Rancho Santa Paula Mobilehome Park, Ltd. v. Evans, B075289

• Decision Date: 15 July 1994
• Docket Number: No. B075289,B075289
• Citation: 32 Cal.Rptr.2d 464,26 Cal.App.4th 1139
• Court: California Court of Appeals Court of Appeals
• Parties: RANCHO SANTA PAULA MOBILEHOME PARK, LTD., Plaintiff and Respondent, v. Barbara J. EVANS and Delores Erb, Defendants and Appellants. Civ.

Page 464

32 Cal.Rptr.2d 464

26 Cal.App.4th 1139

RANCHO SANTA PAULA MOBILEHOME PARK, LTD., Plaintiff and Respondent, v. Barbara J. EVANS and Delores Erb, Defendants and Appellants.

Civ. No. B075289.

Court of Appeal, Second District, Division 6, California.

July 15, 1994.

[26 Cal.App.4th 1141] Richard A. Weinstock, Ventura, for appellant Evans.

Channel Counties Legal Services Ass'n and Andrew Koenig, Robert K. Miller, M. Carmen Ramirez, Grant R. Specht and Barbara Macri-Ortiz, Oxnard, for appellant Erb.

Crosby & Stanton and Bruce E. Stanton, Saratoga, as amici curiae, on behalf of appellants.

Swanson and Dowdall and Jim P. Mahacek, Swanson and Gieser, Santa Ana, for respondent.

Biddle & Hamilton and W. Craig Biddle, Sacramento, as amici curiae, on behalf of respondent.

SCHOENBERG, Associate Justice. ^*

Can a mobilehome park owner prohibit a mobilehome owner from subleasing his mobilehome? We hold that the parties can validly agree to the restriction, but that a rule prohibiting all subleasing imposed by the park owner without the homeowner's consent is not a reasonable park rule and is therefore unenforceable as to the homeowner and her tenant.

FACTS

Appellant, Barbara Evans, is the owner of a mobilehome situated in Rancho Santa Paula Mobilehome Park. In 1987, Evans and her now deceased husband purchased the mobilehome and rented space in respondent park. Evans has never resided in the mobilehome. Evans's stepdaughter resided in the mobilehome until February 1992, when she was forced by illness to vacate. Since March 1992, Evans has listed the mobilehome for sale but has not found a buyer. From March through June 1992, the mobilehome remained unoccupied. On June 28, 1992, Evans leased her mobilehome to appellant Dolores Erb. Erb remains a tenant in the mobilehome subject to vacating should Evans sell the mobilehome.

On July 27, 1992, ¹ respondent distributed amended park rules to the homeowners.

                The amended rules contained the following provision:  "1.  RESTRICTIONS ON USE:  [p] ....  [p] C. No person may regularly occupy or reside in a mobilehome unless at least one person is at least fifty-five (55) years of age and that person will regularly reside in and occupy the mobilehome on a full-time basis at all times in the future.  That person must also appear on the registration as a registered owner of the home.   All other persons who will regularly reside in and occupy the mobilehome must be at least eighteen (18) years of age or older."  (Emphasis added.)   The sentence italicized above requiring one resident to be a registered owner was a change from rules previously in effect
                

After notifying appellants of the alleged violation of the above regulation and unsuccessful attempts to resolve the situation amicably, respondent petitioned for and obtained an injunction pursuant to Civil Code section 798.88 prohibiting appellant Evans from "permitting an unlawful occupant to reside in her mobilehome" and prohibiting appellant Erb from residing in the mobilehome "without the written consent" of the mobilehome park.

DISCUSSION

Civil Code section 798.88 provides that "any person in violation of a reasonable rule or regulation of a mobilehome park may be enjoined from the violation...." (Emphasis added.) Appellants contend that, since the rule is unreasonable, respondent is not entitled to injunctive relief. A parallel argument is that a park rule restricting subleasing is an unreasonable restraint upon alienation and therefore unenforceable. We must determine the reasonableness of the restriction as it applies to appellants in this case. Our inquiry focuses upon Civil Code section 711, dealing with restraints on alienation, upon cases involving similar restrictions, and upon the Mobilehome Residency Law. ²

I

Civil Code section 711 provides: "Conditions restraining alienation, when repugnant to the interest created, are void." Several California cases have interpreted the section with regard to assignments and leases, but none with regard to mobilehome subleases. ³

In City of Oceanside v. McKenna (1989) 215 Cal.App.3d 1420, 264 Cal.Rptr. 275, the court upheld the prospective enforcement of restrictions similar to ours in a publicly subsidized condominium project. The court stated: "Reasonable restrictions on alienation have been held consistent with Civil Code section 711. ' "The day has long since passed when the rule in California was that all restraints on alienation were unlawful under the statute; it is now the settled law in this jurisdiction that only unreasonable restraints on alienation are invalid." [Citation.]' [Citation.] [p] In determining whether a restraint on alienation is unreasonable, the court must balance the justification for the restriction against the quantum of the restraint. The greater the restraint, the stronger the justification must be to support it. [Citation.]" (Id. at p. 1427, 264 Cal.Rptr. 275.)

The court pointed out that the restriction in that case furthered the state policy of providing housing for low and moderate income persons, and that the owner purchased the condominium with at least "constructive notice of the restriction on leasing and the requirement of owner occupancy." (City of Oceanside v. McKenna, supra, 215 Cal.App.3d 1420, 1429, 264 Cal.Rptr. 275.)

The Oceanside court concluded that the restriction on renting was not per se unreasonable, that what is reasonable depends on the particular circumstances of the case, and that where such a restriction is in force at the time of purchase and is part of the purchase agreement, subsequent enforcement of the restriction prohibiting rental is reasonable.

In Laguna Royale Owners Assn. v. Darger (1981) 119 Cal.App.3d 670, 174 Cal.Rptr. 136, the court held that where a condominium association's agreement with a condominium owner prohibited transfer of a condominium without the prior approval of the association, the association was prohibited from unreasonably withholding consent to a transfer.

The court stated: "We reject [the] Association's contention that its right to give or withhold approval or consent is absolute. We likewise reject defendants' contention that the claimed right to approve or disapprove transfers is an invalid restraint on alienation because it is repugnant to the conveyance of a fee. We hold that in exercising its power to approve or disapprove transfers or assignments [the] Association must act reasonably...." (Laguna Royale Owners Assn. v. Darger, supra, 119 Cal.App.3d 670, 680, 174 Cal.Rptr. 136.)

The court noted the difference between a lessor/lessee relationship and that of a group of condominium owners, all members of the association, stating that "it is essential to successful condominium living and the maintenance of the value of these increasingly significant property interests that the owners as a group have the authority to regulate reasonably the use and alienation of the condominiums." (Laguna Royale Owners Assn. v. Darger, supra, 119 Cal.App.3d 670, 682, 174 Cal.Rptr. 136.) The court went on to apply a standard of reasonableness to the application of the restriction and held that withholding approval of a transfer to a timeshare arrangement was unreasonable.

Ritchey v. Villa Nueva Condominium Assn. (1978) 81 Cal.App.3d 688, 146 Cal.Rptr. 695, concerned a situation somewhat similar to ours. Ritchey purchased a condominium, subjecting him to the association's bylaws. Subsequent to the purchase, the association adopted bylaws restricting occupancy to persons 18 years of age and over. Rejecting Ritchey's claim that this unreasonably prevented him from leasing to a person with minor children, the court noted that "[w]hether an amendment is reasonable depends upon the circumstances of the particular case." (Id. at p. 694, 146 Cal.Rptr. 695.) The court found the restriction reasonable, since Ritchey purchased subject to the association's rules which were in turn subject to change only by approval of three-fourths of the condominium owners, and since the restriction upon alienation was in fact only a right of first refusal. This was because section 2792.25, subdivision (b) of the former California Administrative Code provided that the restriction would be deemed waived unless the association procured an equally favorable offer. (Id. at p. 695, 146 Cal.Rptr. 695.)

The Ritchey case held a partial restriction on leasing (to persons with children under 18) to be reasonable even when the provision was enacted subsequent to the would-be lessor's purchase. Although there the court held a restriction somewhat similar to ours retroactively enforceable against a condominium owner, that case differs from ours in three significant aspects: First, the regulation there was far less restrictive, prohibiting only residency by children rather than prohibiting all subleasing as in our case. Second, the regulation was adopted by vote of more than 75 percent of the ownership based on total value of all the units in the project. There is a significant difference between submitting oneself to the future wishes of a community of which one is a part and in which one shares a general community of interest, and of being subject to future regulations imposed by a park owner who may or may not have goals in accord with homeowners and residents. Finally, and most importantly, as the Ritchey court was careful to point out, the restriction there was actually only a right of first refusal. The association had a period of 15 days to match the owner's agreement; otherwise the restriction was waived. Hence, the restriction in Ritchey was of no economic significance to the homeowner.

In 1978, the Legislature enacted the Mobilehome Residency Law (MRL). Part of the law states: "The Legislature finds and declares that, because of the high cost of moving mobilehomes, the potential for damage resulting therefrom, the requirements relating to the installation of mobilehomes, and the cost of landscaping or lot...