How Does The California Mobile Home Residency Law Affect Mobile Home Park Owners?

May 4, 2015

 

Mobile Home Parks and Manufactured Housing Communities are very unique. They offer a style of housing unlike any other type of community in California. In most cases, people either purchase their home or they rent it. In the case of Manufactured Housing Communities, both are done, often simultaneously. Due to the unique nature of mobile home park residency, California has adopted a completely different set of laws that govern mobile home residents and mobile home park owners. This set of laws is called the California Mobile Home Residency Law.

 

Under the California Mobile Home Residency Law (CAMRL) specific responsibilities are delegated to both the mobile home park owner and the mobile home park tenant. Some of the largest issues that are covered by the CAMRL include, what constitutes a tenant that falls under the Mobile Home Residency Law, a mobile home park owner’s failure to maintain the park’s common areas and the sale of a mobile home in a rental park. All of these issues greatly affect the management of a mobile home park and the right's of residents in a mobile home park.

 

Who Falls Under the Mobile Home Residency Law?

 

The first step in understanding the California Mobile Home residency Law is to identify who actually falls under the set of laws. Many might just assume that any person that lives in a manufactured housing community, mobile home park or trailer park falls under the CAMRL. That is not the case.

 

There are a couple different ways in which the law is not so cut and dry. The first being that occupants of a Recreational Vehicle Park, which is intended for a short term stay can fall under the CAMRL. Any tenant that has occupied a lot in a park for more than nine straight months is considered a resident of the park. (“2015 California Mobilehome Residency Law” 73) As a resident of an RV Park, the same laws will apply to a person occupying an RV, trailer or fifth wheel as a person that is occupying their home in a Manufactured Housing Community.

 

Another instance where the definition of a mobile home resident is not so clear is the rental of a park owned manufactured home to a tenant. When a mobile home owner rents one of his or her homes to another party, their agreement is subject to landlord-tenant laws, not the mobile home residency law. Now that it is understood who falls under the Mobile Home Residency Law, the major issues invoked by the laws can be looked at with an understanding of who they apply to.

 

What Is Failure To Maintain Litigation?

 

One of the largest problems mobile home park owners and operators are facing in the state of California these days is the threat of failure to maintain litigation. Park owners and operators are required to maintain the park improvements and infrastructure to the standard that they were presented to their residents at the beginning of residency. In addition to maintaining park infrastructure and improvements, park ownership is required maintain the same level of services in the park, under the Mobile Home Residency Law. For instance, if a park owner’s pool motors suddenly break down and the pool is no longer operable, a mobile home park resident could file a lawsuit alleging failure to maintain services in the park. The only stipulation to filing this type of lawsuit is, the mobile home resident must provide park management with at least 30 days advance notice of their intention to file a lawsuit.

 

Failure to maintain lawsuits have made headlines during the past year. Back in April of 2014, the San Jose Mercury News wrote an article about a failure to maintain lawsuit, which was brought against California Hawaiian Mobile Home Estates in San Jose, CA.

 

The residents of California Hawaiian Mobile Home Estates filed a failure to maintain lawsuit against the park claiming that there are frequent sewage backups, potholes, electrical blackouts and a swimming pool filled with geese feces.(Kaplan, Tracey) Eventually, the jury awarded $111,000,000 to the plaintiff’s, which included $95,770,000 in punitive damages, which are uninsurable. This case is currently in the process of appeal and it is unlikely that such a substantial award will stand, as the highest award provided previously in a failure to maintain lawsuit was $12,000,000. Even if the award does not stand, it is evident that this type of lawsuit is a major issue for mobile home park owners and operators.

 

Who Can Mobile Home Residents Sell There Home To?

 

The next issue brought about by the mobile home residency law, which more directly affects mobile home park residents, are the laws pertaining to the sale of a mobile home in a rental park. Under the Mobile Home Residency Law, there are three parties involved in the sale or transfer of a manufactured home’s ownership. The first two parties involved in the transaction would be the seller of the mobile home and the purchaser of the mobile home, just as in the sale of most other forms of property. The third and final party involved in the transaction is mobile home park management. In order for the sale of a mobile home to go through in a rental park, park management must first approve the new homeowner for tenancy in the park.

 

This is an important function of the Mobile Home Residency Law for Park Owners as it allows them to have some say on who lives in their property. Management of the park cannot arbitrarily deny the purchasing party’s application for residency. There are only two ways in which mobile home park management can deny an applicant. The first being, the buyer's inability to pay rent and charges of the park. The second being, the buyer's inability to comply with park rules and regulations as indicated by prior tenancies. (Talley, Vickey) This law was designed with the intent of protecting the Mobile Home Park Owner's interest in space rent.

 

Mobile Home Parks and Manufactured Housing Communities are Excellent Investment Properties that can generate a great return on investment. When purchasing a Mobile Home Park, Trailer Park or RV Park it is extremely important to understand the Mobile Home Residency Law, in order to prevent litigation with residents. Here at California Southwestern Insurance Agency we have worked in the Mobile Home Industry for over 40 years. We understand the threats that Mobile Home Parks face and we can design an insurance program an insurance program that will properly cover your investment.

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