SANTA MONICA—On Tuesday, July 30, the California Court of Appeals ordered two properties at 1041 20th Street and 1915 Ocean Avenue to abide by the Santa Monica Rent Control Board and convert the units back to rent control.
The property located at 1041 20th Street LLC, houses 13 residential units, while the 20th Street property, and ASN Santa Monica, LLC, owns the 70 residential units inside the Ocean Avenue building, filed petitions for the court to review and reverse the decision of the Santa Monica Rent Control Board that mandated the properties return to rent control, the Santa Monica Daily Press first reported.
A trial court granted the petitions and allowed 1041 20th Street LLC’s request for declaratory relief, the Court of Appeals ruled that the trial court had errored and reversed its decision.
In 1979, the Santa Monica Rent Control Board was created in the city of Santa Monica to regulate rentals, and prevent unreasonable rent increases for tenants. In 1993, the owner of 20th Street building filed an application for a Category C removal permit, which is defined by the Santa Monica Rent Control Board as a permit for landlords who prove a controlled rental until it is uninhabitable and cannot be made habitable in an economically feasible manner.
A hearing was held in 1993 and the board discussed the findings of the property inspector. The inspector concluded the rental was uninhabitable and the cost of repairs would cost too much. The property was exempted from the Rent Control law and did not need to register for the Santa Monica Rent Control Board.
In 2016, the Santa Monica Rent Control Board sent a letter to both owners stating that since the units were not demolished or converted they were now subject to the rent control law. On March 20, 2017, the owners of both buildings filed petitions that the Rent Control Board’s current interpretation of the rent control law was incorrect since it previously received removal permits. In the past, removal permits permitted landlords to remove a rent controlled unit.
The California Court of Appeals disagreed that the board was revoking the removal permits stating:
“As the Board concedes, the removal permits remain valid and the owners can thus remove the rental units from the rental housing market by demolition, conversion or other means. Rather, the Board, in 2016, changed its interpretation of section 1803(t) to conclude, correctly, that a removal permit did not exempt a rental unit from rent control.”
The court also mandated that the Santa Monica Rent Control Board, an administrative agency, had the authority to reconsider a prior decision and is not bound by the previous interpretation that a removal permit allowed a landlord to remove a unit from rent control.
In 2018, the trial court ordered the Santa Monica Rent Control Board to reverse and grant excessive rent complaints. The Rent Control Board argued that the court made a mistake
Written By Maydeen Merino and Alexandra White