State Takes Action Against 2 Firms That List Rentals : Law: Real estate officials say Burbank and Glendale companies haven’t met requirements regarding contracts and refunds.
State real estate officials have filed allegations that could lead to the revocation of the licenses of two rental listing services in Burbank and Glendale that have been targets of dozens of lawsuits and consumer complaints.
Quality Rentals of Burbank and Properties Unlimited of Glendale failed to pay promised refunds and failed to obtain state approval of service contracts as required by law, according to an 11-page complaint by the California Department of Real Estate, which licenses rental listing services.
The licenses could be revoked after a hearing before an administrative law judge, said Steven J. Ellis, managing deputy commissioner for the department in Los Angeles.
“I’m going to get an attorney and I’m going to fight,” Vickie L. Cardoza, operator of Quality Rentals, said Wednesday. “There are a lot of clients out there . . . who have no problem with our service who are getting placed.”
Properties Unlimited operated in Glendale under a license issued to Roberta A. Cardoza, Vickie Cardoza’s mother, from 1993 until it closed last June. Vickie Cardoza then opened Quality Rentals on West Alameda Street in Burbank.
Though Vickie Cardoza said that the two firms have paid many refunds, dozens of customers have filed complaints in small claims court alleging their refunds were denied.
Rental services charge fees for lists of available houses and apartments. State officials said that over the years, the business has been a frequent source of consumer complaints, leading to state laws specifically aimed at the companies.
These laws require firms to refund all but a $25 service charge to clients who don’t find a suitable rental or who find one on their own. The refund pledge is to be included in customer service contracts that must be reviewed in advance by the real estate department.
Ellis said Quality Rentals and Properties Unlimited are but the latest to employ a familiar stratagem to skirt the rules.
The firms have charged $150 for their service, but have made customers sign two contracts. The first contract, which the companies submitted to the state, put the fee for rental listings at $50 and included the promise to refund all but $25.
The second contract--not submitted to the state--provided for a credit check costing a non-refundable $100. Dozens of customers said that when they sought refunds, they were either denied altogether or told they were eligible for only $25 under the first contract.
“It’s our position that they’re not . . . using an approved contract. They’re adding something to it,” Ellis said Wednesday. The bottom line is that customers are supposed to get back all but $25 “if the services don’t pan out.”
Vickie Cardoza said the credit check is performed by a separate company over which the real estate department lacks jurisdiction.
Moreover, she said, other operators do business the same way but have not been charged by the state.
“Where’s the consistency?” she asked. “If I can’t do it, then these other companies better not be doing it.”
Cardoza also said that in the wake of recent news reports and state scrutiny of her business, she has begun severing the listing service from the credit check. Now, she said, customers can buy rental listings for $75, or pay an additional $75 for the credit check as well.
Dated Feb. 6, the state complaint cites the cases of six customers--three from Quality Rentals and three from Properties Unlimited--who allegedly paid $150, found rentals independently, but were unable to get their money back.
In each case, the bulk of their fees was assigned to the “credit check” contract with the “ ‘no-refund clause’, . . . (which) was not submitted to the Department for approval,” the complaint said.
The companies’ practices “are grounds for the suspension or revocation of the . . . licenses and license rights,” the complaint said.
Vickie Cardoza said she ultimately paid refunds to all three of the Quality Rentals customers cited in the complaint--two of whom had sued her in small claims court.
The two companies, like other licensed rental listing firms, posted bonds to cover potential legal judgments. Department officials said customers who have won small claims judgments but have been unable to collect can request claim forms by calling (213) 897-3399, and specifying Bond/Cash Deposit Claim form RE 258 and 259.
