Roble Vista Associates v. Bacon

• Decision Date: 02 April 2002
• Docket Number: No. H023150.,H023150.
• Citation: 97 Cal.App.4th 335,118 Cal.Rptr.2d 295
• Court: California Court of Appeals Court of Appeals
• Parties: ROBLE VISTA ASSOCIATES, Plaintiff and Respondent, v. John BACON, Defendant and Appellant.

118 Cal.Rptr.2d 295

97 Cal.App.4th 335

ROBLE VISTA ASSOCIATES, Plaintiff and Respondent, v. John BACON, Defendant and Appellant.

No. H023150.

Court of Appeal, Sixth District.

April 2, 2002.

Douglas J. Abbott, Los Altos, Attorney for Appellant John Bacon.

Rochelle Browne, Los Angeles, Richards, Watson & Gershon, Ariel Pierre Calonne, City Attorney, City of Palo Alto, for Amicus Curiae City of Palo Alto.

Todd B. Rothbard, San Jose, for Respondent Roble Vista Assoc.

MIHARA, J.

The City of Palo Alto enacted the Rental Housing Stabilization Ordinance (Ordinance),¹ which provides that a landlord is required to offer a one-year lease to a prospective tenant. The sole issue on appeal is whether state law preempts the Ordinance. We conclude that it does not and reverse the judgment.

Statement of Facts

When the City Council adopted the Ordinance in 1980, it made the following findings: "It is found and declared that there is a growing shortage of, but increasing demand for, housing in the City of Palo Alto. Such shortage and increased demand, coupled with increasing inflation, have placed substantial pressure on those residents of Palo Alto seeking rental housing. This Council finds that tenants are entitled to a contractual relationship with a landlord that offers some assurance of stability under the terms of a written lease so as to minimize displacement of tenants into a rental housing market which affords them few and expensive options." (§ 9.68.010.)²

The Ordinance requires that a landlord offer new and renewing tenants a "written lease which has a minimum term of one year." (§ 9.68.030, subd. (a).) It also requires that the lease "set the rent for the rental unit at a rate or rates certain and these rates shall not be otherwise modified during the term of such lease." (§ 9.68.030, subd. (d).) The Ordinance further provides that if a tenant initially rejects a one-year lease, the landlord must annually offer a one-year lease to this tenant. (§ 9.68.030, subd. (e)(3).) The "[f]ailure of a landlord to comply with any of the provisions of this chapter shall provide the tenant with a defense in any legal action brought by the landlord to recover possession of the rental unit" or "to collect rent." (§ 9.68.040, subds.(a), (b).)

On October 16, 1994, John Bacon leased an apartment from Roble Vista Associates in the City of Palo Alto. The initial term of the lease was six months. Roble Vista did not offer a one-year lease to Bacon at that time or at any time thereafter.

On January 24, 2000, Roble Vista served Bacon with a 30 day notice to vacate the apartment by February 23, 2000. On February 4, 2000, Bacon delivered to Roble Vista the rent payment for the entire month of February. Roble Vista returned the check one week later.

On February 9, 2000, Roble Vista served Bacon with a three-day notice to pay rent or quit for rent pro-rated through February 23, 2000. Within the three-day period, Bacon offered to pay Roble Vista the full amount of rent for February, which Roble Vista declined to accept.

On February 18, 2000, Roble Vista commenced an unlawful detainer action against Bacon for his failure to pay pro rata for the month of February. In his answer, Bacon alleged that Roble Vista evicted him in retaliation for his complaints about an elevator and that Roble Vista's demand for possession violated the Ordinance.

Following trial, the court found that Bacon did not prevail on his retaliatory eviction defense due to his failure to pay the amount demanded in the three-day notice. The trial court also found that state law preempted the Ordinance, and entered judgment in favor of Roble Vista for possession of the premises, rent and damages of $2,145, attorney's fees of $300, and costs of $126.

Bacon appealed. The appellate division of the superior court held that the Ordinance was invalid and certified its opinion for publication. This court ordered on its own motion that the matter be transferred to this court for hearing and decision. (Cal. Rules of Court, rule 62, subd. (a).)

Discussion

Bacon³ contends that state law does not preempt the Ordinance and thus is entitled to its substantive defenses.⁴

I. Standard of Review

Whether state law preempts a local ordinance is a question of law that is subject to de novo review. (Horton v. City of Oakland (2000) 82 Cal.App.4th 580, 584, 98 Cal.Rptr.2d 371.)

II. Preemption

"A county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws." (Cal. Const, art. XI, § 7.) Charter cities, such as the City of Palo Alto, may enact legislation regarding "municipal affairs." (Cal. Const., art. XI, § 5.) However, "[i]f otherwise valid local legislation conflicts with state law, it is preempted by such law and is void." (Shetwin-Williams Go. v. City of Los Angeles (1993) 4 Cal.4th 893, 897, 16 Cal.Rptr.2d 215, 844 P.2d 534, quoting Candid Enterprises, Inc. v. Grossmont Union High School Dist. (1985) 39 Cal.3d 878, 885, 218 Cal.Rptr. 303, 705 P.2d 876.) "A conflict exists if the local legislation duplicates, contradicts, or enters an area fully occupied by general law, either expressly or by legislative implication." (Ibid., internal citations and quotation marks omitted.)

In the present case, the appellate division found that state law preempted the Ordinance. It relied on this court's opinion in Tri County Apartment Assn. v. City of Mountain View (1987) 196 Cal.App.3d 1283, 242 Cal.Rptr. 438. In Tri County, the City of Mountain View enacted an ordinance requiring a landlord to give 60 days notice of any rent increase. At that time Civil Code section 827 required that a landlord give 30 days notice of any rent increase. This court stated that the issue was "whether a municipal ordinance restricting the effective date of proposed rental increases is a valid rent control measure or a prohibited trespass into landlord-tenant areas preempted by state law." (Id, at p. 1286, 242 Cal.Rptr. 438.) The City of Mountain View argued that the ordinance should be classified as a permissible control of rent increases. However, this court concluded that the ordinance addressed notification, not rent control, because it dealt "directly and unequivocally with the subject of when a landlord must notify a tenant about a rent increase." (Id. at p. 1293, 242 Cal.Rptr. 438.) This court then considered "whether the Legislature [had] preempted the field of notification in landlord-tenant relationships." (Ibid.)

In Tri County, we stated that "[l]andlord-tenant relationships are so much affected by statutory timetables governing the parties' respective rights and obligations that a `patterned approach' by the Legislature appears clear." (Id. at p. 1296, 242 Cal.Rptr. 438.) This court then noted that the ordinance adopted the same purpose as the statute, i.e., appropriate notification, but changed the statewide chronology. (Ibid.) This court also found that "the extensive scheduling provided by the Legislature reveals that the timing of landlord-tenant transactions is a matter of statewide concern not amenable to local variations," and that the ordinance "directly conflicts with the legislative scheme." (Id, at p. 1298, 242 Cal.Rptr. 438.) Accordingly, we held that state law preempted the ordinance. (Ibid.)

Here the appellate division found that the Ordinance "`duplicate], contradict[s], or enter[s]' the field of notification or timing of landlord-tenant relationships as provided for by the Legislature." The appellate division stated that "[t]he effective result of the ordinance is to require a one-year notice to quit rather than the thirty days provided by state statute. (Civ.Code, §§ 827, 789, 790, 1946.) Palo Alto should not be able to alter through subterfuge the thirty-day notice provision of state law by prohibiting any changes in the tenancy's terms except at the beginning of each year." (Ibid.)

We disagree with the appellate division's characterization of the Ordinance as requiring a one-year notice to quit. In our view, the Ordinance requires that a landlord offer a one-year lease, thus addressing the duration of the lease. The Ordinance does not specify the amount of notice that must be given to terminate a tenancy.⁵ Accordingly, the present case is readily distinguishable from Tri County.⁶

The issue before us is whether state law has preempted local regulation regarding the length of a lease. We first note that the Legislature has not preempted all local regulation of landlord/tenant relationships despite numerous statutes regulating these relationships. (Birkenfeld v. City of Berkeley (1976) 17 Cal.3d 129, 142, 130 Cal.Rptr. 465, 550 P.2d 1001; Fisher v. City of Berkeley (1984) 37 Cal.3d 644, 709, 209 Cal.Rptr. 682, 693 P.2d 261.) "Whether the relevant field be deemed to be rent control as such or a broader aspect of landlord-tenant relations [citation], there is no legislative indication of a `paramount state concern [which] will not tolerate further or additional local action.'" (Birkenfeld, supra, 17 Cal.3d at p. 142, 130 Cal. Rptr. 465, 550 P.2d 1001, quoting In re Hubbard (1964) 62 Cal.2d 119, 128, 41 CaLRptr. 393, 396 P.2d 809.)

Roble Vista has not cited, nor have we found, a state statute governing when or if leases must be offered. Similarly there is no state statute governing what the terms of any such lease must be. Thus, the Ordinance does not duplicate or contradict any statute.

We next consider whether the Ordinance enters a field fully occupied by state law. (Sherwin-Williams, supra, 4 Cal.4th at p. 898, 16 Cal.Rptr.2d 215, 844 P.2d 534.) "[L]ocal legislation enters an area that is fully occupied by general law when the Legislature has expressly manifested its intent to fully occupy the area [citation], or when it has impliedly done so in light of one of the following indicia of intent: (1) the subject matter has been so fully and completely covered by general law as to...