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.
Real Cases in Real Estate will learn and be entertained by lawsuits
involving nuisance, trespass, zoning violations, deed restrictions, title
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cited case summary highlights the essential law of the case and explains the
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follow real estate law professionally or as a hobby, you'll find something new
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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.
Properties v. Santa Monica Rent Control Board, 203 Cal. App. 4th
739, 2012 Cal. App. LEXIS 142 (February 16, 2012) [enhanced version available to lexis.com subscribers].
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