Appellate Court Applies Permit Streamlining Act to Affirm Effect of City Acknowledging Completeness of Application; Restricts Consideration of Tenant Survey in Mobilehome Park Conversion Application

By William W. Abbott

Within the Subdivision Map Act (Map Act), the processing of a mobilehome park conversion (from rental to individual ownership) invokes some of the more complex procedures, and from a local government perspective, potentially involves an application with a lot of emotional baggage. Unlike other Map Act related applications, park conversions involve a tenant survey, the results of which have been the subject of a several appellate court decisions. The recent appellate opinion in Chino MHC, LP v. City of Chino (October 31, 2012, E053467) ___ Cal.App.4th ___, provides guidance in two areas: what is the effect under the Permit Streamlining Act of a city determination that an application is complete when later reviewing the mandated tenant survey form, and, are the results of the tenant survey the basis to deny a conversion request?

Chino MHC, park owner, sought conversion of a rental park to a subdivided park, wherein individual spaces could be sold. As provided for the Subdivision Map Act, the owner made contact with the residents to determine if there was a tenant association. The contact was necessary as the Map Act directs that a tenant survey be conducted through an agreement with tenant association, if any. (Government Code section 66427.5) The facts reflect that the operator made a series of attempts to determine the existence of a bona-fide association, and that the existence of a representative association was not clear cut. Eventually, the owner distributed a survey, based upon a standard form available from the State Department of Housing and Community Development, and forwarded those results as part of its application. The city determined the application to be incomplete as it was not prepared in conjunction with the residents' association, “if any”. The owner appealed the completeness determination, subsequently denied first by the planning commission and then by the city council. The owner then moved forward on two fronts: first, with the erstwhile association and the second, by a filing a writ against the city council’s denial. The city resolved the litigation by stipulating that the application was deemed complete. Subsequent survey efforts by the park owner lead to later planning commission approval and city council denial of the application. The city council denied the conversion/subdivision request the basis of the low resident support, as reflected in the survey, and upon the lack of evidence that the survey had been properly conducted. The owner appealed. The trial court granted the owner’s petition for writ of mandate. The court of appeal affirmed, although on slightly different grounds.

Ultimately, the appellate court reached two important determinations. First, under the Permit Streamlining Act, once the city determined (via stipulation) that the application was deemed complete, it was precluded from thereafter questioning the method by which the survey was conducted. In other words, the Permit Streamlining Act means what it says about the operative effect of an application being deemed complete. (Government Code section 65943) Second, the appellate court’s decision centered on the scope of allowed inquiry as to the results of the tenant survey. The appellate court reviewed the history to Government Code section 66427.5, finding that it had been adopted in response to an earlier appellate decision, El Dorado Palm Springs Ltd v. City of Palm Springs (2002) 96 Cal.App. 4th 1153. In light of the code's history, the Chino court concluded that while local government could consider the results of the tenant survey, it was for the limited of purpose of determining whether or not the conversion request was a sham, intended to evade rent control restrictions. While the total number of returned surveys was low, 42% supported it. The court also viewed the lack of responses as evidence that the conversion was not a sham.

William W. Abbott is a partner at Abbott & Kindermann, LLP. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, LLP at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, LLP, nor the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

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