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Legal Battles Heat Up Over Mobile Home Park Rent Control

BB&K In The News

BB&K Attorney James Gilpin Talks About City Victory, Legal Issues

JANUARY 25, 2010
The Daily Journal

Long considered bastions of affordable housing in California, mobile home parks' low monthly space rents are big draws for seniors and others on fixed incomes. To keep those fees down, dozens of cities and counties across the state drafted rent control ordinances in the past few decades as housing became more scarce and property values shot up.
 
Now trailer parks are increasingly duking it out in court with local governments to try to wrest back power over rents, and legal observers say recent judicial decisions could impact how municipalities approach space fee regulations.

One of the most significant cases, observers said, was a 9th U.S. Circuit Court of Appeals three-judge panel's ruling in September holding that a local ordinance - which restricts yearly mobile home space lease hikes to 75 percent of increases in the local Consumer Price Index - too strongly favored tenants and amounted to an unconstitutional Fifth Amendment regulatory taking.
 
The judges held the city of Goleta in Santa Barbara County owed a park damages because of flaws in the ordinance, and sent the case back to the trial court to determine how much the city owes the owners. That hearing is on hold while the appellate court weighs Goleta's request for an en banc hearing in the case. Guggenheim v. City of Goleta, 2009 DJDAR 14205.
 
The decision, the first such ruling by a federal appellate court, is expected to crank up arguments and appeals in several other pending cases involving local trailer park fee restrictions statewide. It's also expected to embolden other park owners to file similar suits, attorneys said.

. . .

Other rulings have gone in favor of cities.

Santee, in San Diego County, has scored several wins in suits fighting its mobile home rent control ordinance, passed in 1998. Two years ago, San Diego County Superior Court Judge Kevin Enright ruled that the owner of the Meadowbrook Mobilehome Park was not economically harmed by the city's law. MHC Financing Limited Partnership Two v. City of Santee, GIC777094 (San Diego Super. Ct., filed 2008).

James B. Gilpin
, a partner at Best Best & Krieger in San Diego who represents Santee in the litigation, said the issue of mobile home park rent control is far from clear-cut legally.

But he said cases such as Guggenheim and MHC Financing Ltd. v. City of San Rafael could make cities take a closer look at their ordinances.

"When and if the decisions become final and precedential, I think you will see some adjustments," Gilpin said.

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