Phil Querin Q&A: Home On Storage Agreement is Not Maintained - 3 Day Notice of Non Compliance

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Phil Querin

Question - A resident moves out of their house but the daughter continues to pay a storage fee and signed a MHCO Storage Agreement. The home is not being occupied by anyone. All storage fees are current. However, no one is maintaining the yard or outside of the home. This is required under the Storage Agreement, and work needs to be performed immediately. The MHCO storage agreement refers to a three (3) day notice in the event of non-compliance. Does the community owner give a 3-day notice for non-compliance? If so, what happens next if there is no compliance? Does the landlord file an FED? Should the landlord stop accepting storage payment?

Answer: You are referring to MHCO Form 35B "Manufactured Home Storage Agreement (With Homeowner)." Before addressing your specific questions, it is necessary to point out what this form is intended to do. Here are some that come quickly to mind: (a) A resident, living alone, moves out of the home and wants to sell it on site; (b) A person inherits or buys the home, but cannot be approved for occupancy due to the background check or their financial condition; (c) A resident, living alone, passes away, and the estate wants to sell it.

It is important to remember that this is a "storage" agreement not a "rental" agreement. In fact, it expressly disclaims a "landlord-tenant" relationship between the community and the home owner. Accordingly, the legal relationship is more akin to one in which a party stores their property in a commercial storage facility.

You should not treat a breach of the Storage Agreement as something that is remedied by going to FED court. Rather, the provisions of Oregon law dealing with statutory liens in ORS 87.152 et. seq. apply. This process can get very complicated, and I highly recommend that you secure the services of an attorney before proceeding.

Lastly, the MHCO Storage Agreement contains a provision for mandatory arbitration, in lieu of any other court or legal process. However, the box on the form must be checked in order for it to apply. The reason that this arbitration alternative exists is because it was believed (and still is) that the process mandated by the statutes might be better implemented for park owners through arbitration, which can be cheaper, faster, and easier - especially if the matter becomes contested.

The MHCO form does require that the home be maintained by the owner. Accordingly, you may wish to consider sending a notice to the owner demanding that they do the clean-up work or you will do so, and pass the charge on to them. I don't think the issue of payments and maintenance are the same. Accordingly, I don't believe there is a need to discontinue accepting payments. However, all of this needs to be handled carefully, and for this you should speak with your attorney.

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