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October 19, 1999

October 19, 1999B>

 

 

 

MINUTES OF THE REGULAR MEETING OF
THE SAN FRANCISCO RESIDENTIAL RENT
STABILIZATION & ARBITRATION BOARD,

Tuesday, October 19, 1999 at 6:00 p.m. at
25 Van Ness Avenue, Suite 70, Lower Level

I. Call to Order

President Wasserman called the meeting to order at 6:10 p.m.

II. Roll Call

Commissioners Present: Becker; Bierly; Gruber; Hobson; Marshall; Wasserman.

Commissioners not Present: Lightner; Mosser.

Staff Present: Grubb; Wolf.

Commissioner Murphy appeared on the record at 6:16 p.m.; Commissioner Justman arrived at the meeting at 7:55 p.m.

III. Approval of the Minutes

MSC: To approve the Minutes of September 27th and October 5th, 1999. (Becker/Marshall: 4-0)

IV. Remarks from the Public

Fred Heller, the landlord in the case at 1165 Bay St #12 (U001-33R), informed the Commissioners that he was in attendance.

V. Old Business

A. Costa Hawkins

Deputy City Attorney Marie Blits appeared to discuss Senate Bill 1098, which amended the Costa Hawkins Rental Housing Act (California Civil Code Sections 1954.40, et seq.). This recently enacted legislation amends existing Civil Code Section 1954.53 and adds Section 1954.535, resulting in certain rent control provisions for Section 8 units coming under rent control; and revision/clarification of the provisions exempting units with long-term health and safety code violations from Costa-Hawkins. Ms. Blits recommended mirroring the language of SB 1098 pertaining to Section 8 units in our Ordinance; she will draft such amendments for the Board’s approval and forwarding to the Board of Supervisors. However, the Board’s original package of suggested Costa-Hawkins amendments to the Rent Ordinance did not include the original health and safety code violation language in Costa-Hawkins because this would effectuate vacancy control. Ms. Blits agreed to draft amendments including the new language for discussion at the Board’s Special Legislative Session on November 16th.

B. Rules and Regulations Section 6.15 (Leno Legislation)

Commissioner Marshall distributed a re-draft of Rules Section 6.15 which would conform the procedures for obtaining a replacement roommate in the event of an absolute prohibition against subletting with those contained in Rules Section 6.15, in accordance with recent legislation sponsored by Supervisor Leno and approved by the Board of Supervisors. Commissioner Marshall’s re-draft separates and makes clear which provisions of Section 6.15 apply to situations where there is an absolute prohibition and which apply to situations where there is not. This issue will be discussed further at the Special Legislative Session on November 16th.

C. Rules and Regulations Section 6.14

Senior Hearing Officer Tim Lee appeared to discuss a Memorandum he prepared at Commissioner Murphy’s request, analyzing the provisions of Costa-Hawkins as they relate to Rules Section 6.14. Specifically, since the right to a market rent increase under Costa-Hawkins applies only to a post-January 1, 1996 "sublessee or assignee", Mr. Lee’s Memorandum sets forth his research into and understanding of the distinctions between "tenants", "sublessees" and "assignees." Mr. Lee also attached a proposed amended 6.14 that he believes comports with the requirements of Costa-Hawkins. Further discussion of this issue was continued to the November 16th Special Legislative Session.

VI. Consideration of Appeals

A. 890 Page St. #4 & #6 U001-34 & -36R

The landlord’s petition for certification of capital improvement costs to five of six units was granted. Upon appeal from the landlord, the case was remanded only on the issues of the proper base rent for the tenant in unit #3 and to determine the applicability of the 6-Month Rule to the tenant in unit #4. In the Decision on Remand, the Hearing Officer determined that the 6-Month Rule was inapplicable to the tenant in unit #4 because ownership had changed during the relevant 6-month period, and the new owner commenced the work but had not had an opportunity to set the rent for the unit. The tenant in unit #6 now appeals the remand decision, although he did not appeal the original decision and neither of the issues on remand pertain to his unit, alleging that no changes have been made to his apartment and that his portion of the common area does not look like everyone else’s. The tenant in unit #4 contests the reversal of the Hearing Officer’s determination of the 6-Month Rule’s applicability to his tenancy.

MSC: To deny the appeal of the tenant in unit #6.

(Gruber/Murphy: 5-0)

MSC: To deny the appeal of the tenant in unit #4.

(Gruber/Murphy: 5-0)

B. 1165 Bay St. #12 U001-33R

The landlord’s petition requesting a determination as to whether the landlord is entitled to a rent increase pursuant to Rules and Regulations Section 6.14 was granted, and an increase in rent from $1,210.05 to $2,200.00 was found to be warranted under the facts of this case. On appeal, the tenant claims that the landlord’s handyman, who knew of her presence in the building, had apparent authority to act as the landlord’s agent, and represented himself as such; and, since she was not served with a notice pursuant to Rules and Regulations Section 6.14 within 60 days of the agent’s knowledge of her presence in the building, the proposed increase is unlawful.

MSC: To deny the appeal. (Gruber/Murphy: 4-1; Becker dissenting)

C. 2386 Fulton St. U001-24A

The tenants’ petition alleging substantial decreases in housing services was granted and the landlords were found liable to the tenants in the amount of $572.00 for inadequate bathroom facilities and $1,155.00 for loss of the right to sublet without written permission. The landlords appeal, claiming that: the issue of the unlawful rent increase was not properly before the hearing officer and resulted from all of the original tenants on the lease having vacated the unit; the landlords never withheld the tenants’ right to sublet but, rather, insisted that the tenants obtain consent to a replacement roommate prior to that person moving in to the unit; the hearing officer erred in determining that the tenants had requested a change in roommates no more than once within the previous 12 months, pursuant to Rules Section 6.15; it is not true that the tenant works at home and she therefore was not seriously inconvenienced during a period of construction; the tenants’ bathroom facilities were impacted for a significantly shorter period of time than that found by the hearing officer; and the project took longer than anticipated due to unreasonable restrictions placed on access by the tenants.

MSC: To accept the appeal and remand the case to the hearing officer to find that enforcing a consent clause in a rental agreement does not constitute a decrease in housing services; to grant a rent reduction only for the period of time that consent to subletting was unreasonably withheld by the landlord; and to determine whether the rent increase was the result of all of the original occupants having vacated the unit.

(Marshall/Becker: 5-0)

VII. Board Hearing

1935 Franklin St. #503 T001-70A

(acpt. 8/3/99)

The tenants’ petition alleging an unlawful rent increase from $930 to $1,650.00 per month was granted. The tenants had switched apartments with the tenants in another unit in the building and created an assignment of the tenancies at the same rent with the consent of the prior resident manager of the building. Therefore, the hearing officer found the tenants to be "original tenants" within the meaning of Rules and Regulations Section 6.14. On appeal, the landlord asserted that: pursuant to the provisions of Civil Code Section 1954.53 (Costa-Hawkins), the landlord had the right to increase the rent because the tenants did not occupy the rental unit prior to January 1, 1996; a landlord’s knowledge or consent to an occupancy is not consent to a rent level as the issues are separate and distinct and the tenants cannot assign a statutory right held by the owner; the tenants in this case engaged in a concerted effort to obtain a larger apartment without having to pay market rent for the unit; and the hearing officer failed to make the tenants meet their burden of proving the rent increase to be unlawful but, rather, put the onus on the landlord to prove that the increase was lawful. At the meeting on August 3, 1999, the Board voted to accept the appeal and schedule a Board hearing on the issues of the apparent authority of the agent and waiver pursuant to Costa-Hawkins.

The appeal hearing commenced at 7:50 pm. and concluded at 10:55 p.m. In appearance were tenants Barbara Brown and Dahmane Djermouli, and their counsel, Jonathan McCurdy. The landlord was represented by Merrie Turner Lightner and Attorneys Nancy Lenvin and Anthony Head, and appeared with witnesses Arthur T. Swanson, Jr., Abigail Glynn, William Lightner, Jr., and Jack B. Sumski. Prior to commencement of the hearing, Nancy Lenvin requested that the caption on the appeal decision reflect that the landlord in this case is "Profita Holding NV", and not Lightner Property Group, which is the asset manager for the landlord. Also prior to commencement of the hearing, the Board passed the following motion:

MSC: To recuse Commissioner Becker from consideration of this case. (Marshall/Wasserman: 5-0)

Testimony at the hearing focused on the circumstances surrounding the assignment of the subject unit, and the authority of the prior resident manager to agree to such a swap. After discussion and consideration of the relevant evidence, the Board agreed that, although it seems that the prior resident manager should not have consented to the exchange of units since his authority to do so had apparently been revoked, he still had apparent authority sufficient for the tenants to rely upon. Additionally, since the agent for the landlord with ostensible authority received notice in writing of the assignment and thereafter accepted rent, the rent increase is not allowed pursuant to Costa-Hawkins (Civil Code Section 1954.53). Therefore, the Board passed the following motion:

MSC: To deny the appeal. (Marshall/Hobson: 3-2; Gruber, Murphy dissenting)

VI. Appeal Considerations (cont.)

D. 790 Church St. #105 U001-23A

The tenant’s petition alleging a substantial reduction in housing services due to the loss of use of a deck for 9-1/2 months was granted and the landlord was found liable to the tenant in the amount of $1,634.00. On appeal, the landlord asserts: that the base rent amount used for ascribing a percentage value to the lost service should not include a $100 charge for parking; that the time period for the rent reduction should be reduced by 60 days, which is a reasonable time for the landlord to have effectuated the repairs; and that the housing service has been mis-characterized as a deck, when it is really a patio, and which the tenant retained the use of, in part.

MSC: To deny the appeal. (Marshall/Becker: 5-0)

E. 58 Malta Dr. U001-21A

The tenant’s petition alleging an unlawful increase in rent was granted and the landlord was found liable to the tenant in the amount of $1,150.00. On appeal, the landlord claims that the rent increase was justified because a new lease agreement was entered into; that he should not be punished for allowing the tenants to obtain replacement roommates; the amount of rent paid by the replacement roommate was not known to the landlord nor within his control; that there is a mathematical error in the overpayment calculation; and the amount owing should be offset by increases that the landlord would have been entitled to.

MSC: To accept the appeal and remand the case to the hearing officer to make a mathematical correction and to determine whether the outcome of this case is affected by Costa-Hawkins; a hearing will be held only if necessary.

(Murphy/Marshall: 5-0)

F. 926 Grove St. U001-20A

The tenant’s petition alleging an unlawful rent increase based on an increase in the garage parking charge was granted and the landlord was found liable to the tenant in the amount of $225.00. Additionally, decreased service claims due to a clogged bathroom sink and constantly running toilet were granted in the amounts of $150.00 and $100.00 respectively. On appeal, the landlord asserts that: a commercial lease was entered into for rental of the parking space, which is not under the jurisdiction of the Rent Board; the person entering into the agreement for the parking space on behalf of the landlord had no authority to do so; the tenant failed to give proper notice of the need for repairs; the problem with the sink was caused by the tenant and was therefore her responsibility to repair; and the amount granted is disproportionate to the extent of the problems.

MSC: To accept the appeal and remand the case to the hearing officer to determine whether the parking lot is on a parcel separately alienable from the property and whether the rental of the parking space is commercial or residential. (Becker/Marshall: 5-0)

G. 241 Upper Terrace U001-22A

The landlord’s petition for certification of capital improvement costs to four of five units was granted, in part. On appeal, the landlord objects to the hearing officer’s allocation of costs, claiming that: the reduction of 25% of the costs for inaccessible areas is unfair because it is not true that these areas are off-limits to the tenants; the Golden Gateway decision holds that no decrease in housing services occurs during reasonably necessary repair and maintenance work; the basement office is used for operation of the building, which benefits the tenants, and therefore no percentage of the costs should be allocated to the office space; if the office must share in the allocation, it should be done on a square footage basis; and the deck that the tenants are not allowed to use comprises only 8.6% of the total square footage, and not 20%.

MSC: To accept the appeal and remand the case to the hearing officer on the issue of the proper allocation of the costs for the rear decks; a hearing will be held only if necessary. (Becker/Gruber: 5-0)

VII. Communications

In addition to correspondence concerning cases on the calendar, the Commissioners received a copy of legislation introduced by Supervisor Becerril in conjunction with the Office of the District Attorney to strengthen civil and criminal penalties for violations of the Rent Ordinance.

VIII. Calendar Items

October 26, 1999 - NO MEETING

November 2, 1999 - NO MEETING (Election Day)

November 9, 1999

8 appeal considerations

Old Business:

A. Ellis Amendments

B. Rules and Regs. Section 6.15 (Leno Legislation)

C. Rules and Regs. Section 6.14

IX. Adjournment

President Wasserman adjourned the meeting at 11:40 p.m.

Last updated: 10/9/2009 11:26:14 AM