El Nido Mobile Estates Residents Win Battle Over Massive Rent Hike

El Nido residents wait to hear the fate of their homes.
El Nido residents wait to hear the fate of their homes.
Photo by Courtney Hamilton

Residents of El Nido Mobile Estates in San Juan Capistrano can rest easy--in their homes, too! After a nearly six-month battle between the park residents--all seniors, a number of them low-income--and owner Richard Worley, who informed the residents in May that their space rents would ratchet up to $641 per month starting in September, the City Council voted unanimously to reject the rent increase and implement a more reasonable $37 a month. Worley will have to return rent collected the past two months in excess of the $37 hike--that's over $100,000.

El Nido's residents packed the council chambers to learn their fate, so much so that fire officials interrupted the shebang to move the non-seated crowd to overflow seating in the old city Dance Hall--an aptly-named location, as the seniors grew raucous during the live televised proceedings.

The initial news of the rent hikes had sent many residents into shock--one fainting on the spot, another suffering a minor stroke. Many claimed the hike seemed to violate San Juan Capistrano's Mobile Home Rent Control Ordinance, which maintains that rents can't exceed the average Consumer Price Index (CPI) for the preceding calendar year. Worley's lawyer, Robert Coldren, replied that the rent increase was necessary because Worley was not receiving a market return and the mobile home owners benefited unfairly from low rents while being able to sell their homes in a prime location. In a brief interview with the Weekly, Coldren, a lawyer and developer with Pacific Current Partners, argued that the market is not constituted by comparable mobile home rents in the area.

Yesterday's decision for the tenants came in the final of a series of meetings, spurred by 90 percent of the park's residents signing a petition against the hike and filing it with the city back in June. The City Council reinstated the previously-defunct Housing Advisory Committee and hired a third party hearing officer, Michael Roush. At issue was whether the $641 hike exceeded the maximum rent increase allowed by the city ordinance--"the most obvious, no-brainer of all questions," the residents' lawyer, Bruce Stanton, scoffed during today's proceedings. In a 25-page report, Roush concurred, declaring that the rent hike was unnecessary for Worley to receive a market return on his property within the confines of San Juan Capistrano's municipal code.

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City staff agreed, recommending the City Council quash the hike in favor of a $37 monthly increase and order Worley to return rent collected in excess. Prior to the decision, most residents had paid two months of the hiked rent, some of them relying on the kindness of their fellow residents and funds raised through GoFundMe--though over 40 of them had been served with termination notices because they could not afford to pay. Those residents now consider the notices void in light of today's decision.

Coldren had resorted to theatrical antics through the series of meetings, alternating between straw-man arguments and lambasting the City Council. In the previous meeting, he argued that the Housing Advisory Committee harbored a personal prejudice against him due to comments on the City's municipal code made by Councilmembers Sam Allevato and Kerry Ferguson. The two councilmembers recused themselves from the proceedings, with the city attorney stating at the meeting, "The councilmembers don't believe the statements rise to the level of bias, but out of an abundance of caution, they have recused themselves."

Coldren, in concert with Worley's additional lawyers from firm Callahan and Blaine, also insisted that that the City Council failed to follow hearing procedures in accordance with the Brown Act. Callahan and Blaine filed a series of appeals with the City decrying administrative failures; the city denied their appeal.

For a grand finale yesterday, Coldren gave residents one more aria. He repeatedly complained about his allotted speaking time, noting the issue "was worth millions of dollars for my client and of tremendous importance to the residents." The dance hall crowd scoffed in response.

At one point Coldren asked if his "30 seconds had run out."

"Yes, 20 seconds ago," San Juan Capistrano Mayor Derek Reeve replied, leading to thunderous applause in the dance hall, although the mayor harshed the party by announcing he would "not tolerate applause in this quasi-judicial hearing."

In another exchange, Coldren asked for more time. "I've given both attorneys more time than the United States Supreme Court would," Reeve said coolly. Coldren ended up so frazzled that at one point, he referred to San Juan Capistrano as the northern San Diego Couny city of San Marcos, then blamed the City Council for "throwing him off his game."

"I can't say anything in five minutes that will change your mind ... I'm not even going to try," Coldren concluded, before ending with a threat: "Do the fair thing so we don't end up in court tomorrow."

While the residents feel vindicated, they suspect Worley and his team of lawyers will attempt to fight the decision in Orange County Superior Court in the next few days. After all, that's what Coldren promised. "A court battle will ensue unless my client is treated with a modicum of fairness," he told the council. "It won't end here, or even in the court battle, because my client has a constitutional right to bring this issue before City Council every year."

Email: garellano@ocweekly.com. Twitter: @gustavoarellano.

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