Rent Restriction Case Law

RENTAL RESTRICTION CASE LAW

The following list is by no means exhaustive nor is it necessarily current.

Apple II Condominium Association v. Worth Bank and Trust (1995) 277 Ill.App.3d 345. An association may amend its CC&Rs to prohibit leasing, provided it uses proper procedures to pass the amendment.

Breene v. Plaza Tower Ass'n (1981) 310 N.W.2d 730 732-33. North Dakota case involving prohibition of leasing in both declaration amendment and bylaw.

City of Oceanside v. McKenna (1989) 215 Cal.App.3d 1420. Restrictions on leasing and the requirement imposed on owners to occupy their units are rationally related to the purposes set forth in the CC&Rs.

Colony Hill v. Ghamaty (2006) 143 Cal.App.4th 1156. Associations have the power to limit room rentals as a commercial enterprise.

Hidden Harbor Estates, Inc. v Norman (1975) 309 So.2d 180. Florida case involving CC&R amendment that owners were limited to a single rental during their tenure was valid and was not a reasonable restraint on alienation.

Hill v. Fontaine Condominium Ass'n (1985) 255 Ga. 24, 334 S.E.2d 690. A duly adopted amendment either restricting occupancy or leasing is binding upon condominium unit owners who bought their units before the amendments were effective.

Kroop v. Caravelle Condominium, Inc. (1975) 323 So. 2d 307. Restriction that owners may lease their units only once during their lifetime is valid.

Laguna Royale Owners Ass'n v. Darger (1981) 119 Cal.App.3d 670. As long as rental restrictions are reasonable they will be upheld by the courts. Restrictions are reasonableness if: (i) rationally related to the protection, preservation or proper operation of the property; and (ii) exercised in a fair and nondiscriminatory manner.

McElveen-Hunter v. Fountain Manor Ass'n, 386 S.E.2d 435. North Carolina case involving condominium declaration amendment restricting leasing.

Ritchey v. Villa Nueva Condominium Ass'n (1978) 81 Cal.App.3d 688, 695. Amendment restricting leasing to persons 18 years of age and older was reasonable and was retroactively enforceable against a condominium owner.

Seagate Condominium Association, Inc v Duffy (1976) 330 So.2d 484. Florida case upholding restriction on leasing for investment.

Shorewood West Condominium Ass'n. v. Sadri (1998) 92 Wash.App. 752. Restricting leasing to those units which were already leased is reasonable. However, the restriction must be in the CC&Rs.

Franklin v. Spadafora (1983) 447 N.E.2d 1244. Massachusetts case upholding leasing restrictions that discouraged purchase for investment by limiting to two the number of units that could be owned by one person.

White Egret Condominium, Inc. v. Franklin (1979) 379 So.2d 346. Florida courts upheld rental restrictions as reasonable for the operation and protection of the owners of condominiums.

Woodside Village Condominium Association, Inc. v. Jahren (2002) 806 So.2d 452. Florida courts upheld a leasing restriction that barred owners from leasing during the first 12 months of ownership and limited leasing to not more than nine (9) months in any twelve month period.

Worthinglen Condominium Unit Owners' Ass'n v. Brown (1989) 57 Ohio App. 3d 73. Ohio case involving condominium amendment prohibiting leasing.

Updated by ADAMS KESSLER 8/19/2008