City of West Hollywood v. 1112 Investment Co.

Introduction

This appeal involves application of the rent control ordinance enacted by the City of West Hollywood (City). The pertinent facts are undisputed and were presented to the trial court in the form of a stipulation. The legal dispute is whether two apartment buildings owned by respondents are subject to City’s rent control law.

Prior to City’s incorporation in 1984, respondent owners had received all required state approvals to convert their two buildings into condominiums. In City of West Hollywood v. Beverly Towers, Inc. (1991) 52 Cal.3d 1184 [ 278 Cal.Rptr. 375 , 805 P.2d 329 ] (Beverly Towers), a majority of our state Supreme Court held City could not apply a subsequently enacted ordinance requiring apartment owners to obtain a conditional use permit for a condominium conversion when the owners had all obtained necessary state permits prior to City’s incorporation. Here respondent owners never sold any units as condominiums but instead continued to use the buildings as apartment rentals. Each respondent owner also allowed one of the necessary state approvals for conversion it had obtained—a public report from the Department of Real Estate (Department)—to…