Utility Charge Case - Rehearing Results by Michael A. Parham, Attorney

An earlier article I wrote dealt with a utility charge case for which the AAMHO newsletter printed an Administrative law Judge decision. In that case, the Judge determined that the mobile home park had overcharged for trash removal service by not permitting tenants to suspend service and the fees they paid for it during periods of absence.

The essence of that part of the Judge's decision is that if the utility (here a trash company) allows a customer to suspend service, a mobile home park separately charging for the utility in that provider's service area must do the same. This is because section 33-1413.01 prohibits a park separately charging for utilities from charging more than the providing utility's single-family residential rate. If the utility allows a single-family to suspend service, then its rate for that period of time is zero and under those circumstances the park can charge no more than that - zero.

So far the Judge's decision was on solid ground. But then it went astray. The Judge determined that he had not authority to require the park to refund the overcharges to tenants. In lieu of this, and without advance notice to anyone he was considering such action, he imposed a $1,000 fine (called a civil penalty) against the park. So the decision printed by AAMHO was that tenants, though not eligible for refunds, could use the mobile home park hearing officer process to get large fines imposed against their landlords for unintentional good faith errors in calculating utility charges. This is rally unfortunate because the decision was wrong and following a rehearing the part dealing with refunds and imposition of a fine has been set aside.

A case was decided by the Arizona Court of Appeals more than a decade ago that expressly held that an Administrative Law Judge can order a park overcharging for utilities to refund amounts overcharged to tenants. If the Judge who imposed the fine had been aware of that case, the original decision would probably have been correct. If he had given the parties in the case notice he was considering that issue, he would have been made aware of the decision.

On rehearing, a new Administrative law judge was made aware of the Court of Appeals case. Based on that, she ordered the park to refund the overcharged trash fees to the tenants and vacated the fine. Since AAMHO printed the decision imposing the fine, it will be interesting to see if they print the decision vacating it.

Law Offices of Michael A Parham, 5333 North 7th Street, Suite B-213, Phoenix, Arizona 85014
Phone 602-265-6804, fax: 602-265-8945

Michael Parham is an attorney and has been the legal counsel for MHCA since 1987. He regularly teaches educational courses in residential and mobile home park landlord tenant law and Fair Housing Law. He is the author of numerous training manuals, including the Mobile Home Parks and Recreational Vehicle Parks Landlord Tenant Acts, Fair Housing laws, Americans With Disabilities, Abandonment Procedures, as well as the author of landlord tenant forms for MHCA. He has been a pro-tem Justice of the Pease since 1996. Michael represents owners of mobile home and recreational vehicle park communities.

*Article approved by Manufactured Housing Communities of Arizona