Mosser Companies v. San Francisco Rent Stabilization & Arbitration Board

— Mosser Companies (landlord) owns a nine-unit residential apartment building on Fell Street in San Francisco. The apartment is subject to rent control under San Francisco’s Residential Rent Stabilization and Arbitration Ordinance (S.F. Admin. Code, § 37.1 et seq.; ordinance), which limits rent increases to tenants in occupancy {id., § 37.3, subd. (a)). Under Civil Code section 1954.53, which provides that “an owner of residential real property may establish the initial rental rate for a dwelling or unit . . .” (id., subd. (a)), local jurisdictions are authorized to impose rent control limiting rate increases until “the original occupant or occupants who took possession of the dwelling or unit pursuant to the rental agreement with the owner no longer permanently reside there . . .” (id., subd. (d)(2)). The question before us is whether the son of parents who years before rented a unit in landlord’s building, and who with landlord’s consent resided with his parents when the rental agreement was entered, is an “original occupant” within the meaning of the statute, precluding the landlord from establishing a new unrestricted rental rate for the apartment when the son remains…