  1992  can  affect  only
          subsequent rents and not any prior rents.  Further, there  is  no
          proof that the registrations were served on the  tenant;  2)  the
          increase based upon alleged improvements must be disregarded; the 
          owner lied in stating that the last registered rent was $1500.00; 








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          the alleged improvements were not made; the owner improperly lumped 
          together various repairs and alleged improvements in a number of 
          apartments and divided the total amount spent by  the  number  of
          apartments to assign a cost for  the  subject  apartment  without
          specifying the particular work done in each apartment and without 
          itemizing the cost.  Finally, the tenant contends that in view of 
          the late registrations and the lack of proof of improvements, the 
          proceeding should be remanded in determine the legal rent.  

          The owner, in reply, states that all the  registration  forms  at
          issue were served on the tenant herein, in January 1993.  The owner 
          reiterates that treble damages are inappropriate as there  is  no
          evidence of willfulness on the part  of  the  owner  and  further
          asserts that the amounts disallowed were spent for items that were 
          necessary for the installation  of  individual  improvements  and
          should have been permitted pursuant to Policy Statement 91-1. Along 
          with its reply, the owner  submitted  proof  of  service  of  the
          registration forms on the tenant herein in January 1993.

          After careful consideration, the Commissioner is of  the  opinion
          that this petition should be denied.  

          Registration of housing accommodations is governed by part 2528 of 
          the Rent Stabilization Code.  Pursuant to Code Section 2528.1, an 
          owner must register each housing accommodation subject to the Rent 
          Stabilization Law on April 1, 1984 within 90 days after such date. 
          Code  Sections   2528.2   and   2528.3   enunciate   registration
          requirements.  Despite the owner's claim that it timely  complied
          with registration requirements, it has not submitted documentation 
          to prove that it timely and properly complied with the registration 
          requirements of the Code. Late registration filing, as is the case 
          here, does not relieve the penalty imposed by Code Section 2528.4 
          but results only in the prospective elimination of the penalty. It 
          is noted that the overcharge determination herein only went up to 
          October 31, 1992- before the November 1992 owner's filing of  the
          1984 and 1985 registrations.

          With respect to the application of the treble damage penalty to the 
          failure to register, the Commissioner  notes  that  Code  Section
          2528.4 establishes the overcharge which is then penalized by Code 
          Section 2526.1.  The two Code provisions complement each other.  

          Furthermore, a finding of willfulness is warranted where there is 
          evidence of a patent fabrication in the record.  The  rent  rider
          attached to the tenant's  initial  lease  states  that  the  1990
          registered rent was $1500.00.  The lease rent in April  1990  was
          $532.47.  The owner has offered no explanation for the discrepancy. 




          Additionally, a portion of the overcharge was due to the  owner's












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          charging a rent increase for items that clearly constituted repairs 
          and maintenance for which no rent increase was warranted.  

          Section 2522.4(a) permits an owner to increase the rent by 1/40th 
          the cost of individual apartment improvements.  In the order here 
          at issue, the Administrator approved a rent increase of  $492.46,
          1/40th of $19,698.20, determined by the Administrator as qualifying 
          for a rent increase.  Costs of $10,424.75 for painting, plastering 
          and miscellaneous carpentry work was correctly disallowed as having 
          been spent on ordinary maintenance and repair, not qualifying for 
          an individual apartment improvements rent increase.

          Policy Statement 91-1, upon which the owner relies in its  appeal
          for  an  additional  rent  increase,  concerns  demolition  costs
          necessary  in  effecting   qualified   improvements.    Painting,
          plastering and miscellaneous carpentry do  not  qualify  as  such
          demolition costs and the owner may not take a rent  increase  for
          their cost on that basis.

          Policy Statement 92-3, upon which the owner also  relies  in  its
          appeal, does not support a finding that the  owner  substantially
          complied with all registration requirements during the time  that
          this proceeding was pending prior to November 1992. 

          Since the tenant did not file his own  appeal,  the  Commissioner
          finds it  inappropriate  to  consider  the  tenant's  contentions
          regarding individual apartment improvements.

          However as to the tenant's question as to what the current lawful 
          rent should be, the parties are advised that  since  the  subject
          apartment was properly registered for all required years with DHCR 
          and service of registrations effectuated on the tenant herein  by
          January 1993, the legal regulated rent as of February 1993 would be 
          $1118.53 plus any lawful increase including renewal lease increases 
          to which the owner is entitled.

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




          The Commissioner has determined in this Order and Opinion that the 
          owner collected overcharges of $48,399.97.  This Order may,  upon
          expiration of the period for seeking review  of  this  Order  and
          Opinion pursuant to Article Seventy-eight of the Civil Practice Law 






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          and Rules, be filed and enforced as a judgment or not in excess of 
          twenty percent per month of the overcharge may be offset  against
          any rent thereafter due the owner.  Where the tenant credits  the
          overcharge, the tenant may add to the overcharge,  or  where  the
          tenant files this Order as a judgment, the County Clerk may add to 
          the overcharge, interest at the rate payable on a judgment pursuant 
          to Section 5004 of the Civil Practice  law  and  Rules  from  the
          issuance date of the Rent Administrator's Order to  the  issuance
          date of the Commissioner's Order.

          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  denied,  and,  that  the  order  of  the   Rent
          Administrator be, and the same hereby is, affirmed.



          ISSUED:




           
                                                       JOSEPH A. D'AGOSTA
                                                       Deputy Commissioner
               






    

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