Opposition Brief — Sandpiper Mobile Village v. City of Carpinteria

No. 92-1418

- — —-

OF THE

United States

OCTOBER TERM 1992

SANDPIPER MOBILE VILLAGE,

A Limited Partnership,

Petitioner,

VS.

THE CiTy OF CARPINTERIA,

Respondent.

On Petition For A Writ Of Certiorari

To The Second Appellate District,

Division Six, Court of Appeal

For the State of California

RESPONDENT’S BRIEF IN OPPOSITION

DONALD R. LINCOLN

(Counsel of Record)

LINDA B. REICH

ENDEMAN, LINCOLN, TUREK & HEATER

600 B Street, Suite 2400

San Diego, California 92101

(619) 544-0123

PETER BROWN,

City Attorney

THOMAS WISE,

Deputy City Attorney

HATCH & PARENT

21 East Carmilo Street

Santa Barbara, California 93101

(805) 963-9231

Attorneys for Respondent

City of Carpinteria

Bowne of Los Angeles, Inc. Law Printers (213) 627-2200

=~

i

QUESTIONS PRESENTED

1, Whether the state court was correct in ruling that the City

of Carpinteria’s Rent Stabilization Ordinance did not constitute a

federal regulatory taking, even though it restricts a parkowner’s

ability to increase space rent whenever a mobilehome is trans-

ferred from one homeowner to another.

2. Whether the state court was correct in ruling that the City

of Carpinteria’s Rent Stabilization Ordinance is not a violation of

federal substantive due process even though it restricts a

parkowner’s ability to increase space rent whenever a mobilehome

is transferred from one homeowner to another.

li

LIST OF PARTIES

The parties to the proceeding below were the Petitioner, Sand-

piper Mobile Village, a limited partnership, and Respondent, City

of Carpinteria.

iii

TABLE OF CONTENTS

Page

oe yy 9 i

ee ccc ch csc asecsesncstesesecess ii

es Se iii

ey 8 | >. I V

Ne ce hws ce ssp bnnscdccsased sees l

eek kaa s cess sasaesissecdeses 2

CONSTITUTIONAL PROVISIONS AND STATUTES

EE 2

MUPUEMIMNEUE GE EEEEL CADE... ccc cc cece cence 3

ees ok a 5c 5 bu oss 500.004.6000 3

scenic enc saesscesaescscscees 4

1. The State Supenor Court Ruling ............... 4

2. The State Court Of Appeal Decision............ 5

3. The California Supreme Court’s Denial of Review 6

WHY THIS WRIT SHOULD BE DENIED ........... 6

I

THE LOWER COURT'S DECISION IS CONSISTENT

WITH THIS COURTS DECISION IN YEE AND

OTHER CALIFORNIA RENT CONTROL CASES... 6

II.

THE COURT BELOW FULLY CONSIDERED AND

CORRECTLY DECIDED SANDPIPER’S TAKING

ee Lees Eb dy see b RNS AN0 5 vecdce ences 1]

A. The Court Below Correctly Ruled That Carpinteria’s

Ordinance Does Not Constitute A Physical Taking .. 11

B. The Court Below Correctly Ruled That Any As Ap-

plied Regulatory Taking Claim Is Not Ripe ........ 1]

C. The Court Below Correctly Ruled That Sandpiper’s

Facial Regulatory Claim Was Meritless............ 13

1. Carpinteria’s Ordinance Does Not Deprive Sandpi-

per Of All Economic Use Of Its Property ....... 14

iV

TABLE OF CONTENTS

Page

2. On Its Face The Ordinance Substantially Advances

Legitimate State Interests ..................... 15

a. Carpinteria’s Ordinance Protects Current Home-

owners From Excessive Rent Increases And Pro-

tects The Investment in Their Homes ........ 16

b. The Ordinance Protects Future Homeowners In

See NE sane at epenkecceseasantesase 18

Ill.

THE COURT BELOW FULLY CONSIDERED AND

CORRECTLY DECIDED THAT CARPINTERIA’S

ORDINANCE DOES NOT VIOLATE SUBSTAN-

Pigs f° $< ee ne 21

SE eG Vo 0 ob Oak ota ek eae ba eae 22

en Aad SMe Ant A > A-1

Vv

TABLE OF AUTHORITIES

Cases

Page

Agins v. Tiburon, 447 U.S. 255, 100 S.Ct. 2138, 65 L.Ed.2d

SE SOD nk ne wake wes hvansbeekusndeees Civenecers 14

Andrus v. Allard, 444 U.S. 51, 100 S.Ct. 318, 62 L.Ed.2d 210

PRUE cab cin bec eevaed chide ons asekecebanss Fesbaanes 15

Azul Pacifico v. City of Los Angeles, 948 F.2d 575 (9th Cir.

1991), opinion withdrawn, 973 F.2d 704, (9th Cir. 1992),

cert. denied, __ U.S. __, 113 S.Ct. 1049, 122 L.Ed.2d 357

CIOS civic eek ek ebb ehecssutasaeecaneaubaens 13, 17, 19

Block v. Hirsch, 256 U.S. 135, 41 S.Ct. 458, 65 L.Ed. 865

SUMED sib cca swn cel desea tas chee ieee 0S 60Ra Ess 14, 21

Blue Jeans Equities West v. City and County of San Fran-

cisco, 3 Cal.App.4th 164, 4 Cal.Rptr.2d 114 (1992), cert.

denied, __ U.S. _, 113 S.Ct. 191, 121 L.Ed.2d 135 (1992) 15

Carson Mobilehome Parkowners Ass'n v. City of Carson, 35

Calas t64, S07 CIO. Be GIGee) i vos on ccececceess 21

Casella v. City of Morgan Hill, 230 Cal.App.3d 43, 280

Cal.Rptr. 876 (1991), cert. denied, _ U.S. —, 112 S.Ct.

0665; 196 L.BGOS FET CGP ED o6n ic secs eees 10, 15, 18, 23

Commercial Builders of Northern California v. City of Sacra-

mento, 941 F.2d 872 (9th Cir. 1991), cert. denied, __ US.

sci Ae DE CORT, TES Cae Se COUPES 5 vies cecce 15

Day-Brite Lighting, Inc. v. Missouri, 342 U.S. 421, 72 S.Ct.

me Fe of. re reer eee 20

De Anza Properties X Lid. v. County of Santa Cruz, 936 F.2d

& fe Meee eee eer eer rere ati 13

Eamielio v. Liberty Mobile Home Sales, Inc., 208 Conn. 620,

546 A.2d 805 (1989), appeal dismissed, 489 U.S. 1002, 109

Se. LOGE, TES Lie Ce CEUNED 6 ce cctndcencanices 20

Ferguson v. Skrupa, 372 U.S. 726, 83 S.Ct. 1028, 10 L.Ed.2d

OP RIN o cceadccddceeeeacunactcenunenaaaeseeasens 20

vi

TABLE OF AUTHORITIES

CASES

Page

First English Evangelical Lutheran Church v. County of Los

Angeles, 210 Cal.App.3d 1353, 258 Cal.Rptr. 893 (1989)

cert. denied, 493 U.S. 1056, 110 S.Ct. 866, 107 L.Ed.2d 950

BO eee eee ee ere Tere Tee Ee Tere eee eee 8

Fisher v. City of Berkeley, 37 Cal.3d 644, 209 Cal.Rptr. 682,

affirmed, 475 U.S. 260, 106 S.Ct. 1045, 89 L.Ed.2d 206

Eres verre eerie re rT eT Tee eT Te eee eT TT ee 22

Hall v. City of Santa Barbara, 833 F.2d 1270 (9th Cir. 1986),

cert. denied, 485 U.S. 940, 108 S.Ct. 1120, 99 L.Ed.2d 281

TE dea eg gare aA et 4,7

Kendall v. Ernest Pestana, 40 Cal.3d 488, 220 Cal.Rptr. 818

er Geka Grek eGe AN ELS EAR SOLES SHEN OMS 23

Keystone Bituminous Coal Ass'n v. DeBenedictis, 480 U.S.

470, 107 S.Ct. 1232, 94 L.Ed.2d 472 (1987) ......... 14,15

Lucas v. South Carolina Coastal Council, 505 U.S. __, 112

Sem Sr PR & &, 26) re 14

Nash v. City of Santa Monica, 37 Cal.3d 97, 207 Cal.Rptr.

285 (1984), app. dism., 470 U.S. 1046, 105 S.Ct. 1740, 84

i Crete Li ties bach eben bao 21

Nolian v. California Coastal Comm'n, 483 U.S. 825, 107

Se es He Maes OTE CHOOT cacccccnncnsveces 15,18

Oceanside Mobilehome Parkowner’s Assn. v. City of

Oceanside, 157 Cal.App.3d 887, 204 Cal.Rptr. 239 (1984)

LOR et ok a re 8,9, 16

Palomar Estates East v. City of San Marcos, San Diego

MOE SOUS BUG, POGUES 2 ow cece cccceneesecscees 17

Penn Central Transportation Co. v. New York City, 438 US.

104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978) .......... 12, 15

Pennell v. City of San Jose, 485 U.S. 1, 108 S.Ct. 849, 99

aad scent ca agages east oa 6.0% 1}, 21

Pinewood Estates of Michigan v. Barnegat Township Leveling

Board, 898 F.2d 347 (3rd Cir. 1990)...............0.5. 4,7

Vii

TABLE OF AUTHORITIES

CASES

Page

Sandpiper Mobile Village v. City of Carpinteria,

10 Cal.App.4th 542, 12 Cal.Rptr.2d 623

Ls ! PePOPPPPreTITTrere Teer ee SR 14,.12 032

Schnuck v. City of Santa Monica, 935 F.2d 171

‘ ? | PPE EE ETRE oT ee 22

Sierra Lake Reserve v. City of Rocklin, 938 F.2d 951 (9th Cir.

1991), vacated, _ U.S. __, 113 S.Ct. 31, 121 L.Ed.2d 4

| er eee er rr rrr rer er errr cers re 22

Williamson County Regional Planning Comm. v. Hamilton

Bank, 473 U.S. 172, 105 S.Ct. 3108, 87 L.Ed.2d 126

(rrr rer rrr ry rrr Tyre ee TS 12

Yee v. City of Escondido, 224 Cal.App.3d 1349, 274 Cal.Rptr.

551 (1990), affirmed, 503 U.S. —, 112 S.Ct. 1522, 118

Le COE CWE bese kaevewess 5, 6, 8, 9, 10, 11, 12, 17, 18

Statutes

California Constitution, Art. I, sec. 19............00000 6 4,9

Mobilehome Residency Law (Civil Code sec. 798

4 8 eeerreerercre eTTerecy ery Tire yee ST

United States Constitution, Sth & 14th Amendments ....2, 4,9

Se To MN GN oo kono eca sew acre hhh eee kee eee 2

er es Ge bia vk bo a btiectceeeavisneeciaes 13

Texts and Articles

Baar, “The Right to Sell The ‘Im'’mobile Manufactured Home

in its Rent Controlled Space in the ‘Im'mobile Home Park:

Valid Regulation or Unconstitutional Taking?’ 24 Urban

Lawyer 157 C1IG8Z) on nn ccececcrencecenssvnseccccone 16

Manheim, “Tenant Eviction Protection and the Takings

Clause,” 1989 Wisc. L. Rev. 925 ..........ccecececees 15

Nutt-Powell, “Manufactured Homes, Making Sense of a

Housing Opportunity,” (Auburn House Publishing Co.,

Deaton, WER CORE a ac vcs ccc kecncsnsnsevevcseeecens 23

No. 92-1418

In the Supreme Court

OF THE

United States

OCTOBER TERM 1992

——

SANDPIPER MOBILE VILLAGE,

A Limited Partnership,

Petitioner,

VS.

THE CITY OF CARPINTERIA,

Respondent.

On Petition For A Writ Of Certiorari

To The Second Appellate District,

Division Six, Court of Appeal .

For the State of California

RESPONDENT'S BRIEF IN OPPOSITION

Respondent, City of Sandpaper (“City”), respectfully requests

that this Court deny Sandpiper Mobile Village’s (“Sandpiper”)

Petition for Writ of Certiorari (“Petition”) seeking review of the

California Court of Appeal opinion in this case.

OPINIONS BELOW

On March 19, 1991, the California state trial court (Santa

Barbara Superior Court, Case No. 177809) issued its Order

granting Judgment on the Pleadings and dismissing Sandpiper’s

action. See, Order, Petition at D24-25.

On October 15, 1992, the California Court of Appeal (Second

Appellate District, Division Six, Case No. B058435) issued its

opinion affirming the Judgment of Dismissal. The Opinion is

2

reported at 10 Cal.App.4th 542, 12 Cal.Rptr.2d 623; see also, Slip

Opinion, Petition at Ai-21.

On February 11, 1993, the California Supreme Court (Case

No. S029800) issued its one page ruling denying Sandpiper’s

Petition for Review. See, Ruling, Petition at B22.

JURISDICTION

The opinion of the California Court of Appeal, Second Appel-

late District, Division Six, was entered October 15, 1992. On

February 11, 1993, the California Supreme Court denied Sandpi-

per’s Petition for Review. Sandpiper’s Petition for Certiorari was

docketed with the United States Supreme Court on March 1,

1993. The jurisdiction of the United States Supreme Court was

invoked under 28 U.S.C. section 1257.

CONSTITUTIONAL PROVISIONS AND

STATUTES INVOLVED

The Fifth Amendment to the United States Constitution pro-

vides in pertinent part:

No person shall... be deprived of .. . property, without due

process of law; nor shall private property be taken for public

use, without just compensation.

The California Constitution, Article I, Sec. 19, provides in

pertinent part:

Private property may be taken or damaged for public use

only when just compensation, ... has first been paid to, or

into court for, the owner.

The California Mobilehome Residency Law (Cal. Civ. Code,

Section 798 et seq.) governs many aspects of the relationship

between a mobilehome parkowner and a mobilehome owner

residing on a rented space in a mobilehome park. Civil Code

Section 798.55(a) contains legislative justification for the unique

protections provided mobilehome owners. Protections include

restrictions on terminating a space tenancy (e.g., Civil Code,

Sections 798.55(b), 798.56) and restrictions preventing a

3

parkowner from interfering with or preventing a homeowner from

selling his home to a new purchaser as long as the prospective

homeowner has the financial ability to pay the space rent and does

not have a prior history indicating that he or she will not comply

with the rules and regulations of the park. (E.g., Civil Code,

Section 798.74).

[California Civil Code, Sections 798.55, 798.56, 798.56a, and

798.74 are set forth in Appendix F to Sandpiper’s Petition at F34-

52.]

In March 1980, the City of Carpinteria passed Ordinance 287

establishing mobiiehome rent stabilization. Pursuant to that ordi-

nance and its amendments,' each year the parkowner is limited to

charging as a “maximum rent”, the base rent on a certain date

(here November 1, 1987) increased by 75% of the CPI increase

from a certain date (here November 1, 1987). See, Ordi-

nance 419, sec. 5.69.040, RA at A2. In addition, the parkowner

has the opportunity to seek additional rent increases in order to

ensure that he receives a “just and reasonable return.” (See,

Ordinance 371, sec. 5.69.050, Petition at E27-29.)

STATEMENT OF THE CASE

A. Background

The City of Carpinteria is located in the County of Santa

Barbara in the State of California.

‘Ordinance 287 added Chapter 5.69 to the Carpinteria Municipal

Code. That Chapter has been amended several times. Ordinance 371,

enacted April 22, 1985 (see excerpts in Appendix E to Sandpiper’s

Petition at E26-33 and additional excerpts, Respondent’s Appendix

(“RA”) at Al) readopted and extended the ordinance until June 30,

1990. Later amendments include Ordinance 388, enacted February 10,

1986 (the last restatement of the entire ordinance), Ordinance 419,

enacted October 26, 1987 (see excerpts RA at A2), and Ordinance 450,

enacted August 28, 1989 which extended the effect of Chapter 5.69

“until the vacancy factor in mobilehome parks in the City rises to three

percent, or more for a period of one year.”

4

At the time of its construction Sandpiper was located outside

Carpinteria and subject to the jurisdiction of in the County of

Santa Barbara. In 1979 the County of Santa Barbara enacted

Ordinance 3122 establishing mobilehome rent stabilization.’ The

County Ordinance, like Carpinteria’s, provided no exception from

rent regulation merely because a mobilehome was transferred

from one homeowner to another.

In 1987, Carpinteria annexed Sandpiper into the City of

Carpinteria. As a result it became subject to the provisions of the

Carpinteria Ordinance.

B. Procedural History

1. The State Superior Court Ruling

On July 21, 1989, without first requesting any rent increase

other than the automatic 75% of the CPI under the City Ordi-

nance, Sandpiper filed a Complaint in the Santa Barbara Superior

Court. Primarily relying on Hall v. City of Santa Barbara, 833

F.2d 1270 (9th Cir. 1986), cert. denied, 485 U.S. 940, 108 S.Ct.

1120, 99 L.Ed.2d 281 (1988), Sandpiper alleged that because the

Ordinance did not permit it to automatically increase rents

whenever a mobilehome was sold on site, the Ordinance consti-

tuted a “taking” of its property, was irrational and served no

legitimate governmental purpose.’

Ordinance 3122, enacted October 22, 1979, added Chapter 11A to

the Santa Barbara County Code. Similar to the later adopted

Carpinteria Ordinance it generally limited rent increases to 75% of the

increase in the CPI (sec. 11A-6) and also gave the parkowner an

opportunity to seek additional rent increases to obtain a “just and

reasonable return.” Sec. 11A-5. It also was amended several times. The

version in effect when Sandpiper was annexed to the City of Carpinteria

was Ordinance 3589 enacted October 6, 1986.

Although Sandpiper’s original Complaint referred to takings only

under the California Constitution, Article I, sec. 19, in subsequent

pleadings and arguments both at the trial and appellate levels, it clearly

indicated that it was also alleging takings and substantive due process

violations under the Fifth and Fourteenth Amendments to the United

States Constitution.

5

On December 4, 1989, the Honorable Ronald C. Stevens,

Judge of the Santa Barbara Superior Court, issued a Memoran-

dum of Intended Decision overruling the City’s Demurrer to the

Complaint. However, following the state court of appeal decision

in Yee v. City of Escondido, 224 Cal.App.3d 1349, 274 Cal.Rptr.

551 (1990), and a new motion by City, on March 19, 1991 the

Honorable Bruce Wm. Dodds, Judge of the Santa Barbara

Superior Court entered an Order granting Judgment on the

Pleadings. See, Petition at D24-25.

2. The State Court of Appeal Decision

On May 9, 1991, Sandpiper filed a Notice of Appeal with the

state Court of Appeal. At oral argument the parties informed the

Court of Appeal that the United States Supreme Court had

granted certiorari in Yee, that Yee had been orally argued on

January 22, 1992, and that the Supreme Court’s decision in Yee

could well be dispositive of the appeal. Thereafter, the Court of

Appeal issued an Order taking the matter off calendar pending

the Supreme Court ruling in Yee.

On April 1, 1992, the United States Supreme Court decided

Yee v. City of Escondido, 503 U.S. —~, 112 S.Ct. 1522, 118

L.Ed.2d 153 (1992) unanimously affirming the state Court deci-

sion, and rejecting the Hall physical taking analysis. See, Yee,

supra, 118 L.Ed.2d at 164-68. The Court also examined substan-

tive due process and regulatory taking challenges but did not pass

on either. /d. at 168-72.

After Yee the Court of Appeal in Sandpiper authorized supple-

mental briefing and oral argument on the “regulatory taking”

issue.

On October 15, 1992, in a decision reported as Sandpiper

Mobile Village v. City of Carpinteria, 10 Cal.App.4th 542, 12

Cal.Rptr.2d 623 (1992) (see also Slip Opinion, Petition at Al-

21), the Court of Appeal affirmed. It held that Carpinteria’s

Ordinance (1) does not constitute a physical taking of Sandpi-

per’s property (Jd. at 547), (2) is rational and serves a legitimate

public purpose and therefore does not violate substantive due

process (/d. at 547-548), and (3) on its face validly regulates

a

6

mobilehome rent. The Court did not consider any regulatory

taking claim “as applied” because Sandpiper had not alleged

“that it has attempted to change the use of the park or to apply

for rent increases.” Jd. at 549.

3. The California Supreme Court’s Denial of Review

On November 17, 1992, Sandpiper filed a Petition for Review

with the California Supreme Court. On January 19, 1993, the

California Supreme Court denied Sandpiper’s request for review.

See Ruling, Petition at B-22.

WHY THIS WRIT SHOULD BE DENIED

I

THE LOWER COURT’S DECISION IS CONSISTENT

WITH THIS COURT'S DECISION IN YEE AND OTHER

CALIFORNIA RENT CONTROL CASES

While Sandpiper’s Petition never specifically referred to this

Court’s decision in Yee v. City of Escondido, supra, 118 L.Ed.2d

153, it is apparent that Sandpiper interprets that decision as

supporting its regulatory taking argument. See, Petition, i (Ques-

tions Presented). In fact, the lower court’s decision is totally

consistent with Yee.

In Yee, this Court considered a very similar challenge to

another city’s mobilehome rent review ordinance. There the

parkowner also alleged that the Ordinance constituted a taking

because it did not permit a parkowner to automatically raise rents

when a mobilehome was sold or transferred. 118 L.Ed.2d at

164-165.

On April 1, 1992, this Court in a unanimous opinion by Justice

O’Connor held that Escondido’s Ordinance, even when consid-

ered against the backdrop of the California Mobilehome Resi-

dency Law (Cal. Civil Code sec. 798 et seq.) did not constitute a

“physical taking” of the parkowner’s property. Yee, supra, 118

L.Ed.2d 153.

Since this was the first time that the Supreme Court had ever

considered a mobilehome case the Court’s statements are illumi-

5

nating. First, it acknowledged that “mobilehomes are largely

immobile as a practical matter.” 118 L.Ed.2d at 162. Second, it

recognized that California had enacted the Mobilehome Resi-

dency Law in recognition of the unique problems of and need to

protect mobilehome residents. 118 L.Ed.2d at 163. Third, it noted

that while the Mobilehome Residency Law provides several

protections it does not put limits on rents; to close this gap, several

communities had adopted mobilehome rent control ordinances.

118 L.Ed.2d at 163.

Yee argued that as a result of the lower rents under the

Escondido ordinance, the value of the mobilehomes would in-

crease and that when the current occupant sold the mobilehome,

he/she would receive a “premium” corresponding to this increase

in value. Ibid. However, this Court indicated, even assuming the

above allegations were true, the ordinance would not constitute a

“physical taking” because nothing in Escondido’s ordinance or

the Mobilehome Residency Law required the parkowner to sub-

mit to the physical occupation of its land. 118 L.Ed.2d at 165-67.‘

After thus rejecting the Hall “physical taking” analysis, this

Court also examined Yee’s “substantive due process” and “regu-

latory taking” challenges. 118 L.Ed.2d at 168. As to the due

process claim, this Court concluded that since the issue had not

been raised or decided below “we will not consider it here.”

118 L.Ed.2d at 169.

Finally, the Court addressed Yee’s “regulatory taking” claim.

Earlier in the opinion, the Court had noted that Yee’s allegations

that the only person benefitting from the ordinance was the

current mobilehome owner “might have some bearing on whether

the ordinance was a regulatory taking because it might shed some

light on whether there is a significant nexus between the effect of

the ordinance and the objectives it is supposed to advance.”

‘In so doing the Court disapproved two prior Federal Circuit Court

cases (Hall v. City of Santa Barbara, supra, and Pinewood Estates of

Michigan v. Barnegat Township Leveling Board, 898 F.2d 347 (3rd Cir.

1990). See, 118 L.Ed.2d at 164.

8

118 L.Ed.2d at 167.° However, when faced with the “regulatory

taking”’ claim this Court chose not to decide that issue. Instead, it

construed its grant of certiorari as only addressing the “physical

taking” issue and decided “to leave the regulatory taking issue for

the California courts to address in the first instance.” 118 L.Ed.2d

at 172.

Far from being inconsistent with Yee, the Court of Appeal

decision in Sandpiper is clearly the type of state court action

anticipated by this Court. The fact that this Court indicates that a

certain set of facts might be relevant to a regulatory taking claim

does not mean that upon further inquiry it will in fact state such a

cause of action. See, e.g., First English Evangelical Lutheran

Church v. County of Los Angeles, 210 Cal.App.3d 1353, 258

Cal.Rptr. 893 (1989), cert. denied, 493 U.S. 1056, 110 S.Ct. 866,

107 L.Ed.2d 950 (1990) (On remand from United States Su-

preme Court, which had held that a landowner is entitled to

compensation — not merely injunctive relief — when a court

finds there has been a unconstitutional regulatory taking, the state

Court sustained dismissal of a regulatory taking claim for failure

to state a claim because the regulation did not constitute a taking

of all use of the landowner’s property). In Sandpiper the Court of

Appeal directly considered whether this type of ordinance consti-

tuted a regulatory taking and correctly concluded that no “taking”

was involved because the City had not denied the parkowner all

“economically viable use of [the] land” (Sandpiper, 10

Cal.App.4th at 550) and because the ordinance “substantially

advances a legitimate state interest.” Jd. at 551.

Prior California decisions are also consistent with Sandpiper. In

Oceanside Mobilehome Parkowners’ Ass'n v. City of Oceanside,

157 Cal.App.3d 887, 906-07, 204 Cal.Rptr. 239 (1984), it was

argued that the combined effect of the Mobilehome Residency

‘The Court also mentioned that the extent to which the ordinance

deprived petitioners of the ability to choose incoming tenants may also

be relevant to a regulatory taking argument. 118 L.Ed.2d at 167. Justices

Blackmun and Souter, while concurring in the Court’s decision, did not

join in the references to the relevance of Yee’s claims to a regulatory

taking. See, 118 L.Ed.2d at 172-73.

9

Law (Civil Code sec. 798, et seq.) and the Oceanside

Mobilehome Rent Control Ordinance allowed the tenants to sell

their homes for a premium, thereby transferring the increase in

value from the owner to the tenant and thus violating the

parkowner’s rights under the “taking” clauses of the Fifth and

Fourteenth Amendments and sections | and 19 of Article I of the

California Constitution.

In rejecting these arguments, the Court stated:

The ordinance is structured to establish a base rent which

reflects general market conditions and incorporates relevant

pricing factors. Rents will not be “reduced more than re-

quired for the purposes of the police power.”

157 Cal.App.3d at 907.

The Oceanside Court correctly understood that the proper

focus of inquiry for determining whether there is a “taking” is not

the price received by the homeowner for his home, but the rent

allowed the parkowner. If the rent permitted is “just and reason-

able” then there is no “taking” because the parkowner has

received all he is due.

The Oceanside Court also recognized that, due to the “realities

of a captive market” and “the proprietary interests mobile home-

owners have individually and cumulatively in their homes”, the

ordinance has a legitimate purpose in protecting the value of the

homeowner’s equity interest in their homes. See, 157 Cal.App.3d

at 911 n.9.

In Yee v. City of Escondido, supra, 224 Cal.App.3d 1349, the

state Court of Appeal, in affirming a dismissal, expressly rejected

taking challenges to an ordinance which did not permit a

parkowner to automatically raise rents merely because a

mobilehome was sold or transferred. The Court pointed out that:

[ plaintiffs’ complaints never allege the Escondido ordinance

is irrational because it denies them fair and reasonable rents.

Indeed, the owners have never attempted to obtain Escon-

dido’s approval for what they consider to be a ‘fair’ rent. In

the absence of such a contention, we assume the rents

provided for by the ordinance are fair. If they are, there is no

ll

10

‘taking.’ The fact that used mobilehomes in Escondido are

selling for more than they have in the past is irrelevant.

224 Cal.App.3d at 1354.

The Yee Court of Appeal decision clearly indicated that it

believed the ordinance to be “rational” and that under the

circumstances the decision whether to use rent control was “a

political issue for legislative action and not a question of constitu-

tional law for the courts.” Yee, 224 Cal.App.3d at 1358.

In Casella v. City of Morgan Hill, 230 Cal.App.3d 43, 57, 280

Cal.Rptr. 876 (1991), cert. denied, US. » 892 SAA.

1665, 118 L.Ed.2d 387 (1992), another state Court of Appeal,

when faced with the same question, concluded:

The stated purpose of the city’s ordinance is to control

excessive rental prices for the largely fixed-income residents

of mobilehome parks. This is unquestionably a legitimate

State interest. The City of Morgan Hill could reasonably

have concluded that the mobilehome rent control ordinance

would promote this goal. Whether as a means to achieve its

stated purpose rent control is a good idea is a political

decision — one which properly rests with the legislative

branch of government. We agree with Yee that this is “not a

question of constitutional law for the courts. [citation]”

230 Cal.App.3d at 57.°

*See also, Casella, supra, 230 Cal.App.3d at 57, agreeing with the

Hall dissenters that “‘[s]ignificant doubt’ as to whether a legislative

body’s goals are in fact achieved is not sufficient to warrant striking

down an ordinance[]... Legislation passes muster if the legislature

reasonably could have concluded that its action would promote a

legitimate state interest. The judiciary does not have the power to sit as a

‘superlegislature’ second-guessing the wholly economic regulations of

state and local governments.” (833 F.2d at 1284 [citations omitted],

Schroder, J. dissenting from the denial of en banc hearing).

1]

II

THE COURT BELOW FULLY CONSIDERED AND COR-

RECTLY DECIDED SANDPIPER’S TAKING CLAIMS

Sandpiper bases its argument for granting this Writ of Certio-

rari on the allegation that the State Court of Appeal decision is

“in error.” Petition at 11. Sandpiper’s argument is without merit.

A. The Court Below Correctly Ruled That Carpinteria’s Ordi-

nance Does Not Constitute A Physical Taking

This Court in Yee concluded:

The Escondido rent control ordinance, even considered

against the backdrop of California’s Mobilehome Residency

Law, does not authorize an unwanted physical occupation of

petitioners’ property, It is a regulation of petitioners’ use of

their property, and thus does not amount to a per se taking.

118 L.Ed.2d at 168.

Basing its decision on this Court’s Yee ruling, the Court of

Appeal discussed Sandpiper’s various physical taking contentions

and correctly concluded that “Sandpiper, like Yee, fails to estab-

lish a physical taking because there has simply been no compelled

physical occupation giving rise to a right to compensation...”

Sandpiper, supra, 10 Cal.App.4th at 547.

B. The Court Below Correctly Ruled That Any As Applied

Regulatory Taking Claim Is Not Ripe

This Court has generally declined to address the merits of

“takings” claims in cases in which the government had not yet

reached a final decision concerning the application of its regula-

tions to the property at issue. For example, in Pennell v. City of

San Jose, 485 U.S. 1, 108 S.Ct. 849, 99 L.Ed.2d 1 (1988),

appellants contended that San Jose’s rent control ordinance,

which allowed a hearing officer to consider the “hardship to a

tenant” when determining whether to approve a proposed rent

increase, was facially unconstitutional. This Court declared the

claim premature because San Jose had made no authoritative

determination as to how the regulations would be applied; i.e.,

——

12

“there [was] simply no evidence that the ‘tenant hardship clause’

ha[d] in fact ever been relied upon by a hearing officer to reduce

a rent below the figure it would have been set at on the basis of

the other factors set forth in the Ordinance.” 485 U.S. at 9-10.

Prior to this lawsuit, Sandpiper did not seek a rent adjustment

under the Ordinance and thus no final decision concerning the

application of the Ordinance to its property was before the lower

court. By failing to seek relief in the manner provided by the

Ordinance, Sandpiper failed to provide the City with an opportu-

nity to negotiate an agreement — viz., an acceptable rent in-

crease—that might obviate any perceived constitutional

deficiencies in the City’s rent control scheme. Moreover, without

knowing what rents the City will permit Sandpiper to charge, the

lower court could do no more than speculate about the economic

impact — if any — of the Ordinance on Sandpiper’s property or

the extent to which it interferes — if at all — with Sandpiper’s

investment-backed expectations. Consequently, any “as applied”

regulatory challenge is entirely unripe. See, Yee, supra, 118

L.Ed.2d at 169; see also, Williamson County Regional Planning

Comm. v. Hamilton Bank, 473 U.S. 172, 186-197, 105 S.Ct.

3108, 87 L.Ed.2d 126 (1985).

Under the circumstances, the Sandpiper Court of Appeal!

correctly ruled “Because Sandpiper has not alleged that it has

attempted to change the use of its park or to apply for rent

increases, its regulatory taking claim is not npe.” 10 Cal.App.4th

at 549.

"Since any applied regulatory taking claim was clearly unripe it was

unnecessary for the Coun below to discuss the constraints of “as

applied” regulatory takings pursuant to Penn Central Transportation Co.

v. New York City, 438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978).

Had it done so, the inquiry should have been relatively quick. At the

time it was annexed to the City in 1987, Sandpiper had already been

subject to a virtually identical County ordinance for the past eight years.

Therefore it is extremely difficult to imagine how “its distinct investment

backed expectations” (see, 438 U.S. at 124) could have been further

impacted or interfered with by the same provisions in the City

Ordinance.

——

13

C. The Court Below Correctly Ruled That Sandpiper’s Facial

Regulatory Claim was Meritless

After noting that Sandpiper’s Complaint did not set forth a

facial regulatory taking challenge, the lower court nevertheless

considered Sandpiper’s argument [first set forth in its Supple-

mental Brief to the Court of Appeal (after the United States

Supreme Court decided Yee)] that “the ordinance does not

substantially advance a legitimate governmental interest no mat-

ter how the ordinance is applied.” Sandpiper, supra, 10

Cal.App.4th at 549.

The Court of Appeal properly ruled that Sandpiper’s facial

regulatory taking challenge fails because the ordinance neither

deprives Sandpiper of all economic use of its property nor fails to

substantially advance legitimate state interests.*

*An alternative ground which supports the dismissal of Sandpiper’s

federal facial regulatory taking claim is that it was barred by applicable

statutes of limitations. Although City raised statutes of limitation as an

affirmative, defense in its answer, and at the Appellate level in both its

Respondent’s Supplemental Brief and Answer to Petition for Review,

the Court of Appeal only addressed the applicability of state statutes of

limitation to Sandpiper’s state taking claims. See Sandpiper, supra, 10

Cal.App.4th at 549 (finding Sandpiper’s state taking claim not barred

because brought within five years of the enactment of Ordinance 371).

Nevertheless, the law is clear that Sandpiper’s federal taking claim

arises when the ordinance is enacted. See, De Anza Properties X Lid. v.

County of Santa Cruz, 936 F.2d 1084, 1087 (9th Cir. 1991); Azul

Pacifico v. City of Los Angeles, 973 F.2d 704, 705 (9th Cir. 1992), cert.

denied, U.S. —___, 113 S.Ct. 1049, 122 L.Ed.2d 357 (1993). In

addition, to be timely such a federal claim must be brought under 42

U.S.C. sec. 1983 which is subject to a one year statute. De Anza, supra,

936 F.2d at 1084-85, Azul, supra, 973 F.2d at 705. Here Sandpiper

became subject to the City’s Ordinance in 1987 and did not file this suit

until July 1989. As a result its federal regulatory claim is clearly barred

on statute of limitations grounds also.

14

1. Carpinteria’s Ordinance Does Not Deprive Sandpiper Of

All Economic Use Of Its Property.

In Keystone Bituminous Coal Ass'n v. DeBenedictis, 480 U.S.

470, 495, 107 S.Ct. 1232, 94 L.Ed.2d 472 (1987), this Court

stated:

The test to be applied in considering this facial challenge is

fairly straightforward. A statute regulating the uses that can

be made of property effects a taking if it ‘denies an owner

economically viable use of his land. [citation ]’

Petitioners thus face an uphill battle in making a facial

attack on the Act as a taking.

See also, Agins v. Tiburon, 447 U.S. 255, 260, 100 S.Ct. 2138,

65 L.Ed.2d 106 (1980) (Unless the regulatory ordinance denies

the property owner substantially all economically “viable use of

land” there is no compensable taking); Lucas v. South Carolina

Coastal Council, 505 US. —__, 112 S.Ct. 2886, 120

L.Ed.2d 798, 813 (1992) (A regulation which denies “all eco-

nomically beneficial or productive use of land” is a taking).

Clearly, Sandpiper is not denied all economic use of its prop-

erty because it can and does receive rents.

The only “right” Sandpiper has lost is the “right” to extract

excessive rents from mobilehome owners due to the shortage of

mobilehome spaces and the immobility of mobilehomes. This

“right” is not a separate, legally protected interest in property. Cf.

Block v. Hirsch, 256 U.S. 135, 157, 41 S.Ct. 458, 65 L.Ed. 865

(1921) (Court upheld law providing “reasonable rent” while

depriving landlords of the right to “profit by the sudden influx of

people to Washington”).

Even assuming that the right to use its property in this manner

was a discrete and legally protected “property interest,” Sandpi-

per’s facial regulatory takings claim still fails. As the United

States Supreme Court has explained:

“Taking” jurisprudence does not divide a single parcel into

discrete segments and attempt to determine whether rights in

a particular segment have been entirely abrogated. In decid-

15

ing whether a particular governmental action has ‘effected a

taking, this Court focuses rather both on the character of the

action and on the nature of the interference with rights in the

parcel as a whole. ...

Keystone, supra, 480 U.S. at 497 (quoting Penn Central, supra,

438 U.S. at 130-31) (emphasis in original). Thus, “where an

owner possesses a full ‘bundle’ of property rights, the destruction

of one ‘strand’ of the bundle is not a taking because the aggregate

must be viewed in its entirety.” Keystone, supra, 480 USS. at 497

(quoting Andrus v. Allard, 444 U.S. 51, 65-66, 100 S.Ct. 318, 62

L.Ed.2d 210 (1979)). This standard entirely undermines Sandpi-

per’s attempted regulatory challenge: Sandpiper continues to rent

its property and remains free to sell its property or to put it to

alternative uses should it wish to do so.

2. On Its Face, The Ordinance Substantially Advances Legiti-

mate State Interests.

Relying on Nollan v. California Coastal Comm'n, 483 U.S.

825, 107 S.Ct. 3141, 97 L.Ed.2d 677 (1987), Sandpiper also

argues that Carpinteria’s Ordinance effects a regulatory taking

because it fails to substantially advance a legitimate governmental

interest. Petition at 11. This assumes the Nollan test applies to

regulatory takings. But see, Casella v. City of Morgan Hill, supra,

230 Cal.App.3d at 57 (The Court quoted from Manheim, “7en-

ant Eviction Protection and the Takings Clause,” i989 Wisc. L.

Rev. 925, and indicated that the Nollan heightened -scrutiny

approach may be limited to possessory taking cases.).”

%Other state and federal California Courts have also held that the

heightened scrutiny of the Nollan test applies only to unconstitutional

conditions and possessory takings, not regulatory takings. See, ¢.g., Blue

Jeans Equities West v. City and County of San Francisco, 3 CaLApp.4th

164, 169-170, 4 Cal.Rptr.2d 114 (1992), cert. denied, __ U.S. _, 113

S.Ct. 191, 121 L.Ed.2d 135 (1992) (Heightened scrutiny test did not

apply tc imposition of development fee on owner and developer);

Commercial Builders of Northern California v. City of Sacramento, 941

F.2d 872, 874 (9th Cir. 1991), cert. denied, — 0S... ... 112 3.04. 1997,

118 L.Ed.2d 593 (1992) (Same).

16

According to Sandpiper, departing homeowners are able to

capture the full value of the rent protection in the premium that

attaches to their mobilehomes. Sandpiper is wrong. As discussed

infra, the Ordinance protects both current homeowners and

future homeowners.

a. Carpinteria’s Ordinance Protects Current Homeowners

From Excessive Rent Increases And Protects The Investment

In Their Homes.

The Ordinance substantially advances Carpinteria’s perfectly

legitimate goal of protecting current homeowners from escalating

rent increases.

Furthermore, mobilehome owners have a substantial invest-

ment s# their homes. See, e.g., Baar, “The Right to Sell The ‘Im’

Mobile Manufactured Home in its Rent Controlled Space in the

‘Im’ Mobile Home Park: Valid Regulation or Unconstitutional

Taking?” 24 Urban Lawyer 157, 159 & nn. 10, 12 (1992) (“In

California, mobilehome prices ranging from $50,000 to $100,000

are standard....[a Los Angeles survey indicated that] on the

average mobilehome owners have triple the investment of

parkowners in their spaces.”). See also, Oceanside Mobilehome

Parkowners’ Ass'n v. City of Oceanside, supra, 157 Cal.App.3d at

911 n.9 (Local ordinance recognized that “[cJollectively, the

manufactured home owners have a greater investment than does

the manufactured home parkowner”).

In the absence of protection against rent increases on transfer, a

parkowner could force a current homeowner to se'l his/her home

at distressed sales prices thereby jeopardizing his/her investment.

For example, it is illuminating to note what occurred in the Hall

park after the City of Santa Barbara repealed vacancy control.

Almost immediately Mrs. Hall informed certain park residents

that she was going to raise rent on any transfer by $250 to $300

per month.

The results as reported by Mrs. Hall’s attorney, Mr. Jagiello,

were:

...in the Hall park over the last two years, not one coach

has sold, although many are for sale, but for the exception of

17

a coach that sold two weeks ago for one dollar. There were

attempts to give coaches away to charities and they wouldn't

take them. There is no market for coaches in Santa Bar-

bara.” See, Administrative Record to Palomar Estates East

v. City of San Marcos, San Diego Superior Court

No. N48882, April 9, 1990 Hearing Transcript at 7.

Although prior to this Court’s decision in Yee, supra, the Ninth

Circuit had followed Hall, supra, it had nevertheless recognized

the potential dangers of not regulating rents when mobilehomes

were transferred. See, Azul v. City of Los Angeles, 948 F.2d 575

(9th Cir. 1991), opinion withdrawn on rehearing in light of Yee,

973 F.2d 704 (9th Cir. 1992), where that Court had admitted:

[T]he ordinance does protect existing tenants from being

forced to sell their coaches at distress-sale prices in the event

landlords were to set rents for new tenants so high that no

one would want to buy the coach. See 740 F.Supp. at 780

(“Based on testimony from mobile home tenants, the City

found that, without vacancy control, it would be virtually

impossible for tenants to sell their homes on the pad because

landlords could raise the rent to a level that prospective

buyers could not afford.”). The correctness of the city’s

decision to insure coach owners against unscrupulous land-

lords in this way is a legislative question, not a judicial one.

“The Supreme] Court has consistently affirmed that States

have broad power to regulate housing conditions in general

and the landlord-tenant relationship in particular.” Loretto,

458 U.S. at 440, 102 S.Ct. at 3178. Because the vacancy

control provision serves the same governmental purpose —

protecting incumbent tenants — as the RSO we cannot say

that it is unconstitutional. Unlike the city’s other rationales,

this one falls within the traditional police power and thus

there is a sufficient nexus between the challenged provision

18

and a legitimate justification. See Nollan, 483 U.S. at 837,

107 S.Ct. at 3148.

948 F.2d at 583.'°

b. The Ordinance Protects Future Homeowners In The Same

Way.

The principal thrust of Sandpiper’s argument is that the Ordi-

nance is irrational because it does not protect purchasers from

increases in the prices they must pay for their homes.'' But see,

Casella, supra, which pointed out:

As Yee and others have pointed out, the increase in the

sales prices of mobilehomes resulting from rent control may

simply reflect the artificially low price caused by excessive

rents charged prior to its enactment. The mere fact that

increased coach prices are a corollary to rent control does not

establish that a taking has occurred, however. [Citation ]

230 Cal.App.3d at 54.

Even if the constitutionality of the Ordinance did turn on the

narrow question of whether it benefits future homeowners, the

Ordinance would withstand scrutiny even under the No/llan stan-

dard because it substantially advances the City’s interest in

protecting these individuals. The Ordinance protects these future

‘Tt is clear that in the absence of rent restrictions when a mobilehome

is sold or transferred certain parkowners would attempt to raise their

new rent to “all the market can bear.” Thus, a homeowner who in good

faith invested in a home, recognizing the reality that the home could not

be moved, could be faced with the prospect of losing the value of his or

her investment or remaining a captive in the mobilehome park.

Unless homeowners and their lenders are assured that the value of a

home will remain relatively stable, the mobilehome market will evapo-

rate, investments will be lost, and a legitimate affordable housing option

will be removed.

"Initially it is interesting to note that it is the parkowners, not the

future homeowners, who argue that the Ordinance fails to protect future

homeowners. This fact alone should give a Court pause before finding

that such future homeowners are not benefitted.

19

homeowners, just as it protects current homeowners, by prevent-

ing parkowners from charging excessive rents. This is by itself, a

legitimate state interest. Furthermore, future homeowners, no less

than current homeowners, in the absence of rent protection, might

be forced to sell their homes at distress sale prices (Azul, supra),

and the City has a legitimate interest in protecting the invest-

ments that these future homeowners make.

In addition, the Ordinance provides future homeowners a less

obvious, but ultimately no less important benefit — a significant

degree of financial stability. Many mobilehome homeowners are

either senior citizens living on fixed incomes or young families

struggling to pay for their first home. In either case, they need

protection against excessive rent increases. In the absence of rent

protection, such purchasers would have no way of planning for

potentially exorbitant rent increases that could wreak havoc with

their budgets and destroy the value of their investments in their

homes."

In sum, the investments of future as well as current homeown-

ers will be protected both from immediate extinguishment by

higher rents immediately following their purchase, and later

extinguishment caused by higher rents immediately following

their later sale. As a result, it is likely that future mobilehome

owners will be more willing to invest in the maintenance and

improvement of their mobilehomes; lenders will be more willing

to finance mobilehome purchases; mobilehome living will con-

tinue to be a legitimate affordable housing option.

'21n arguing that only current homeowners benefit from the Ordinance

because the alleged “premium” paid by the future homeowners exactly

equals their savings in rent, Sandpiper ignores these benefits that the

Ordinance clearly does afford future homeowners. Moreover, Sandpi-

per’s assumption that current homeowners can extract the full value of

future rent savings is questionable at best. At the time of sale, uncer-

tainty about a number of factors — not the least of which would be the

number and size of future Board-approved rent increases — would make

an accurate calculation of future rent savings virtually impossible. In

addition, Sandpiper’s theory assumes that individual homeowners have

sufficient market power to extract a “premium” from future purchasers.

20

Certainly the City of Carpinteria could reasonably conclude, as

have dozens of other communities,’’ that mobilehome parkowners

could do more harm to the public interest by charging excessive

rents to essentially captive homeowners than individual home-

owners could do by requesting excessive prices for their homes.

Cf., Eamiello v. Liberty Mobile Home Sales, Inc., 208 Conn. 620,

546 A.2d 805, 820 (1989), appeal dismissed, 489 U.S. 1002, 109

S.Ct. 1104, 103 L.Ed.2d 169 (1989), which in upholding the right

of a mobile home owner to sell his home on site stated:

In choosing the tenant rather than the mobile home park

operator as the recipient of this economic advantage arising

from the near-monopoly status of the industry, the legisla-

ture, by allocating its benefit to those who generally are more

in need, has not violated any constitutional principle. In our

view, [the statute] strikes a reasonably fair balance between

the economic interests of mobile home tenants and those of

mobile home park operators.

In any event, the choice of solutions belongs to the City. This

Court has long ago decided that the wisdom of laws are for those

elected to pass laws; the courts “do not sit as a superlegislature”

to reweigh those decisions in their own scales of justice. Day-Brite

Lighting, Inc. v. Missouri, 342 U.S. 421, 423, 72 S.Ct. 405, 96

L.Ed. 469 (1952). As Justice Black wrote in Ferguson v. Skrupa,

372 U.S. 726, 732, 83 S.Ct. 1028, 10 L.Ed.2d 93 (1963),

“[w]hether the legislature takes for its textbook Adam Smith,

Herbert Spencer, Lord Keynes” — or George Stigler, James

Buchanan, John Kenneth Galbraith or any other economist, for

that matter — “is no concern of ours.” It is respectfully submitted

that nothing authorizes this Court to substitute its judgment for

that of the City as to how best to protect current and future

homeowners’ significant investment in their homes and to protect

mobilehome living as an affordable housing option.

'’ According to a July 1, 1992 report by WMA (Western Mobilehome

Parkowner’s Association) approximately 50 California jurisdictions pro-

vide full or partial rent regulation when a mobilehome is sold or

transferred.

21

Il

THE COURT BELOW FULLY CONSIDERED AND COR-

RECTLY DECIDED THAT CARPINTERIA’S ORDI-

NANCE DOES NOT VIOLATE SUBSTANTIVE DUE

PROCESS

Sandpiper argues that the Ordinance is irrational because its

regulations on rent when mobilehomes are transferred do not

advance a legitimate governmental purpose. Sandpiper’s argu-

ment is without merit.

As the Sandpiper Court correctly pointed out, the Carpinteria

Ordinance seeks to remedy an inequitable market situation

caused by the scarcity of mobilehomes. The Ordinance protects

mobilehome owners from unreasonable space rental increases,

therefore protecting the homeowners’ investments, while provid-

ing parkowners with a reasonable return on the parkowner’s

investment. Sandpiper, 10 Cal.App.4th at 551.

In Pennell v. City of San Jose, supra, 485 U.S. at 12-14, this

Court rejected a similar contention that “[t]he objective of

alleviating individual tenant hardship is... not a policy that the

legislature is free to adopt in a rent control ordinance.” The Court

pointed out that “we have long recognized that a legitimate and

rational goal of price or rate regulation is the protection of

consumer welfare.” Jd. at 13.

Both the United States and California Supreme Courts have

previously held rent control to be a reasonable and legitimate

means of addressing problems related to scarcity in real property

and the high rents resulting from inequities in bargaining power.

See, Block v. Hirsch, supra, 256 U.S. at 157 (Rent control

approved as a method to prevent excessive profits for landlords);

Carson Mobilehome Parkowners Ass'n v. City of Carson, 35

Cal.3d 184, 189 n.4, 197 Cal.Rptr. 284 (1983) (The imposition of

mobilehome rent controls is a rational curative measure designed

to counteract the ill effects of a “shortage of mobilehome spaces

which has resulted in a low vacancy rate and rapidly rising space

rents.””); cf. Nash v. City of Santa Monica, 37 Cal.3d 97, 104-109,

207 Cal.Rptr. 285 (1984), app. dism., 470 U.S. 1046, 105 S.Ct.

1740, 84 L.Ed.2d 807 (1985) (A rent control ordinance which

required a predemolition permit before a landlord could demolish

ee

22

rental units was held to be reasonably related to the legitimate

goal of maintaining adequate rental housing); Fisher v. City of

Berkeley, 37 Cal.3d 644, 700-702, 209 Cal.Rptr. 682, affirmed on

other grounds, 475 U.S. 260, 106 S.Ct. 1045, 89 L.Ed.2d 206

(1986) (Provision of rent control ordinance which permitted

tenant to withhold the full amount of his rent if landlord failed to

register was reasonably related to its purpose).

The Ninth Circuit has agreed even in cases which otherwise

followed Hall. For example, in Sierra Lake Reserve v. City of

Rocklin, 938 F.2d 951 (9th Cir. 1991), vacated, it Sa

113 S.Ct. 31, 121 L.Ed.2d 4 (1992), the Ninth Circuit stated:

[T]he City council could reasonably believe that in the

majority of cases the ordinance serves the valid public

purpose of keeping mobile home rent from becoming prohib-

itively high. (Citation) How well the ordinance serves this

purpose is a legislative question, one the court will not

consider.

Id. at 958.

See also, Schnuck v. City of Santa Monica, 935 F.2d 171 (9th

Cir. 1991), wherein the Court upheld the City’s rent control

ordinance against a substantive due process attack noting that

“the Supreme Court has upheld numerous constitutional chal-

lenges to rent control laws” (see, 935 F.2d at 174 n.1). The

Schnuck Court stated that questions as to whether Santa Monica

had a legitimate governmental purpose for enacting rent control

generally should be left to the local legislature or the voters (Jd. at

175), and dismissed arguments that the Ordinance did not sub-

stantially advance its “purpose” by pointing out that the ordi-

nance’s “purposes” were not to be as narrowly defined as the

landlord wished.

CONCLUSION

Sandpiper’s Petition for Certiorari at times reads more like an

economic or political treatise than a legal brief. Time and time

again it asks the Court to base legal conclusions on its version of

23

“mobilehome economics.”'* Time and time again it asks this

Court to second guess the City’s determination (see Ordinance

371, sec. 1, RA A-1) that its Ordinance has been “effective” and

“beneficial”. Since both issues involve legislative not judicial

determinations this Court should decline the invitations.

Under the circumstances City respectfully submits that the

Court should deny Sandpiper’s Petition seeking review of the

taking and due process decisions of the state court because it is

clear that these decisions were properly made.

DATED: March 31, 1993

Respectfully submitted,

DONALD R. LINCOLN

(Counsel of Record)

LINDA B. REICH

ENDEMAN, LINCOLN,

TUREK & HEATER

PETER BROWN, City Attorney

THOMAS WISE,

Deputy City Attorney

Hatch & Parent

Attorneys for Respondent

City of Carpinteria

‘For example, it first contends that mobilehomes are “wasting as-

sets,” which depreciate in value (Petition at 17), but see, Nutt-Powell,

“Manufactured Homes, Making Sense of a Housing Opportunity”

(Aubum House Publishing Co., Boston, Mass. 1982) (Pointing out that

the historical view that mobilehomes depreciate like used cars has been

abandoned due to “mounting evidence that mobilehomes appreciate

rather than depreciate in value”). Although Sandpiper later admits that

“mobilehomes, in place in a Park, can frequently rise in price” (Petition

at 17), it contends all the appreciation belongs to the parkowner, who

owns the underlying land. /d. at 17-18. But see, Casella, supra, 230

Cal.App.3d at 55 (Pointing out that California property law considers

leasehold value the property of the tenant, not the landlord); see also,

Kendall v. Ernest Pestana, 40 Cal.3d 488, 504, 220 Cal.Rptr. 818

(1985) (Rejecting the assertion that any increase in market value of real

property during the term of the lease belongs to the lessor not the

lessee).

APPENDIX A

A-|

ORDINANCE NO. 371

AN ORDINANCE OF THE CARPINTERIA CITY

COUNCIL RE-ADOPTING AND EXTENDING

CHAPTER 5.69, AS AMENDED, OF THE

CARPINTERIA MUNICIPAL CODE RELATING TO

MOBILE HOME PARK RENT STABILIZATION,

FOR AN ADDITIONAL FIVE-YEAR PERIOD

(Excerpt)

SECTION |

WHEREAS, the Carpinteria City Council originally adopted,

by Ordinance 287, on March 10, 1980, a Mobile Home Park Rent

Stabilization program; and '

WHEREAS, said Ordinance 287 added Chapter 5.69 to the

Carpinteria Municipal Code and has subsequently been amended

for purposes of clarification; and

WHEREAS, said Chapter 5.69 of the Carpinteria Municipal

Code has proven to be an effective and beneficial program for the

people of Carpinteria; and

WHEREAS, Section 5.69.160 of said Chapter 5.69 provides

that said chapter shall expire on June 30, 1985, unless extended

by the City Council; and

WHEREAS. the Carpinteria Mobile Home Park Rent Stabili-

zation Board has recommended that said rent stabilization pro-

gram be extended for an additional five year period to June 30,

1990; and

WHEREAS, this City Council finds that it is in the public

interest to extend and continue said Chapter 5.69 of the

Carpinteria Municipal Code.

NOW THEREFORE, THE CARPINTERIA CITY COUN-

CIL DOES ORDAIN AS FOLLOWS:

A-2

ORDINANCE NO. 419

AN ORDINANCE OF THE CARPINTERIA CITY

COUNCIL AMENDING THE CARPINTERIA

MUNICIPAL CODE, AS AMENDED BY AMENDING

SECTIONS 5.69.040 AND 5.69.070, RELATING

TO MOBILE HOME PARK RENT STABILIZATION

(Excerpt)

SECTION 1

Section 5.69.040 of the Carpinteria Municipal Code, as

amended, is hereby further amended to read as follows:

C. Formula for Mobile Home Parks Annexed into the City on

or after January 1, 1987. Except as otherwise expressly provided

in this chapter, the maximum rent for each mobile home space

that management of a mobile home park in this category shall be

permitted to charge shall be set forth in an effective rent schedule

as follows:

The maximum allowable rent shall be calculated annually and

shall be the sum of the following:

1. The November 1, 1987 rent; and

2. The November |, 1987 rent times 75% of the ratio of

change in the Consumer Price Index (CPI).

D. Effective Rent Schedule for Annexed Mobile Home Parks.

Annually and as soon as practical after the release of the C.P.I.

for March of each year and using the July 1, 1987 rent schedules

previously filed by each annexed mobile home park, the city

manager shall make the calculations for each such mobile home

park, as provided by Paragraph C of Section 5.69.040 and shall

file same in the City Clerk’s Office as a rent schedule and mail a

copy of the applicable rent schedule to the management of each

such mobile home park, specifying the maximum rent for each

mobile home space. The rent schedule, if filed before July | of

that year shall become effective as of July | of that year or, if not

filed until after July 1, shall become effective as of filing.

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