BILL ANALYSIS Ó
SENATE JUDICIARY COMMITTEE
Senator Hannah-Beth Jackson, Chair
2015-2016 Regular Session
SB 419 (McGuire)
Version: April 27, 2015
Hearing Date: May 12, 2015
Fiscal: No
Urgency: No
TH
SUBJECT
Mobilehomes: Homeowners: Sale
DESCRIPTION
Existing law, the Mobilehome Residency Law, regulates the
advertisement, rental, and sale of mobilehomes in a mobilehome
park. This bill would amend the Mobilehome Residency Law to
authorize the seller of a mobilehome to display a "for sale"
sign of a generally accepted yard-arm type design or L-frame
design, would allow for the display of an "open house" sign and
the holding of an open house in accordance with park rules,
would require the management of a mobilehome park, upon request,
to provide in writing the information and standards management
will use to review a prospective homeowner, and would specify
that park management may withhold approval of a prospective
homeowner for reasons based upon fraud, deceit, or concealment
of material facts.
BACKGROUND
Enacted in 1978, the Mobilehome Residency Law (MRL) governs the
relationship between park owners or managers and the residents
of the 4,800+ mobilehome parks and manufactured housing
communities in California. In most of those parks, residents
own their home but lease the land on which their home is
installed. Although they have historically been called
"mobilehomes," it is very difficult to actually move a
mobilehome once it has been installed in a park.
Mobilehome parks generally offer two types of tenancy; the first
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being where the park rents a plot of land and associated
services to the owner of a mobilehome; and the second being
where the park itself owns the mobilehome and rents it to
tenants. For park tenants who own their own mobilehome, the
sale of the home is more complicated than the sale of an
"ordinary" home because the prospective purchaser must also
reach agreement with park management on a tenancy agreement
before purchasing the mobilehome. To prevent park management
from taking unfair advantage of its power to approve new
tenants, the MRL significantly regulates park management's
conduct during a pending sale.
This bill would make minor changes to the MRL as follows:
authorizes sellers to hold an "open house," and clarifies that
a park may establish by rule or regulation reasonable rules
governing how an open house may be conducted, including rules
regarding hours and parking;
authorizes sellers to display L-frame or generally accepted
yard-arm type design signs indicating that a mobilehome is for
sale;
requires the management of the park, upon request, to provide
in writing the information and standards that will be used to
determine if a prospective homeowner will be acceptable as a
homeowner in the park;
specifies that management approval of a prospective homeowner
may be withheld for reasons based upon fraud, deceit, or
concealment of material facts by the prospective purchaser
without liability; and
makes other technical changes to existing law.
CHANGES TO EXISTING LAW
1.Existing law , the Mobilehome Residency Law (MRL), governs the
relationship between park owners or managers and the residents
in mobilehome parks and manufactured housing communities.
(Civ. Code Sec. 798 et seq.)
Existing law provides that a homeowner, an heir, joint tenant,
or personal representative of the estate who gains ownership
of a mobilehome in the mobilehome park through the death of
the owner, or the agent of any such person, may advertise the
sale or exchange of his or her mobilehome, or, if not
prohibited by the terms of an agreement with the management,
may advertise the rental of his or her mobilehome, by
displaying a sign in the window of the mobilehome, or by a
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sign posted on the side of the mobilehome facing the street,
or by a sign in front of the mobilehome facing the street.
Existing law provides that any such person also may display a
sign conforming to these requirements indicating that the
mobilehome is on display for an "open house," unless the park
rules prohibit the display of an open house sign. (Civ. Code
Sec. 798.70.)
This bill would strike the provision allowing a park to
prohibit the display of an open house sign, and would instead
provide that a park may establish by rule or regulation
reasonable rules governing how an open house may be conducted,
including rules regarding hours and parking.
2.Existing law specifies that signs posted in front of a
mobilehome pursuant to the MRL may be of an H-frame or A-frame
design with the sign face perpendicular to, but not extending
into, the street. (Civ. Code Sec. 798.70.)
This bill would provide, in addition to the above, that signs
posted in front of a mobilehome pursuant to the (MRL) may be
of an L-frame or generally accepted yard-arm type design.
3.Existing law specifies that the management of a mobilehome
park shall prohibit neither the listing nor the sale of a
manufactured home or mobilehome within the park by the
homeowner, an heir, joint tenant, or personal representative
of the estate who gains ownership of a manufactured home or
mobilehome in the mobilehome park through the death of the
owner, or the agent of any such person other than the
management. (Civ. Code Sec. 798.71(b).)
This bill would specify that for purposes of the above
section, "listing" includes advertising the address of the
home to the general public.
4.Existing law states that upon request of any prospective
homeowner who proposes to purchase a mobilehome that will
remain in the park, management shall inform that person of the
information management will require in order to determine if
the person will be acceptable as a homeowner in the park.
(Civ. Code Sec. 798.74.)
This bill would provide that a selling homeowner may also
request information pursuant to the section above, that
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management's response to such a request must be in writing,
and, in addition to the information specified above,
management shall also inform the requesting party of the
standards that will be utilized in determining if the person
will be acceptable as a homeowner in the park.
5.Existing law provides that within 15 business days of
receiving all of the information requested from a prospective
homeowner, the management shall notify the seller and the
prospective homeowner, in writing, of either acceptance or
rejection of the application, and the reason if rejected.
Existing law provides that if the approval of a prospective
homeowner is withheld for any reason other than those stated
in the MRL, the management or owner may be held liable for all
damages proximately resulting therefrom.
This bill would state that the approval of a prospective
homeowner may also be withheld for reasons based upon fraud,
deceit, or concealment of material facts by the prospective
purchaser without the management or owner being held liable
for damages proximately resulting therefrom.
This bill would also make technical and conforming changes to
the MRL.
COMMENT
1.Stated need for the bill
The author writes:
Mobilehome and manufactured home owners have an inherent
disadvantage when it comes to selling their home. Unlike
traditional [homeowners], who have the ability to line the
street with for sale signs, mobilehome owners must actively
court additional attention from buyers. The Mobilehome
Residency Law needs to be updated to give sellers a more broad
ability to advertise- both on site and publicly.
Additionally, the process of allowing mobilehome park owners
and management to decide whether the prospective owner has
been cleared for residency in the final phase of a transaction
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lacks transparency and can seem arbitrary to both the seller
and purchaser.
SB 419 will do four things. First, it would modernize
California's Mobilehome Residency Law to allow a seller to
advertise the sale of a home in a manner consistent with
generally accepted yard sign designs, rather than be limited
to only an "A" or "H" frame design. For example, this bill
would allow, but not limit sellers to, an "A", "H", or "L"
shaped sign. Current law already allows these signs to
contain the name, address, and telephone number of the owner
of the mobilehome or his or her agent, so long as the sign
face does not exceed 24 inches in width and 36 inches in
height, and this bill would keep those requirements the same.
Second, this bill would guarantee the seller's ability to
advertise an open house, with appropriate limits. Third, SB
419 would require management to notify the seller in writing
what their standards are and what additional information they
require to accept the new resident into the mobilehome park.
Finally, this bill makes non-substantive clean up changes to
the Mobilehome Residency Law, including clarifying what
constitutes a "listing" . . .
2.Improving Sale Efficiency and Transparency
This bill would make a series of minor changes to the Mobilehome
Residency Law (MRL) regarding the sale and purchase of
mobilehomes in a mobilehome park. As noted in the Background,
the MRL strictly regulates the sale of mobilehomes in an effort
to prevent park management from taking unfair advantage of its
power to approve new tenants. Unlike traditional home sales,
the sale of a mobilehome is often a three-party transaction.
Not only do the buyer and seller have to agree to the terms of
the sale of the home, but mobilehome park management must also
approve the buyer for residency in the park.
Many of the changes proposed in this bill would modernize the
MRL's sale provisions so that they track existing practices for
selling other real property, such as authorizing sellers to hold
an "open house" or display a yard-arm type sign in front of
their property. Additionally, this bill would improve
transparency for both buyers and sellers by requiring park
management, upon request, to disclose the criteria by which new
tenants are deemed acceptable become homeowners in a park. The
Ranch Club Mobile Estates Homeowners Association, in support,
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states that this bill "would increase transparency for both
buyers and sellers regarding park admission standards for new
buyers by requiring the clear disclosure of income and
eligibility requirements."
3.Clarifying Amendment
This bill would provide that upon the request of any selling
homeowner or prospective homeowner who proposes to purchase a
mobilehome that will remain in a mobilehome park, management
shall inform that person, in writing, of the information
management will require and the standards that it will use to
determine if a person will be acceptable as a homeowner in the
park. The author offers the following amendment to clarify that
such a request must also be made in writing.
Author's Amendment :
On page 7, line 31, following "upon" insert: "written"
Support : El Toro Mobile Estates GSMOL Chapter 999; GSMOL
Chapter 708; GSMOL Chapter 1128; GSMOL Homeowners Association,
San Joaquin Village Mobile Home Park; Northern Santa Barbara
County Manufactured Homeowners Team; Oceanside Manufactured
Homeowners Alliance; Orcutt Ranch Home Owners Association;
Prothero Mobile Estates Homeowners' Association; Ranch Club
Mobile Estates Homeowners Association; Sandpiper Homeowner's
Association; Santa Cruz County Manufactured/Mobile Homeowners
Association; Santee Mobilehome Owner's Action Committee; Sonoma
Valley GSMOL; Trico Mobile Estates Homeowners Association;
multiple individuals
Opposition : None Known
HISTORY
Source : Golden State Manufactured Home Owners League (GSMOL)
Related Pending Legislation :
SB 244 (Vidak, 2015) would extend indefinitely the authority of
the management of a mobilehome park to file a motion petition
for an order to enjoin violations of a reasonable rule or
regulation of the mobilehome park within the limited
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jurisdiction of the superior court. This bill is pending
referral in the Assembly Rules Committee.
AB 999 (Daly, 2015) would you authorize the management of a
mobilehome park to sell or dispose of a mobilehome left upon the
premises by a tenant or lienholder under specified
circumstances. This bill would require the landlord, prior to
disposing of the mobilehome, to provide written notice to the
tenant and owner, and would specify that the management of a
mobile home park need not obtain a tax clearance certificate to
dispose of an abandoned mobilehome. This bill is pending in the
Assembly Appropriations Committee.
Prior Legislation :
SB 804 (Leno, Ch. 66, Stats. 2009) prohibited the management of
a mobilehome park from requiring a homeowner to use a specific
broker, dealer, or other person as an agent in the purchase or
installation of a replacement home.
SB 1090 (Dunn, Ch. 567, Stats. 2004) prohibited the management
of a mobilehome park from requiring a homeowner, or an heir,
joint tenant, or personal representative of a mobilehome to use
a specified agent of the management in the sale of the home as a
condition of resale.
AB 2026 (Stone, 2014) would have, among other things required
the management of a mobilehome park to provide a prospective
purchaser with a list of information that management will
require in order to determine if the person will be acceptable
as a homeowner in the park and a copy of the current written
procedures, standards, or requirements that will be used by
management to evaluate the purchaser's application. This bill
would have also required the management, if a prospective
homeowner is denied approval and if requested, to meet with the
purchaser or homeowner at which time the management would be
required to reconsider the denial, including any additional
information relevant to the application provided by the
prospective homeowner. This bill died on the Assembly Floor.
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