Earlier this week, the Ninth Circuit announced that a petition for “en banc” (entire Court) rehearing of the April panel decision in ELS v. San Rafael was denied. Unfortunately, this decision is a near-term win for the advocates of rent control because it keeps in place the April 2013 three judge panel decision, which had reversed a favorable decision by District Court Judge Vaughn Walker. Judge Walker found San Rafael’s mobile home rent control ordinance unconstitutional. We don’t believe that this particular battle is over. ELS may seek review by the U.S. Supreme Court.
While some local governments and rent control advocates will certainly hail the San Rafael decision as a victory, they will be reading too much into the case and likely overreach. Whether or not the Supreme Court grants review, the decision leaves open the door to future constitutional challenges by park owners who are denied rent increases, particularly those who purchased before rent control was adopted.
HKC’s message to park owners under rent control is do not lose heart! We are right and we will prevail with the right case. In fact, we have already succeeded in many cases by bringing claims which have led to the elimination or modification of rent control ordinances. In the meantime, there continue to be opportunities to maximize property values through rent increase applications, subdivisions or closures. The pursuit of these opportunities may also help set the stage for successful taking claims. We hope that you will continue to defend your property rights through your participation and support of organizations such as WMA and CMPA. If you have any questions about the decision, rent control or subdivisions, we urge you to give HKC partners Mark Alpert, Bill Dahlin or John Pentecost a call at (714) 432-8700 for more information.
