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COVID-19: Considerations for Landlords and Property Managers

MHCO

 

COVID-2019 is a new strain of coronavirus that emerged in central China at the end of 2019 and continues to spread around the globe. The COVID-2019 outbreak has been declared a pandemic by the World Health Organization (WHO) and is already having a major effect on international commerce. As the outbreak expands in the United States, commercial real estate owners and property managers should be well prepared to monitor and address concerns impacting the industry as a result of the virus.

 

    The typical commercial lease and property management agreement does not address viral epidemics. The duties and obligations of a landlord or property manager regarding limiting tenants' and guests' risk of exposure to the virus depends on what services, if any, the landlord or property manager provides at the property. In a net leased property where the tenant is responsible for its own maintenance and cleaning services, the landlord's public health obligations would be limited. However, a landlord or property manager who provides cleaning, janitorial and security services such as in a commercial office building or shopping center, should consider implementing the following operational recommendations:

    • consult your local health department and the U.S. Centers for Disease Control and Prevention (CDC) for the latest information on the virus and guidelines for controlling transmission
    • clean routinely and frequently touched surfaces and objects, including but not limited to, bathrooms, security desk areas, elevator banks, turnstiles, escalators, door handles, communal kitchens or pantries, bathrooms and the like
    • offer materials, in multiple languages, to educate employees, visitors, vendors, delivery personnel and staff about proper hand hygiene and cough etiquette
    • install hand sanitizer stations in high-traffic areas of the building
    • advise any employees who may feel sick to limit face-to-face contact with others and to seek immediate medical help
    • consider alternatives and safety protocols for large, public events held on the building property
    • review your internal communications and preparedness plan and ensure that all building staff are ready, know their role in keeping the property and its guests safe, and are aware of all communication protocols
    • follow Occupational Safety and Health Act (OSHA) requirements, set forth in Sections 13 and 14 of OSHA No. 1 of 2006, which impose various duties on the employer to ensure a safe and healthy work environment
    • discuss human resource considerations such as screening employees that have traveled to areas where the virus has been reported and implementing protocols for dealing with a situation where an employee may be infected with the virus
    • review leave policies and confirm compliance with legal requirements around mandatory quarantines
    • consider ongoing communications with tenants and service providers to inform them of the steps you are taking to clean and sanitize the property and learn how they are addressing the outbreak with their employees and customers
    • conduct risk assessment analysis and anticipate supply chain interruption 
    • review any rights or remedies the property may have under policies of insurance, which may include coverage for business interruption
    • consult with counsel about the COVID-19's impact on the property, contractual obligations and business operations

    Phil Querin Q&A: Landlord Pass-Throughs of Public Service Charges

    Phil Querin

     

    Question: As a park owner we pass through the sewer and water charges to our residents. Currently, they are on 5-year leases, all expiring at various times. The leases address our right to pass through utilities. However, fire and police fees have been attached to the water/sewer bills we receive from the city. May we pass those additional fees through, and if so, how much notice must we give to the residents?

     

    Answer:  The short answer is Yes. The utilities section of the manufactured housing side of Oregon’s landlord-tenant law is ORS 90.560(4) provides:

     

    • “Public service charge” has the meaning given the term in ORS 90.315 (Utility or service payments).
    • ORS 90.315(1) defines:
      •  “Public services” payments to mean ‘municipal services and the provision of public resources related to the dwelling unit, including street maintenance, transportation improvements, public transit, public safety and parks and open space. (Emphasis added); and
      • “Public service charge” means a charge imposed on a landlord by a utility or service provider, by a utility or service provider on behalf of a local government or directly by a local government. (Note: public service charge” does not include real property taxes, income taxes, business license fees or dwelling inspection fees.)
    • ORS 90.570 provides: “A landlord, upon 60 days’ written notice to a tenant, may unilaterally amend a rental agreement[1]to require a tenant to pay to the landlord, as part of the utility or service charge, a pro rata proportion of any new or increased public service charge billed to the landlord by a utility or service provider or a local government for a public service provided directly or indirectly to the tenant’s dwelling unit or to the facility common area.” (Emphasis added.)
    • ORS 90.568 addresses “pro-rata billing” as follows:
      • “If allowed by a written rental agreement, a landlord using pro rata billing may require a tenant to pay to the landlord a utility or service charge that was billed by a utility or service provider to the landlord for a utility or service provided directly to the tenant’s space or to a common area available to the tenant as part of the tenancy. A landlord may include in pro rata billing a public service charge under ORS 90.570 (Public service charge pro rata apportionment).” (Emphasis added.)
      • A pro rata billing charge for tenants’ spaces must be allocated among them by a method that reasonably apportions the cost among the affected tenants and that is described in the rental agreement.
      • Methods that reasonably apportion the cost among the tenants include, but are not limited to, methods that divide the cost based on:
              • The number of occupied spaces in the facility;
              • The number of tenants or occupants in the dwelling or home compared with the number of tenants or occupants in the facility, if there is a correlation with consumption of the utility or service; or
              • The square footage in each dwelling, home or space compared with the total square footage of occupied dwellings or homes in the facility or the square footage of the facility, if there is a correlation with consumption of the utility or service.
    • A utility or service charge to be assessed to a tenant for a common area must be described in the written rental agreement separately and distinctly from the utility or service charge for the tenant’s space. (Emphasis added.)

     

    Conclusion and Caveats. So, yes, to the above question: Prepare a 60-day written Notice of Unilateral Amendment explaining the public service charge and the pro-rata allocation approach. Keep records of these utility charges for tenants to inspect if they want, and when they increase, make sure tenants are notified as soon as possible.  Just like increases in utility rates, they may be passed along – they don’t require additional advance notice.

     

    Utility pass-throughs can be very complicated for a variety of reasons. First and foremost, the legislation is created by committees of stakeholders including industry representatives for landlords (park and non-park owners), tenants, utility companies, lenders, and other interested parties. The results can be confusing, especially so because Oregon’s landlord-tenant law contains a “soft” bifurcation between non-MHPs and MHPs. I say “soft” because the MHP side, ORS 90.505+ occasionally depends upon and includes provisions from the non-MHP side, i.e., ORS 90.100 – ORS 90.493. These observations are not to diminished the legislative drafters’ skills – they must work with what they have.

     

    Familiarity with MHP utility laws i.e., ORS 90.560 to ORS 90.584 (including various stealth statutes that precede ORS 90.560!) requires time, patience, and care. The above summary responds only to the limited question presented. It does not address the MHP landlord’s responsibility to make sure that all park documents address the current utility rules applicable to their park and are sufficiently explained to incoming tenants. If in doubt, legal counsel should always be consulted. ~ Phil

     

    [1] Note: I recommend that each time a landlord seeks to “unilaterally amend” the rental agreement under Oregon law, a documents entitled “Unilateral Amendment” (or similar caption) be delivered to all affected tenants pursuant to ORS 90.155with the same diligence as if they were issuing a rent increase notice. This is really the only way the 60-day notice requirement can be established.  

    Phil Querin Q&A: Resident in Bankruptcy - Landlord's Rights and Responsibilities

    Phil Querin

    Answer. I'm not a bankruptcy attorney, but can tell you generally what the process entails. The moment the resident files for bankruptcy - or even tells you they filed, you should halt any action you're in the process of taking. In the case of the 72-hour notice, you should not file for eviction, even though no rent payment was timely made. In the case of a 30-day notice, same thing; don't file for eviction even though correction was not timely made.


    The main thing you want to verify is that, in fact, the resident did file for bankruptcy. In such case, they should be able to give you some evidence of the filing, such as the bankruptcy court filing number. Needless to say, if no filing was made, you are within your rights to proceed, at least until they do file, at which point you should then stop moving the matter forward legally. However, if the resident tells you they have taken out bankruptcy, you should assume it to be true unless and until you verify that that is not the case.


    Once you have verified that the resident is in bankruptcy, the question is what you should do. Not being a bankruptcy attorney, I cannot tell you how long to expect the entire process will take before the resident exits the process. However, if you are listed in the bankruptcy petition, you will receive a notice of the First Meeting of Creditors, which you should attend. That will give you an opportunity to learn what the resident intends to do, i.e. abandon the home or remain there and resume paying rent. Your goal should be to have the resident resume making rental payments as soon as possible. You will have an idea whether that will occur at the First Meeting of Creditors. The same thing applies if the resident is under a curable 30-day notice.


    If the situation is such that the tenant cannot pay, or cannot give you assurances that he or she can pay, or if the resident is under a default notice that is not curable, and you simply want them out, you should confer with a good bankruptcy attorney regarding your alternatives.


    What you will likely be presented with from your attorney is a decision about whether you should file with the court to "lift" the bankruptcy stay of proceedings[1], so that you may complete whatever legal action you were in the process of taking when the filing occurred.


    In the cases I have been involved with in the past, my experience was that if the bankruptcy stay was not going to assist the resident in dealing with his or her debts (e.g. it was a "no asset" case, and there was no chance the resident could pay the rent, etc.) the bankruptcy trustee would likely agree to lifting the stay so that your legal action could proceed. The decision to file is usually a cost-benefit analysis, e.g. what will the procedure cost, will it get the resident out sooner, and will you be able to get a rent-paying tenant into the space relatively quickly?


    The take-away in all bankruptcy filings is (a) you do not want to take any steps (including a demand letter from a lawyer) against the resident the moment you know (or reasonably believe) he or she has filed for bankruptcy, and (b) you want to consult with an attorney to evaluate your legal alternatives. I have seen many cases where landlords simply stop, wait for the bankruptcy to be over, before pursuing legal action. That is a mistake. Too many times, the bankruptcy continues for several months, the resident has remained there rent-free for that time, and the landlord is the one who loses. The same thing applies when the resident has abandoned the premises and then files for bankruptcy. While you cannot legally proceed until the stay is lifted or the bankruptcy proceeding has either been dismissed or is completed, waiting without taking action to lift the stay means the space cannot be re-rented to anyone else.

    [1] This means that upon filing, everything comes to a halt, i.e. it is "stayed."

    Legal Case #4: You Don’t Have to Break the Law to Accommodate a Tenant

    MHCO

     

    A somewhat odd case out of California illustrates another important qualifier of the landlord’s duty to provide a requested accommodation.

    Situation: A tenant with “electromagnetic hypersensitivity” (EHS), which causes him to be physically and neurologically affected by radiofrequency emissions from cell phone equipment, asks the city to remove a cell tower near his unit. The city refuses, noting that the tower’s placement is based on requirements of federal environmental law. So, the tenant sues the city and homeowners association for disability discrimination.

    You Make the Call: Does the tenant have a valid claim for failure to accommodate?

    Answer: No

    Ruling: The California federal court grants summary judgment to the defendants. Even if EHS is a “qualifying disability” under the FHA, the request to remove the cell tower isn’t a “reasonable accommodation” because it would force the city to violate the environmental law [Wolf v. City of Millbrae, 2021 U.S. Dist. LEXIS 159025, 2021 WL 3727072].

    Takeaway: You don’t have to provide accommodations that would require violating laws or lease obligations to other tenants. However, you should explore alternatives that would satisfy the requestor’s needs without violating laws or contractual obligations. There were no such alternatives available in the Wolf case.

    Tip: You need only grant requested accommodations that are reasonable. According to HUD, a request for an accommodation is reasonable if it:

    • Doesn’t cause landlords to incur an undue financial and administrative burden;
    • Doesn’t cause a basic or fundamental change in the nature of the housing program available;
    • Won’t cause harm or damage to others; and
    • Isn’t technologically impossible.

    To that list, you can add a request that doesn’t force the landlord to violate a valid law or contractual obligation.

     

    Pools and Summer Reminders: New Liability Claims for Discriminatory Management Guidelines

    Terry R. Dowdall

    The Basic Rule for Liability Avoidance in a Mobilehome Park 

    It is the parents’ responsibility, not management’s, to decide ability to swim and access privileges for minors. Access, hours, and supervision restrictions are illegal under the Federal Fair Housing Amend- ments Act of 1988 (FHAA).1 While narrowly drawn rules may differentially impact children (persons under 18 years of age), these are not advised. The “default setting” is best: the law requires that the parents be vested with exclusive discretion to decide, control and live with their choices for kid’s access and supervision issues. Likewise, scour the rules and regulations (and now, internal management policies, manuals, agreements and memoranda) to eliminate any rule which mentions “children.” Use of the term “children” is a trigger word, no different than use of any other label for a person in a protected class. The Department of Housing and Urban Development (HUD) treats children as “small adults” for purposes of scrutinizing rules.

    The Federal Fair Housing Amendments Act of 1988 (FHAA) created a new protected class of “familial status”. In California, the federal courts have addressed this requirements by ruling that “all age” communities may not discriminate against children, no more than management can discriminate against any other protected class.

    Federal Requirements and Over-Regulation 

    Let’s face it; some parents are not responsible. According to the Centers for Disease Control and Prevention, of all children one to four years old who died from an unin- tentional injury, almost 30% died from drowning. Fatal drowning remains the second-leading cause of unintentional injury-related death for children ages one to 14 years. The same report reveals that “the fatal drowning rate of African American children ages 5 to 14 is 3.1 times that of white children in the same age range.”

    1. E.g., United States v. Plaza Mobile Estates, 273 F.Supp.2d 1084 (C.D. Cal. 2003); Bischoff v. Brittain, No. 2:14-cv-01970-KJM-CKD, United States District Court, E.D. California (May, 2016).

     

    Mobilehome park swimming pools are deemed public, and re- quire fencing, postings and related equipment. In years past, it was believed that parkowners could require adult supervision in the swimming pool area, but it is for the parents to decide and control.

    State Requirements and Conflict with the FHAA and the FEHA

    California, meanwhile, promulgated modifications to Title 24, but apparently did not clear their proposals with any lawyer or the children’s rights lobby. The state mandated sign includes language mandated by Title 24 of the California Code of Regulations, as follows:

    “WARNING: NO LIFEGUARD ON DUTY Children under the age of 14 shall not use pool without a parent or adult guardian in attendance.”

    This language is a prima facie violation of the FHAA protections against discrimination on the basis of familial rights.2 Posting this sign places every operator of a Title 22 swimming pool (that’s us parkowners) in violation of the FHAA. If posted, any aggrieved family member may sue just because it is posted (enforced or not). Since posting this sign exposes a parkowner to liability, what should the parkowner do? First, offer to post the sign which would be consistent with the FHAA:

    “WARNING: NO LIFEGUARD ON DUTY Children under the age of 14 should not use pool without a parent or adult guardian in attendance; management recommends no one swim alone.”

    Despite entreaties made for clarification to resolve this conflict, to both the Department of Housing and Community Development (HUD) and the Department of Fair Employment and Housing (DFEH), there has been no response. This problem does not lie in an older persons (55+) park, by the way. This is because the “older persons” park is exempt from the familial status requirements. Since a parkowner may entirely exclude children due to the effect of the 55+ regulation, allowing kids at all is a benefit that is not required (total exclusions, pool hours, supervision are all allowable restrictions) all permissible in the “older persons” community at this time.

     

    2 . In striking down the legal requirement for signage as a discrimination defense, the central district judge held that " . . . there is nothing magical about the age of 18 or 14 years old if defendants' concerns are for the protection of the health and safety of the children or other residents in using recreational facilities or the swimming pool or riding bicycles. Such concerns could be addressed with the use of rules. Moreover, rather than being connected to such ages, bicycle and pool safety would be better served with a proficiency requirement." U.S. v. Plaza Mobile Estates. 

     

     

    In many counties, the illicit requirement is not applicable until capital renovation of the pool area. But if not, what do you do if the county representative refuses to consent to the suggested modification? Do you refuse to comply with state law in order to comply with the FHAA, or do you comply with the state mandate and violate the FHAA? As of this time, you must seek out counsel, pay them, obtain advice, and follow it.

    Management Communications Can Violate the FHAA

    In a housing case decided in Northern California in May, 2016, the landlord was called out for discrimination against children in an all age facility. In Bischoff v. Brittain,3 the on site management received training, including a “Resident Relations Training,” at seminars pro- vided by independent experts. A “Brief Recap of Notes” document summarizes several meetings and was distributed to the managers. The document stated that as to handling unsupervised children:

    1. If you have a young child not being supervised, walk the child home and speak with whoever is in charge.

    2. Have your supervisor write a letter after you speak with the person in the apartment, which will alert whoever opens the mail, that you are worried over the child’s safety-you are now showing safety concerns and are not attacking their parenting skills or being discriminatory.

    1. If nothing changes and the child is once again outside un- supervised, notify your super- visor who will now contact so- cial services and/or the police. 

    2. If nothing still changes, we will then consider eviction and note the reasoning on their notice. 


    The landlord’s property director said the document is “simply a statement of suggested guidelines for the managers’ reference and discretionary application to unsupervised young children.” However, the court found that the reasoning violates “familial status” rights. The director relied on a mistaken understanding that “young children require regular adult super- vision.” She felt that management should “encourage [...] parents and guardians to exercise such supervision for the safety of their young children and for the benefit of other residents.” She believed that “such supervision is necessary so that young children who are tenant residents “will not be at risk of injuring themselves” or other residents, or “engaging in disruptive or destructive activities.”

    “In an effort to promote such supervision and discourage parent-guardian neglect, we developed internal suggested guidelines for managers to use in their discretion as circumstances might war- rant.”

    3. U.S.Dist.E.D.Ca. April 29, 2016, Decided; May 2, 2016, No. 2:14-cv-01970-KJM-CKD, 2016 U.S. Dist. LEXIS 58280.

     

     

    The guidelines do not pass muster, said the court. While intended to protect the safety and well-being of young children in need of supervision, to encourage parents or guardians to provide that needed supervision, and to limit disturbances to other residents, they also allow differential treatment. It is no help that the guidelines serve the concomitant business purpose of protecting against liability that might arise from injuries to such young children.

    The court found that the landlord’s policies “[...] toward unsupervised young children inherently treats children differently than adults by limiting when they may use the common areas of the complex to times when they are supervised by an adult.” The guidelines also treat parents of young children differently by subjecting them to certain consequences if their children are found unsupervised. Adult-only households may use the complex without limitation and warnings or facing eviction for violating the adult supervision guidelines. Be- cause children are subjected to explicitly differential treatment there was a validly claimed discrimination based on the face of the guide- lines.

    The landlord claimed the guide- lines are not discriminatory: they are not a formalized, mandatory “policy” or rental provision; they only limit young children to the ex- tent the children are unsupervised; they apply only to young children; they have nondiscriminatory justifications; and they originated from a “neutral” source (educational sources). The court replied that the landlord did not understand the law“[...]to establish a prima facie case of facial discrimination, a plaintiff must show only that the defendant subjects a protected group to explicitly differential treatment”4. But the landlord did not dispute that it treated unsupervised young children and their parents differently than adults sans children.

    The guidelines were violations even if just “[l]imiting the use of privileges and facilities [which] is a violation of [§ 3604(b)].” The court also found it irrelevant that the guidelines distilled “neutral” information. The courts have held that “all-age” park rules which: (i) treat kids differently; (ii) are not based on a “compelling business necessity” and (iii) did not represent the “least restrictive intrusions” on familial status rights in promoting a health and safety interest, violate the law.

    Any age restrictive rules which treat children, (and thus, families with children), differently and less favorably than adults-only house- holds violate the law. Period. In other words, no matter how ad- ministered, the rules were invalid as drafted. Even if never enforced, such rules may lead to a resident’s belief about allowable restrictions in use of the facilities. And now, the right to sue extends to internal policies handed down to on site personnel.

    4. Citing Community House, Inc. v. City of Boise (9th Cir. 2007) 490 F.3d 1041 at 1050.

     

     

    Safeguards Against Harm? 

    Well-meant intentions are no defense, said the court. The court noted that the landlord submitted no evidence that managers were told to apply the policy only if a young child’s safety was threatened, or that managers in practice applied the policy in such a way. Land- lord also said, diluting the safety defense, that one of the “primary goals” of the guidelines is to limit disturbances to other residents by children, which “likely encompasses situations beyond those in which a child’s safety is legitimately threatened.” Peace and quiet is not a licit basis for the special treatment of children. Broad exclusionary policies without very particular narrowly tailored terms will be struck down. No cases specify what those narrow, least intrusive regulations might look like. And, it is submitted that seeking to develop children-specific rules is so fraught with difficulty and exposure as not to be worth the time and effort. Again, let the parents and guardians decide.

    Eliminate the Exposure You May Have: 

    Scour on-site management directives, policy handbooks, instructions, procedures manuals, emails. In other words, audit your intermediate level of management documentation; the entire body of memorialized supervision instructions, policies and requirements that apply to on site management. Do your employment agreements contain your fair housing policy? Do your agreements prohibit discriminatory statements, actions, conduct, communications, jokes, or notices? None of these documents is privileged from the prying eye of the plaintiff class counsel. It may be time to update these documents.

    Remember: requiring adult supervision is NOT allowed in all age parks. 

    An adult supervision requirement is outlawed by several decisions citing United States v. Plaza Mo- bile Estates: it is the parents, not management, who act as the “gate- keepers” of the facilities including swimming pool access and usage of facilities in “all age” communities. Requiring any form of super- vision constitutes a violation of the FHAA.

    The FHAA Examples of Improper Rules to Update 

    Rules and regulations in “all age” communities which discriminate include the following. If your rules contain any of the following restrictions, or any rules similar to them, it is strongly advised that a legal advisor conversant with the FHAA (and implementing regulations and judicial and administrative interpretations) be promptly consulted.

    • “Residents and visitors under the age of eighteen (18) years old are not permitted to use the saunas [or] jet pool at any time;” 

    • “Residents and visitors under the age of fourteen (14) years old are not permitted to use the saunas or jet pool (spa) at any time;” 

    • “Use of the spa is prohibited to children under eighteen (18) years old;” 
“Use of the pool by children fourteen (14) years old and un- der requires accompaniment by a resident;” 

    • “Parent of resident child or resident host must accompany 
children at all times in the pool or pool area;”
    • “No one under the age of four-
teen (14) years old is allowed • to use the Jacuzzi;”
    • “Guests and residents under the age of eighteen (18) years
old are permitted to use the swimming pool and sun deck from the hours of 10:00 a.m. to 2:00 p.m. only and must be accompanied by an adult park resident;”
    • “Parent or responsible adult must accompany all children under fourteen (14) years old at all times [in the swimming pool and/or pool area];”
    • “Minors under 16 years old are not permitted in the therapeutic pool;”
    • “At 2:00 p.m. children are to be out of the pool area;”
    • “All children must be accompanied by an adult to use the pool;”
    • Children under the age of fourteen (14) years old shall not be allowed to ride a bicycle on the park streets without the accompaniment of an adult registered to the mobilehome in which they reside;
    • Children under the age of eight (8) years old must be confined to a play area in the rear fenced yard of the family residence;
    • “Children under 18 years old must be accompanied by a parent when they are in the swimming pool;”
    • Children shall not be allowed to play on park streets, or in any other common areas;
    • Residents under the age of eighteen (18) years old shall not be permitted to use the recreation building (clubhouse) or any other recreational facilities without the accompaniment of an adult registered to the mobilehome in which they reside;
    • Residents under the age of eighteen (18) years old must be accompanied by the registered resident adult from the same household in order to use any of the recreational facilities or recreational building (club- house);
    • Residents and visitors under the age of eighteen (18) years old may use the swimming pool and sun deck during the hours of 10:00 a.m. to 12:00 p.m. (noon) every day. Residents and visitors under the age of eighteen (18) years old are not permitted around the pool or sun deck after 12:00 noon;
    • Residents and visitors under the age of eighteen (18) years old are not permitted to use the saunas or the therapeutic jet pool at any time; 

    • Children under the age of four- teen (14) years old must be ac- companied by a registered resident adult to be allowed to ride a bicycle in the park streets; 

    • The adult resident host must accompany all guests of their mobilehome who use the recreation building (clubhouse) or any of the recreational facilities of the park; 

    • Children under the age of fourteen (14) years old must be ac- companied by the registered resident adult from the same household in order to use any of the recreational facilities or recreational building (club- house); 

    • When using the clubhouse, persons under ten (10) years old must be accompanied by an adult resident; use of the billiards room was restricted to residents over eighteen (18) years old; 

    • Use of the spa was prohibited to children under eighteen (18) years old; 

    • Use of the pool by children fourteen (14) years old and under required accompaniment by a resident; 

    • Bicycle riding by anyone is prohibited unless accompanied by adult resident parent or adult host; 

    • Parent of resident child or resident host must accompany children at all times in the pool or pool area;
    • Guests and residents under the age of eighteen (18) years old are permitted to use the swimming pool and sun deck from the hours of 9.00 a.m. to 12 noon only and must be accompanied by the parent or resident child or resident host;
    • No one under the age of eighteen (18) years old is permitted in the billiard room at any time;
    • No one under the age of four- teen (14) years old is allowed to use the Jacuzzi;
    • At 2:00 p.m. children are to be out of the pool area;
    • Children are not to walk around the park without adult supervision;
    • Minors under 16 years old are not permitted in the therapeutic pool;
    • For safety, children are not to ride bicycles, roller skates, skateboards, play in the street, play in RV storage, car wash, or wander around the park;
    • Children under 8 years old shall be confined to a play area in the rear fenced yard of the family residence;

    Age restrictive rules are “facially” discriminatory when they treat children, and thus, families with children, differently and less favor- ably than adults-only households. In other words, no matter how ad- ministered, the rules were invalid as drafted. Even if never enforced, such rules may lead to a resident’s belief about allowable restrictions in use of the facilities.

    The FFHA 

    In 1988, Congress amended the Federal Fair Housing Act (“FFHA”) to prohibit not just discrimination on the basis of race, color, sex, religion, disability or national origin, but also included “familial status” discrimination. “Familial status” is defined as “one or more individuals (who have not attained the age of 18 years) being domiciled with ... a parent or another person having legal custody of such individual or individuals.” Among other provisions, it is unlawful:

    To discriminate against any persons in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith, because of ... familial status ...”

    Thus, in an all-age community, restrictions on access or use of common facilities and amenities based on age of a child (“familial status”) is a violation of the FHAA, absent “compelling business necessity.” 5 Any such rule must be proved to be the “least restrictive means” to achieving a health and safety justification. What does this legalese mean to the parkowner in practical terms? A full blown trial, risks of heavy penalties, damages and attorney’s fees and costs. This is because there is no bright line test for any age-restrictive regulation: the law is bereft of any standards

    or guidance to make a reasonable, predictable risk-assessment or likelihood of success. Each case de- pends on the facts and surrounding circumstances. In other words, each case is a “test-case.” In sum, the penalties are so severe that prudent counsel would admonish all to eliminate age-restrictive rules and regulations.

    “Children” are as protected as any other protected class. Thus, a simple way to test a rule for FHAA compliance is this: insert any other protected class in the place of “children” when testing a rule and regulation. For example, a common past rule (and no longer a valid one) is “all children under 14 years of age must be accompanied by an adult resident when in the pool area.” How does this sound: “All Methodists must be accompanied by an adult resident. . .” Obviously, such a rule would violate the FHAA.

    It is also a violation of the FHAA to express to agents, brokers, employees, prospective sellers, or renters a preference for certain types of ten- ants. Another issue is the use of selective advertisements, or denying information about housing opportunities to particular segments of the housing market because of their race, color, religion, sex, handicap, familial status, or national origin. It is a violation to place ads that specify a preference for: “mature ten- ants,” stating an aversion to “families with children, teenagers in the building; advertisements stating no more than “one child,” or stating that the parkowner does not “rent to children.” “Adult Community” at the entrance to a non-exempt com- munity also violates the FHAA. Use of the word “adult” without in- dicating it is housing for older per- sons, constitutes a violation of the

    FHAA. There are no such things as “adult” mobilehome parks, and use of the phrase is deemed to chill family applicants from applying for tenancy in them.

    The court held that these rules were not based on “compelling business necessity” and did not represent the “least restrictive” intrusions on “familial status” rights in promoting a health and safety interest. Having held that these rules were unlawful, the issues remaining for trial in the Plaza Mobile Estates case included damages, punitive damages, civil penalties, injunctive relief and attorney’s fees and costs for the private plaintiffs. While the action was brought as a class claim (in which all of possibly thousands of affected tenants could have been included in damages awards), class certification efforts were defeated, allowing only the named parties to seek damages.

    The court’s comments regarding the invalidation of these rules is telling and troubling. The court stated that the age restrictive rules were “facially” discriminatory. In other words, no matter how ad- ministered, the rules were invalid as drafted. Even if never enforced such rules might dissuade a prospective applicant from applying for tenancy.

    What Can We Do to Avoid This Mine Field? 

    Even in the absence of specific rules and the ability to craft them, educational materials may help parents understand common risks associated with the very youth. When educational information is provided as an adjunct to an activity rather than a rule restricting an activity, the chance of a claim of discriminatory preference is less likely to be made. For example, when a parkowner offers such educational material from organizations who seek better protection of children (e.g., police departments, charitable organizations, etc.), the parkowner is providing a service - disseminating information and facts - not discriminating against children. 6

    Conclusion 

    All the parkowner wants is to know what the law is! What we do know is that certain rules are not permissible. Does it make any practical sense to promulgate new regula- tions affecting treatment of children? No.

    The best policy for the all-age park is to have no references to children, child, adult, or other words which suggest differential treatment be-tween adults and children. The de- cisions affecting the young are for the parents to decide on.

    Even with neutral rules and regulations, the enforcement of the rules needs to be considered. Does your manager have different attitudes, tone, manner or demeanor in general in dealing with kids and their parents? There is no room for derogatory comments, insults, or force beyond the same level applied to parents and other childless adults. Our mantra: Professional- ism. First and always! ◆

    5. Some cases phrase the test differently (least restrictive, narrowly tailored, not speculative, etc.), but the reader is best advised to apply the standards applicable to the most stringent precedents in effect at this time, until variations on the articulation of the proper test for rules is made judicially and clear through further appellate court development. This is what plaintiff lawyers do. They will make the claim that the rules do not pass muster under the most difficult of possible tests. If you wish to preclude court tests of your rules, they will be drafted based on clearing the highest possible legal hurdles.

    6. For example, educational material exist which explain that young children have peripheral vision which is two-thirds that of an adult; they have difficulty determining the source of sounds; traffic noises and sirens may be confusing; they may not understand that an automobile may seriously hurt or kill them; most children cannot understand a complex chain of events; children believe that all grownups will look out for them; they think that if they can see an adult driving a car toward them, the driver must be able to see them; children often mix fantasy with reality - they may give themselves superhuman powers and do not understand that a moving vehicle can hurt them; they have difficulty judging the speed and distance of oncoming vehicles.

     

    Terry R. Dowdall, Esq. has specialized in manufactured home communities’ law since 1978. Mr. Dowdall can be reached at Dowdall Law Offices, APC Orange County office; 284 North Glassell Street, 1st Floor, Orange, CA 92866; 714.532.2222 phone; 714.532.3238 fax. email: trd@dowdalllaw. net; www.dowdalllaw. com.

    This article is reprinted from WMA "Reporter", July 2016.  MHCO would like to express our deep appreciation to WMA for their permission to reprint this informative article.

     

     

    Phil Querin Q&A: Partial Rent Payment & Allocation to Utilities, Fees etc.

    Phil Querin

    Answer: Be aware that utility charges, late fees, etc. are not “rent.” Rent is the charge for the resident’s right to remain at the space. As you know from the MHCO 72-hour Notice, the right to evict only arises when the rent remains unpaid for seven days following the date of payment, which is usually the first of the month. The extra charges for late fees, utilities, and other expenses the landlord has a right to collect under the rental or lease agreement do not provide the basis for eviction under the 72-hour Notice. A landlord’s right to terminate a tenancy for payment of non-rent charges can be handled in two ways: (a) By issuance of a 30-day notice of termination; or (b) Small Claims Court. If the resident’s payment does not include 100% of the rent that is due, that is a different story. In that case, the landlord does not have to accept partial rent. However, if a landlord is willing to do so, he/she must secure a written agreement. Here’s what ORS 90.417 says: • A landlord may accept a partial payment of rent. • If the acceptance of a partial payment of rent is in accordance with the following protocol, it does not constitute a waiver of the landlord’s right to terminate the tenancy for nonpayment of the balance of the rent owed. • Here is the required protocol: Acceptance of a partial payment of rent waives the right of the landlord to terminate the tenant’s rental agreement for nonpayment of rent unless: o The landlord accepted the partial payment of rent before he/she gave a nonpayment of rent notice based on the tenant’s agreement to pay the balance by a time certain and the tenant does not pay the balance of the rent as agreed; o The landlord’s 72-hour notice must be served no earlier than it would have been permitted under the 72-hour notice statute, had no rent been accepted; and o The notice permits the tenant to avoid termination of the tenancy for nonpayment of rent by paying the balance within 72 hours or 144 hours, as the case may be, or by any date to which the parties agreed, whichever is later; or o The landlord accepted a partial payment of rent after giving a nonpayment of rent termination notice and entered into a written agreement with the tenant that the acceptance does not constitute waiver. The written agreement may provide that the landlord may terminate the rental agreement and file for eviction without serving a new 72-hour notice if the tenant fails to pay the balance of the rent by a time certain. • Note that a landlord and tenant may by written agreement provide that monthly rent can be paid in regular installments of less than a month pursuant to a schedule specified in the agreement. Such installment rent payments are not partial payment of rent under ORS 90.417.

    Bill Miner: Additional Perspective on Oregon Governor's Executive Order 20-12

    In response to the COVID 19 epidemic, Governor Kate Brown joined nearly a dozen other governors on Monday issuing a sweeping order (Executive Order 20-12) that essentially requires people to stay home except for essential travel, such as to the grocery store or for medical needs. Violation of the Order is a Class C misdemeanor, which carries a maximum penalty of 30 days in jail and/or a fine of $1,250.

     

    As of 12:01 a.m. on March 24, a long list of businesses (from amusement parks to youth clubs) were ordered shuttered. Most likely, the list of businesses ordered to close does not affect a manufactured home park, RV park or floating home community; however, community owners should review the list of businesses to ensure compliance.

     

    Although “campgrounds” were ordered closed, RV parks are exempted.

     

    Pools, sports courts and playgrounds must be closed. 

     

    The Governor's order does not change her previous order (Executive Order 20-07) with respect to restaurants, bars, and other establishments that serve food and drink, which Order prohibits on-premises consumption of food or drink but allows take-out or delivery services.

     

    Outdoor Activities

     

    Governor Brown's order specifically allows people to be outside for walking or hiking but any outdoor activity that cannot be done while maintaining social distancing (i.e. basketball) is prohibited. State and community parks may remain open if social distancing can be maintained and signage about social distancing must be prominently displayed.

     

    Employees

     

    Effective March 25, all businesses in Oregon shall facilitate telework and work at home by employees, to the maximum extent possible. Work in offices is prohibited whenever telework and work at home options are available, in light of position duties, availability of teleworking equipment, and network adequacy. In other words, your employees do not have to work from home if their duties require them to be on site (maintenance workers) or if they are not set up to work from home (they don’t have the ability or capability from working from home).

     

    Social Distancing Policy

     

    When telework is unavailable, businesses must designate an employee to establish, implement and enforce social distancing policies, consistent with the guidance from the Oregon Health Authority. Such policies must address how the business or non-profit will maintain social distancing protocols for business-critical visitors.

    Bill Miner | Davis Wright TremaineLLP

    1300 SW Fifth Avenue, Suite 2300 | Portland, OR 97201

    Tel: (503) 778-5477 | Fax: (503) 778-5299 

    Email: billminer@dwt.com| Website: www.dwt.com

     

     

    If you do not yet have a policy in place, you should contact your legal or human resource advisor to assist you with the drafting of a social distancing policy. Please note that DWT is offering a draft policy at a fixed price for MHCO members.

    Phil Querin Q&A: Partial Rent Payments

    Phil Querin

    Question: What are the rules that apply if the landlord agrees to accept rent in an amount less than required under the Rental Agreement?

     

    Answer: This was covered in a December 2016 MHCO Article. The major change in the law since then was due to the elimination of 72-hour notices of nonpayment of rent. Now a 10-day notice must be issued. (MHCO does not have a form for 144-hour notices, but it too has been eliminated. It has been replaced by a 13-day notice.)  For partial payments, MHCO members do have access to "MHCO Form 12: Receipt and Agreement for Partial Payment of Rent" available on-line at MHCO.ORG.

     

    Withour a legal agreement to make specific and timely installment payments, tenants are required to tender to the landlord the full amount of rent owed under the rental or lease agreement no later than the date provided. Without a proper written agreement, the landlord may refuse to accept the tenant’s tender of rent that is for less than the full amount of rent due.[1]

     

    If landlord is willing to accept partial payments, doing so must strictly follow ORS 90.417. If so, the acceptance of a partial payment will not constitute a waiver under ORS 90.412 (Waiver of termination of tenancy) or the landlord’s right to terminate the tenancy for nonpayment of the balance of the rent owed. Notwithstanding any acceptance of a partial payment of rent, the tenant continues to owe the landlord the unpaid balance of the rent.

     

    However, the agreement must be in writing. It must specify the amount and date of the required payments. If the tenant fails to pay the balance due as agreed, landlord may issue a 10-day notice of termination under ORS 90.394 (Termination of tenancy for failure to pay rent). The written agreement should provide that the landlord may terminate the rental agreement and take possession under the eviction statutes (ORS 105.105  to 105.168) without serving a new 10-day notice under ORS 90.394 if the tenant fails to pay the balance of the rent by the agreed-upon time.

     

    However, there are two important rules against giving the landlord rights under the written agreement that are more favorable than already permitted under the law. Specifically:

    • It cannot permit the landlord to issue a termination under ORS 90.394 any sooner than would have been permitted had no rent been accepted; and
    • The notice of termination must permit the tenant to cure it by paying the balance within the time period already allowed under ORS 90.394  (or by any date to which the parties agree, whichever is later.

     

    Note that if the landlord already accepted a partial payment of rent after giving a nonpayment of rent termination notice under ORS 90.394, and then entered into a written agreement for installment payments, doing so will not constitute a waiver.

     

    As always, before entering into a written agreement, landlords should consult with their legal counsel should they have any ques

     

    [1]  Similarly, the landlord is not legally required to accept the tender of a late payment even if it is for the correct amount. However, if the rules or rental agreement provide for a late payment fee, I do not believe the landlord should refuse a late payment tender within the late-fee period. Can the landlord insist on payment of the fee with the tender of the late payment? My concern about doing so is the argument that the “fee” is not “rent.” I would not recommend refusing to accept any late payment unless there was a collateral issue involved, such as waiver – in which legal counsel should be consulted. If rent is tendered after issuance of the 10-day notice but before an eviction is filed, I would still advise my client to accept it. My belief is that once the court learns that rent has been tendered, albeit late, the judge would not likely grant an eviction. My belief is that the “3-strikes” rule under ORS 90.630(10) should suffice for habitual late payers. In all other case, granting some latitude (with collection of a late fee under the rental agreement of rules) should suffice in most cases. Some attorneys may disagree. Legal counsel should always be consulted if there are any questions.

    Phil Querin Q&A: Ground Under Home Settles - Resident Wants Ground Leveled Under Home

    Phil Querin

    Answer: Normally, per the park rules, leveling is a resident responsibility at the commencement of the tenancy. However, here you may have a habitability issue. Here is what the statute says: 90.730 (Landlord duty to maintain rented space, vacant spaces and common areas in habitable condition.) provides: (2) A landlord who rents a space for a manufactured dwelling or floating home shall at all times during the tenancy maintain the rented space, vacant spaces in the facility and the facility common areas in a habitable condition. The landlord does not have a duty to maintain a dwelling or home. A landlord's habitability duty under this section includes only the matters described in subsections (3) to (5) of this section. (3) For purposes of this section, a rented space is considered unhabitable if it substantially lacks: (e) At the time of commencement of the rental agreement, buildings, grounds and appurtenances that are kept in every part safe for normal and reasonably foreseeable uses, clean, sanitary and free from all accumulations of debris, filth, rubbish, garbage, rodents and vermin;" This would seem to suggest that from a habitability standpoint, as long as the pad was in good shape at the commencement of the tenancy, you no longer have any further duty to the resident. I think that conclusion would be a mistake. By your question, it sounds as if your elderly resident is concerned about her water lines. Leveling it could prevent this damage. If the condition of the pad was due to the resident's improper use, that's one thing. But here, it's due to the condition of the ground that you rented to her. She has no right to "fix" the ground as it's not hers to fix. Inasmuch as you own the ground, and the ground is causing the problem, I would suggest that leveling is your responsibility. If the problem was not the result of the ground, I would say it is the resident's responsibility. Look at it this way: If you do nothing, and her water lines break, she will have a damage claim against you. If you level it, that risk is greatly reduced if not eliminated. If you do pay to the have leveling done, make sure that someone checks the water lines under the home, just to make sure they have not been damaged by the cracking in the pad. There is a greater question as to whether the pad itself needs to be fixed. Leveling the home may be just a temporary fix if the problem continues.

    Overview of Rental Agreement

    The renting of spaces by manufactured homes in a manufactured home community is governed by the Oregon Residential Landlord and Tenant Act in Chapter 90 of the Oregon Revised Statutes. The Act requires that a written rental Agreement, Statement of Policy and Rules and Regulations be provided to each tenant renting a space in a manufactured housing community. This agreement, which includes or incorporates the community rules and regulations, becomes the contract that governs the relationship between the landlord and the tenant. Much of what you may or may not be able to do in your community will be addressed in the rental agreement.

    Although many residents in your community may have rental agreements that are 5 or 10 years old, residents moving in to your community must be given a current rental agreement that conforms with the most recent amendments of Residential Landlord and Tenant Act and Federal Fair Housing Act. MHCO form '5A', "Manufactured Dwelling Space Rental Agreement/Dispute Resolution Addendum" (for month to month tenancies) and MHCO form '5B', "Manufactured Dwelling Space Lease Agreement/Dispute Resolution Addendum" are available through MHCO or you may have a rental agreement drafted by your attorney.

    The Oregon Legislature occasionally adopts revisions to the Landlord and Tenant Act. Landlords and managers should make sure that they are utilizing the most current Rental Agreement. Rental Agreements generally may not be changed after execution, with the exception of mutual agreement of the parties; rent increases; and statutory changes (requirements of revised laws will apply even though not stated in the pre-existing agreement). ORS 90.510(4).

    The MHCO Rental Agreement is designed to meet the current requirements of Oregon State Law. The Rental Agreement, which is intended for use in all classifications of parks, can be changed or altered to suit individual situations. In either event, you should consult with your attorney in order to insure that the agreement you choose meets all the legal requirements. It is important to remember that the tenant cannot be required to waive any rights that are granted to the tenant/resident by Oregon State Law.

    The Rental Agreement should be completed and signed by both the landlord and the tenant/resident PRIOR to the home being moved into the community or PRIOR to the tenant/resident occupying a home already sited in the community.