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Real Estate Law

Real Cases in Real Estate By Andrea Lee Negroni, Esq. – September 18th, 2012 Update

Real Cases in Real Estate is a weekly update on real estate law, with legal principles illustrated and explained by lawsuits from around the country. The topics are wide-ranging for appeal to a broad spectrum of readers including lawyers, homeowners, investors and the general public. Andrea Lee Negroni, a Washington DC attorney and legal writer with 25 years of experience in financial services and mortgage law, contributes the case summaries.

Followers of Real Cases in Real Estate will learn and be entertained by lawsuits involving nuisance, trespass, zoning violations, deed restrictions, title insurance, public utilities, mechanics liens, construction defects, adverse possession, foreclosure and eviction, divorce and marital property rights, tenants' rights, and more. Real Cases in Real Estate uncovers the unpredictable, amusing, and sometimes outrageous disputes between next-door neighbors, contractors and homeowners, condo boards and residents, real estate brokers and homebuyers, and zoning administrators and developers.

Each fully cited case summary highlights the essential law of the case and explains the principal legal theories and concepts relevant to the outcome. Plain language treatment makes Real Cases in Real Estate accessible to lawyers and laymen alike.

Whether you follow real estate law professionally or as a hobby, you'll find something new and useful every week in Real Cases in Real Estate.

Updates for the Week of September 18th, 2012

Adjusting Hot Tub Temperature Does Not Entitle Tenants to Rent Reduction on a Rent-Controlled Apartment.

Santa Monica Properties owns a 32-unit apartment building in Santa Monica, California. The rents are subject to rent control. The complex has a hot tub and sauna. When the landlord lowered the temperature on the hot tub during working hours, two tenants sought decreases in their rents. The tenants, paying $1,214 and $1,440 for 2-bedroom, 2-bath apartments, claimed the landlord reduced housing services by cutting down the hours the jacuzzi was heated and installing a timer on the sauna that kept the heat on for 25 minutes, rather than the previous one hour.

A rent control board hearing examiner heard the evidence in July 2008 and ordered a decrease of $48 a month to one tenant and $25 a month to the other. The landlord appealed.

The purpose of the rent control law is to prevent rents from being increased unreasonably based on the serious housing shortage in the City of Santa Monica, California. In determining what is a fair rate of return for the landlord, increases or decreases in living space, furniture, furnishings, equipment and services all count. The rent control board concluded that because conditions changed to reduce the landlord's maintenance expenses, the rent being charged had become excessive. The California appeals court found this conclusion "infected by error" and did not understand how any decrease in service "no matter how minimal, particularly if the decrease has no effect on the adequacy of housing services or compliance with health and safety codes," could give the rent control board the authority to reduce rents.

In fact, "a reduction in recreational facilities may be considered on a rent decrease petition," but "minor adjustments in the hours of luxury spa services" don't justify rent decreases without evidence that they result in excessive rents. The hearing examiner did not explain how he reached the specific rent reductions ordered. The absence of any correlation between the reduced spa service hours and the rent reductions was also a defect in the rent control board's findings. The California appeals court ordered the rent decreases to the tenants reversed.

Santa Monica Properties v. Santa Monica Rent Control Board, 203 Cal. App. 4th 739, 2012 Cal. App. LEXIS 142 (February 16, 2012) [enhanced version available to subscribers].


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