Gene Cashman and Athena Sutsos v. City of Cotati, a Municipal Corporation

374 F.3d 887, 2004 U.S. App. LEXIS 14603, 2004 WL 1575238
CourtCourt of Appeals for the Ninth Circuit
DecidedJuly 15, 2004
Docket03-15066
StatusPublished
Cited by9 cases

This text of 374 F.3d 887 (Gene Cashman and Athena Sutsos v. City of Cotati, a Municipal Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gene Cashman and Athena Sutsos v. City of Cotati, a Municipal Corporation, 374 F.3d 887, 2004 U.S. App. LEXIS 14603, 2004 WL 1575238 (9th Cir. 2004).

Opinions

BEEZER, Circuit Judge.

Appellants Gene Cashman and Athena Sutsos, both mobilehome park owners, allege that the rent control ordinance adopted by appellee City of Cotati, California (“the City”) effects a regulatory taking in violation of the Fifth and Fourteenth Amendments to the United States Constitution. After granting their motion for summary judgment and entering judgment, the district court amended then vacated that judgment pursuant to Federal Rules of Civil Procedure 59(e) and 60(b), respectively. The district court conducted a trial and entered judgment for the City. Cashman and Sutsos appeal the district court’s orders amending and vacating the original judgment, as well as its findings and conclusions following trial.

[890]*890We vacate the post-trial judgment and remand to the district court for reinstatement of the original judgment in favor of Cashman and Sutsos.

I

On September 23, 1998, the City-adopted Ordinance No. 680, entitled the Mobilehome Park Space Rent Stabilization Program (“Ordinance No. 680” or “the Ordinance”). The City adopted Ordinance No. 680 in anticipation of the repeal of its then-governing rent control ordinance, Chapter 19.12, adopted in 1979 (“the 1979 Ordinance”).1 The operative provisions of Ordinance No. 680 limit the annual rental increases mobilehome park owners can charge to the lesser of 6% or the percentage change in the Consumer Price Index (CPI). Proposed increases exceeding this amount are subject to administrative review. Unlike the 1979 Ordinance, Ordinance No. 680 contains an explicit provision regarding vacancy control.2 Vacancy control prevents mobilehome park owners from charging a new base rent or increasing the existing rent for a mobilehome space when ownership of a mobilehome coach is transferred and the coach remains in place.

The stated purpose of Ordinance No. 680 is to “stabilize the rate of mobilehome park rental rates.” According to the Ordinance, the stabilization of rental rates will accomplish the following:

(1) prevent exploitation of the shortage of vacant mobilehome park spaces;
(2) prevent excessive and unreasonable mobilehome park space rent increases;
(3) rectify the disparity of bargaining power which exists between mobile-home park residents and mobile-home park owners;
(4) provide mobilehome park owners with a guaranteed rate of annual space rent increase which accurately reflects the rate of inflation and increases in their expenses; and
(5) provide a process for ensuring mobi-lehome park owners a fair, just and reasonable rate of return on their parks in cases where the guaranteed annual space rent increase provided by this chapter proves insufficient;
[891]*891(6) provide continued rent control through the transfer of a mobile-home-on-site (i.e., on the mobilehome pad) to a new mobilehome owner to prevent exploitative rental increases which take place when vacancy decontrol is either in effect or prac-tised by park owners.
(7) provide options in the duration of tenancies to prospective mobilehome tenants to prevent oppressive adhesion contracts from being imposed upon new park tenants.

The district court concluded that Ordinance No. 680 has the additional purpose of providing and maintaining affordable housing to lower income and elderly residents.

Ordinance No. 680 also contains several legislative findings of fact in support of its adoption. These findings describe the mo-bilehome market in Cotati, including the 0% vacancy rate among mobilehome park spaces; the older and lower income demographic common among mobilehome owners; the high costs associated with relocating a mobilehome; and the success of the 1979 rent stabilization ordinance. There is also a finding that “[s]ince the adoption of the 1979 rent stabilization ordinance, the City has construed its provisions as requiring vacancy control: that is, upon the tenant’s vacating of a rental unit or space, his/her successor tenant is entitled to the same rent previously charged to the vacating tenant.”

Cashman and Sutsos own mobilehome parks in Cotati that are subject to Ordinance No. 680. They bring the instant action alleging, inter alia, that Ordinance No. 680 constitutes a facially unconstitutional regulatory taking because it does not substantially advance the City’s interests as they are described in the Ordinance. Specifically, Cashman and Sutsos claim that Ordinance No. 680 permits a tenant to capture a premium upon the sale of his/her mobilehome coach that corresponds to the increased value of the coach attributable to rent control. This premium, they argue, keeps the costs for incoming tenants the same and, therefore, prevents the Ordinance from substantially advancing the City’s interests, including increasing affordable housing. They seek injunctive and declaratory relief.3

The district court initially granted Cash-man’s and Sutsos’s motion for summary judgment. Relying largely on our decision in Richardson v. City and County of Honolulu, 124 F.3d 1150 (9th Cir.1997), the court declares “the Ordinance to be an unconstitutional regulatory taking in violation of the Takings Clause of the Fifth Amendment,” and enters judgment. The district court subsequently grants the City’s motion to amend the judgment pursuant to Rule 59(c), holding that only the Ordinance’s vacancy control provision is unconstitutional, not the entire Ordinance.

The City appealed the grant of summary judgment; Cashman and Sutsos cross-appealed regarding the district court’s decision to amend the judgment.

While these appeals were pending we filed an opinion in Chevron USA, Inc. v. Cayetano, 224 F.3d 1030 (9th Cir.2000) (“Chevron I”). In response to the City’s Rule 60(b) motion, the district court requested that we remand the case so that it could consider whether its earlier interpretation of Richardson was erroneous in light of Chevron I and whether to grant [892]*892relief from the amended judgment.4 We remanded the case to the district court, which, in turn, vacated its amended judgment and proceeded to trial. Cashman and Sutsos appealed. We dismissed their appeal. We also dismissed the other pending appeals as moot.

The district court conducted a five-day bench trial5 in the course of which it heard testimony from both parties’s expert witnesses. The trial court concludes that Cashman and Sutsos failed to show that Ordinance No. 680 creates or is likely to create a premium in connection with the resale of mobilehome coaches and that even if a premium did exist, Cashman and Sutsos did not establish that it would interfere with the stated purposes of the Ordinance.

II

In its findings of fact and conclusions of law following trial, the district court concludes that Cashman’s and Sutsos’s claims are barred by the statute of limitations. The district court says that because Ordinance No.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Guggenheim v. City of Goleta
638 F.3d 1111 (Ninth Circuit, 2010)
Mushrush v. Martel Construction, Inc.
235 F. App'x 552 (Ninth Circuit, 2007)
Fredericks v. Village of Kykotsmovi
6 Am. Tribal Law 393 (Hopi Appellate Court, 2005)

Cite This Page — Counsel Stack

Bluebook (online)
374 F.3d 887, 2004 U.S. App. LEXIS 14603, 2004 WL 1575238, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gene-cashman-and-athena-sutsos-v-city-of-cotati-a-municipal-corporation-ca9-2004.