Federation of Mobile Home Owners of Florida, Inc. v. Florida Manufactured Housing Ass'n, Inc.

• Decision Date: 13 November 1996
• Docket Number: Nos. 95-3525,95-3538,s. 95-3525
• Citation: 683 So.2d 586
• Parties: 21 Fla. L. Weekly D2447 FEDERATION OF MOBILE HOME OWNERS OF FLORIDA, INC. and Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes, Appellants, v. FLORIDA MANUFACTURED HOUSING ASSOCIATION, INC., Appellee.
• Court: Florida District Court of Appeals

Page 586

683 So.2d 586

21 Fla. L. Weekly D2447

FEDERATION OF MOBILE HOME OWNERS OF FLORIDA, INC. and Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes, Appellants, v. FLORIDA MANUFACTURED HOUSING ASSOCIATION, INC., Appellee.

Nos. 95-3525, 95-3538.

District Court of Appeal of Florida First District.

Nov. 13, 1996.

Peter M. Dunbar and Robert S. Cohen of Pennington & Haben, P.A., Tallahassee, for Appellant/Federation of Mobile Home Owners of Florida, Inc. Robin L. Suarez of Department of Business and Professional Regulation, Tallahassee, for Appellant/Department of Business and Professional Regulation.

W. Dexter Douglass and Michelle Anchors of Office of the Governor, Amicus Curiae.

David D. Eastman, Jack M. Skelding, Jr., and Carl R. Peterson, Jr. of Skelding, Labasky, Corry, Eastman, Hauser & Jolly, P.A., Tallahassee, for Appellee.

DAVIS, Judge.

The Federation of Mobile Home Owners of Florida, Inc., and the Florida Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums, and Mobile Homes (the Division), appeal a final administrative order determining that the proposed repeal of Rule 61B-31.001(5), Florida Administrative Code, constitutes an invalid exercise of delegated legislative authority in violation of section 120.54(4), Florida Statutes (1993), and that the Division's policy statements relating to the length of validity of a prospectus and to the elimination of any procedure for approving amendments to previously filed and approved prospectuses violate section 120.535, Florida Statutes (1993). The broad issues raised in this appeal are whether the Division's decision to repeal Rule 61B-31.001(5) is "rulemaking," and, if so, whether such repeal violates section 120.54, Florida Statutes (1993), and whether repeal of this rule amounts to the institution of a non-rule policy violative of section 120.535. Because we agree with the hearing officer's conclusion that the elimination of the procedure for approval of amendments to prospectuses violates section 120.54 by improperly vesting the Division with unbridled discretion over the manner of performance of a statutorily mandated obligation to approve prospectuses, as well as the alternative holding that the repeal of this rule was an improper method of instituting two non-rule policies in violation of section 120.535, we affirm. However, because his reasoning was based upon an erroneous interpretation of earlier decisions of this court, we reject the hearing officer's conclusion that the repeal of the rule as it relates to the length of viability of a prospectus violates section 120.54(4).

The Florida Legislature enacted Chapter 723 (formerly Chapter 83) to provide mobile home owners with security in their dealings with mobile home park owners. Stewart v. Green, 300 So.2d 889, 891 (Fla.1974); Palm Beach Mobile Homes, Inc. v. Strong, 300 So.2d 881, 886-87 (Fla.1974); Herrick v. Florida Dep't of Business Regulation, 595 So.2d 148, 157 (Fla. 1st DCA 1992). Mobile home owners and mobile home park owners are in a peculiar tenancy relationship referred to by the Florida Supreme Court as "a hybrid type of property relationship" distinct from a traditional landlord/tenant relationship. Stewart v. Green, 300 So.2d at 892; see also § 723.004, Fla.Stat. (1993). The high cost of moving a mobile home into or out of a mobile home park places the resident mobile home owner in an unequal bargaining position with the mobile home park owner from whom he rents a lot. One of the means of providing tenants with this security is the requirement that the mobile home park owner provide tenants and prospective tenants with an approved prospectus. This court in Herrick reiterated the importance of the prospectus as one of the foundations of the Legislature's efforts to protect mobile home owners. Herrick, 595 So.2d at 152.

An approved prospectus must be delivered prior to the creation of an enforceable rental agreement. § 723.011, Fla.Stat. The prospectus is a document providing full and fair disclosure of the terms and conditions of residency in the mobile home park, and sets forth regulations to which the mobile home owner will be subjected after signing a lot rental agreement. A prospectus must include

a description of the mobile home park property (Section 723.012(4)(c)), a description of the recreational and other common facilities to be used by the home owners (Section 723.012(5)), the arrangements for management of the park and maintenance and operation of the park property (Section 723.012(6)), a description of all improvements which are required to be installed by the mobile home owner (Section 723.012(7)), a description of the manner in which utility and other services will be provided to the home owners (Section 723.012(8)), an explanation of the manner in which rents and other charges will be raised, including 90 days advance notice and disclosure of any rate increase or pass-through charges, and any other fees, costs or charges to which the home owner may be subjected (Section 723.012(9)), and an explanation of the manner in which park rules or regulations will be set, changed or promulgated, including park regulations currently in effect (Section 723.012(10)).

Village Park Mobile Home Ass'n, Inc. v. Florida Dep't of Business Regulation, 506 So.2d 426, 428 (Fla. 1st DCA), review denied mem., 513 So.2d 1063 (Fla.1987). Nothing in chapter 723 defines how long the required prospectus remains valid. Nor does the statute explain how or when a prospectus may be amended.

The substance of Rule 61B-31.001(5) was originally adopted in 1985 as Rule 7D-31.01(5), and was later renumbered (as Rule 7D-31.001(5) and then Rule 61B-31.001(5)) without any substantive changes. Rule 61B-31.001(5) provides:

The Prospectus distributed to a home owner or prospective home owner shall be binding for the length of the tenancy, including any assumptions of that tenancy, and may not be changed except in the following circumstances:

(a) Amendments consented to by both the home owner and the park owner.

(b) Amendments to reflect new rules or rules that have been changed in accordance with procedures described in Chapter 723, F.S., and the prospectus.

(c) Amendments to reflect changes in the name of the owner of the park.

(d) Amendments to reflect changes in zoning.

(e) Amendments to reflect a change in the person authorized to receive notices and demands on the park owner's behalf.

(f) Amendments to reflect changes in the entity furnishing utility or other services.

(g) Amendments required by the Division.

(h) Amendments required as a result of revisions of Chapter 723, F.S.

(i) Amendments to add, delete or modify user fees for prospective home owners.

Neither Chapter 723 nor the rule defines "tenancy." The rule uses the word "tenancy" in attempting to define the term of viability of a prospectus. When the Division adopted the rule in 1985 it took the position that the prospectus was binding on the park owner and the mobile home owner until the mobile home owner no longer occupied the lot or the tenant was evicted, whichever occurred first.

After Herrick v. Florida Department of Business Regulation, 595 So.2d 148, 157 (Fla. 1st DCA 1992) was decided, the Division believed that "tenancy" had been defined to mean the term of a lot rental agreement, or at least that the case could be interpreted in that manner. Although contending that the case should not be interpreted as having restricted the meaning of "tenancy" to the term of a rental agreement, the Division was concerned that the decision of this court would have the effect of permitting Rule 61B-31.001(5) to be construed to provide that a prospectus is valid only for the period covered by a rental agreement. The Division decided to repeal Rule 61B-31.001(5) because the Division reasoned that the rule no longer accomplished an appropriate implementation of section 723.012 if interpreted in that manner. Therefore the Division published notice of the proposed repeal of Rule 61B-31.001(5) in the Florida Administrative Weekly, as required by section 120.54(1)(b), Florida Statutes (1995).

The Florida Manufactured Housing Association, Inc. (FMHA), is a Florida not-for-profit corporation organized to represent the interests of the owners of approximately 750 mobile home parks. FMHA petitioned to determine the invalidity of the proposed repeal, asserting that the proposed repeal was illegal because the Division was replacing a clearly articulated standard establishing the effective term of such prospectuses, and governing the manner and method of amending prospectuses, with non-rule policies, in violation of section 120.535. These non-rule policies are that the prospectus remains in effect for some undetermined amount of time greater than the term of any particular rental agreement and that the Division will not review and approve amendments to previously approved prospectuses. FMHA also averred that those two alleged non-rule policies are violative of section 120.56, as an invalid exercise of delegated legislative authority because they enlarge, modify, or contravene the law implemented as interpreted by the District Court of Appeal, First District, and as ratified by subsequent legislative inaction. Finally, FMHA's petition asserted that the proposed repeal itself, as distinct from the policies allegedly being substituted for the rule, is invalid rulemaking pursuant to section 120.54(4) on four grounds: first, because the Division failed to follow the rulemaking procedures in section 120.54; second, because the Division exceeded its grant of rulemaking authority in that the repeal enlarges, modifies, or contravenes the law implemented as interpreted by the District Court of Appeal, First District; third, because the remaining rules are so vague as to vest unbridled discretion in the Division, particularly with regard to the nature...