Unilateral Amendments to Community Rental and Lease Agreements Recent Oregon Court of Appeals Case

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November 4, 2018
Phil Querin
MHCO Legal Counsel
Unilateral Agreements

 

ORS 90.510(4) provides:

Every landlord who rents a space for a manufactured dwelling or floating home shall provide a written rental agreement, except as provided by ORS 90.710 (Causes of action)(2)(d). The agreement must be signed by the landlord and tenant and may not be unilaterally amended by one of the parties to the contract except by:

 

  1. Mutual agreement of the parties;

 

  1. Actions taken pursuant to ORS 90.530 (Pets in facilities)90.533 (Conversion of billing method for garbage collection and disposal)90.537 (Conversion of billing method for utility or service charges)90.543 (Utility or service charge billing for large manufactured dwelling parks) (3), 90.600 (Increases in rent)90.725 (Landlord or agent access to rented space) (3)(f) and (7) or 90.727 (Maintenance of trees in rented spaces); or

 

  1. Those provisions required by changes in statute or ordinance. (Emphasis added.)

 

In a recent Oregon Court of Appeals case, the full impact of these “unilateral” amendment provisions became the subject of scrutiny that (unless appealed and overturned by the Oregon Supreme Court) should serve as a cautionary warning for park owners and managers.

                                                                                                                                         

Historically, it has been common knowledge that once signed by the landlord and tenant, a rental/lease agreement may not be amended unless all parties agree. However, over the years, as landlord-tenant legislation began to detail more and more rights and liabilities, the issue arose as to how changes in the law were to be applied, when they did not appear in the rental/lease agreement.  

 

In summary, ORS 90.510(4) provides that a park rental or lease agreement may not be unilaterally amended except under the following circumstances:

 

a)   Both parties agree; or

b)   Certain specific statutes specifically allowunilateral amendment; or 

c)   Certain specific statutes automatically requirethat the rental/lease agreement is changed.

 

In the case of subsection (4)(b), ORS 90.510 specifically lists those statutes which allow a landlord to unilaterally impose a change in the rental/lease agreement. A common example is the submetering statutes. When they first came into effect, many – if not most – agreements did not specifically address the multiplicity of  issues that would be effected, from removing certain utilities from base rent, to direct billing, to accessing a space to install and read the meters.

 

In the recent Court of Appeals case of Morat v.Sunset Village, LLC, the focus was on how ORS 90.510(4)(b) should be interpreted. The Court explained the issue in the opening of its opinion:

 

This case involves a conflict between a tenant and landlordaboutwhopaysthecostresultingfromafallentree in a manufactured dwelling park. At issue are a statute on trees in rented spaces (ORS 90.727), a statute on “unilateral amendment” of a rental agreement (ORS 90.510(4)), the terms of the parties’ lease, and the trial court’s award of attorney fees incurred in court-annexed arbitration. [1]

 

The Court found in favor of the plaintiff-tenant. Setting aside the fact that in trial, the tenant put on evidence that the prior landlord had always cleaned up tree limbs that littered spaces after a storm, the main issue was fairly straight forward: Does the unilateral amendment language of ORS 90.510(b) require the landlord to actually amend the rental/lease agreement (as argued by the tenant),or is it automatic under subsection (4)(c) which provides that “(c)ertain specific statutes automatically require that the rental/lease agreement is changed” (as argued by the landlord).[2]

 

The Court held that although ORS 90.510(4)(b) explicitly allows landlords to unilaterally amend the rental/lease agreements to allocate responsibility, the enumerated statutes (including hazard tree statute) are not automatically effective.  That is, the rental/lease agreement actually has to be unilaterally amended.  In other words, contrary to the position taken by the park owner in the above case, in order to gain the benefit of allocating responsibility between landlords and tenants for trees on a space, management was first required to affirmatively “unilaterally amend” the rental/lease agreement.

 

Although the Court did not get into specifics as how this is done, it is not difficult to comply, e.g.  send to each tenant a single page amendment, stating that pursuant to ORS 90.510(4)(b), their rental/lease agreement is “…hereby amended to adopt ORS 90.727 Maintenance of Trees in Rented Spaces).”  Either the statute should be quoted verbatim, or a copy attached to the unilateral amendment.  And of course, the amendment should be included in each tenant’s file.

 

So the take-away for MHP landlords is that if you want the protection/enforcement provisions of the following statutes (and your current rental/lease agreement does not already contain them), you should make a unilateral amendment:

·     ORS 90.530 (Pets in facilities)

·     ORS 90.533 (Conversion of billing method for garbage collection and disposal);

·     ORS 90.537 (Conversion of billing method for utility or service charges); 

 

·     ORS 90.543 (Utility or service charge billing for large manufactured dwelling parks);

·     90.600 (Increases in rent);

·     90.725 (Landlord or agent access to rented space); and

·     90.727 (Maintenance of trees in rented spaces).

 

At the end of MHCO’s rental and lease agreements, the following provision appears, which should serve as a prompt for all landlords to issue a unilateral amendment document to tenants when (a) permitted by Oregon law, and (b) the provision is not already contained in the rental/lease agreement:

 

TENANT understands and agrees that in the event of any changes in local, State or Federal laws affecting the parties’ rights or remedies herein, LANDLORD, in LANDLORD’S sole discretion, may request that TENANT sign one or more written addenda expressly incorporating such changes into this Agreement. TENANT’S failure to sign such written addenda within ten (10) days of LANDLORD'S written request to do so shall constitute a breach of this Agreement. No such change shall be retroactively applied to any circumstance that occurred prior to the date such new law became effective. Notwithstanding the preceding, LANDLORD shall have no duty to amend, alter or adjust this Agreement due to any laws or ordinances enacted after the Commencement Date, regarding Rent, Rent control, Rent adjustment, or any other limitation, restriction or provision affecting or limiting the amount of Rent LANDLORD may charge for this Space. TENANT(S) Initials):  _______ _______ 

 

It appears the rental or lease agreement at issue in the above-referenced case did not contain such a reminder.

 

 

 

 

 

 


[1]The following discussion does not address whether ORS 90.727 applies to fallen trees.

[2]Query: If subsection (c) automaticallyapplied to trees on tenant spaces, why was subsection (b) necessary? In other words, it would seem that (b) would not need to have been included in ORS 90.510(4). 

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