Question 1: What is the latest on the COVID-19 19 eviction restrictions? And what about the recent CDC order halting evictions?
Answer 1: As for the recent CDC (Centers for Disease Control and Prevention) order, nothing changed other than the extension of its effective date to January 31, 2021 from the end of December 2020. On December 27, 2020, the President signed into law the Consolidated Appropriations Act, 2021, Section 502 of which extends the expiration date of the CDC Order (titled, “Temporary Halt in Residential Evictions to Prevent the Spread of COVID-19”). The new expiration date is January 31, 2021 unless extended, modified, or rescinded. Section 502 does not make any changes to the September 4, 2020 CDC Order other than to extend its expiration date.
In brief, the Order temporarily halts residential evictions of covered persons for nonpayment of rent during September 4, 2020, through January 31, 2021. This means that a landlord or other person with a legal right to pursue an eviction or a possessory action cannot evict for nonpayment of rent any covered person from any residential property in any U.S. state or U.S. territory where the Order applies. The Order does not prohibit landlords from starting eviction proceedings, provided that the actual eviction of a covered person for non-payment of rent does NOT take place during the period of the Order.
The Order applies only in states that do not have in place a moratorium on residential evictions that provides the same or greater level of public-health protection than the CDC’s Order. While that issue requires resolution by appropriate courts, Governor Newsom has declared that the Order is not effective in California because state law – AB 3088 primarily – provides such greater protections. However, again, a court may take a different view depending on the facts presented. Unfortunately, by the time an appellate court issues a binding ruling on the issue, it is likely to be moot, other than, perhaps, a finding that a California landlord violated the Order and is thus liable to the tenant under the Order’s penalty provisions. Those penalties can be substantial – a person who violates the Order may be subject to a fine of no more than $100,000 or one year in jail, or both, if the violation does not result in death. A person violating the Order may be subject to a fine of no more than $250,000 or one year in jail, or both, if the violation results in a death.
For more detail on that Order, the CDC website provides an informative overview – https://www.cdc.gov/coronavirus/2019-ncov/downloads/eviction-moratoria-order-faqs.pdf
As for California state law, AB 3088 remains unchanged, though there are at least two proposals underway in the legislature to extend its provisions. One effort – AB15 (The Tenant Stabilization Act of 2021) –would extend AB 3088’s protections through 2021. Another – SB 3, (The Tenant, Homeowner, and Small Landlord Tenant Relief Act of 2021) – would extend the protections through March 31st, 2021, with opportunities to renew at certain intervals.
Finally, local governments continue to issue local laws meant to restrict evictions even further, primarily by limiting all evictions other than those for public health or safety reasons, or those based on the state Ellis Act. Those provisions remain subject to challenge that they are in most cases preempted by AB 3088, but that issue is being resolved practically case by case in the various county superior courts, and no clear trend appears as of yet.
Question 2: Is it legal to increase rent in Lake County?
Answer 2: Lake County, like every other California county, is subject to the COVID-19 related statewide State of Emergency, part of which imposes a limit of a maximum 10% rent increase, unless a higher amount is necessary based on the circumstances. Those circumstances include establishing proof that the greater increase is directly attributable to additional costs for repairs or additions beyond normal maintenance that “were amortized over the rental term that caused the rent to be increased greater than 10 percent”, or that an increase was contractually agreed to by the tenant prior to the proclamation or declaration. There is also the likely application of AB 1482, which limits most increases to the local inflation rate plus 5%. However, note that some cities and counties have even more strict limitations, so you need to check your city and county’s rules for such temporary increase limitations.
Question 3: I manage a recently purchased property (08/2020). The current rental agreement states that if the tenant pays their rent on or before the first of the month, they would be given a discount of $100.00. I want to end that part of the agreement and implement a $50.00 late fee if paid after the fifth of the month. Am I required to serve a 60-day notice for this change in terms for tenants who have been renting for over a year?
Answer 3: The length of tenancy, (over one year in this case), only affects rent increase notices and notices of termination. Rent increases of greater than 10% (unlikely, as discussed above) require 90 days’ notice, and termination notices go from 30 days to 60 days. Other changes in terms of the tenancy under Civil Code 827 still only require a 30-day notice.
Question 4: Two people have overdosed on heroin in the last month in one of my units. They also haven’t paid the rent in almost a year, claiming COVID-19. What form do I use to remove them within three days?
Answer 4: Any non-payment of rent case must be handled pursuant to the rules set out in AB 3088, which at minimum requires a 15-day notice, and which must include certain language and a declaration that allows the tenants to claim COVID-19 as the reason for the non-payment. The overdose aspect is subject to different rules, and would require a more nuanced evaluation before it can be determined whether a three-day notice to cure or to quit may be available.
Question 5: My tenants and I submitted to a rent board mediation in April regarding the tenants’ claims that there were problems with parts of the apartment warranting a rent reduction. We agreed in the mediation to a list of repairs that I would complete within a certain period of time. However, given the pandemic’s various impacts in getting repair persons to the unit, combined with the tenants’ unwillingness to fully cooperate with the process, the 90-day period passed without all of the repairs being made. The tenant’s attorney is now demanding that I agree to waive all the rent that accrued from the date of the mediation agreement until all the repairs are completed. I am so frustrated, but do not want to return the rent board or go to court. Any suggestions?
Answer 5: Anyone could appreciate your frustration, except perhaps your tenants and their attorney. However, despite your reluctance to return to the rent board, it would appear getting the rent board hearing officer who oversaw your mediation agreement involved might be the best course of action. That individual is likely in the best position to appreciate what efforts you have made to repair the specific items, and also, to provide the tenants’ attorney (hopefully) a reality check on his or her extreme demand that the rent be waived despite most of the repairs having been made, with the remainder likely to be provided as soon as circumstances permit. In the time of Covid-19, everyone has to be, generally, more flexible and understanding than perhaps they customarily are used to. And that’s on both sides. It is also easy to appreciate that the tenants may have genuine fears regarding entry by tradespeople into their home, and so their failure to cooperate may not just simply be unreasonable. However, again, hopefully the rent board hearing officer will be able to bridge the gap between the two sides. It happened once, it seems, and so it’s not at all unreasonable to think that person would be successful twice.
Question 6: Is it still possible to evict a tenant for lease violations in San Jose? The tenants have brought extra people and a pit bull to the unit.
Answer 6: State law does not prohibit evictions based on lease violations, other than nonpayment of rent, which cases are covered by the AB 3088 law passed in late August. Other lease violations can be processed through the standard unlawful detainer procedure starting with, generally, a 3-day notice to cure or quit. It appears that San Jose and Santa Clara County have concluded that the state law AB 3088 now applies, rather than the city and County’s prior eviction moratoria. Given that, it appears a 3-day notice for breach of the lease procedure is now available in Santa Clara County and San Jose itself. However, there are many more questions in any eviction action these days, so you will need to consult with a person, probably an attorney, knowledgeable about the local legal environment.
Question 7: I have a tenant who has not paid rent for November or December. Today for the first time, they emailed the declaration form that they can’t pay rent because of COVID. No rents have been paid. It is my understanding that 25% is to be paid each month and that the declaration should be given before the rent is due each month. What should I do next? What are my rights as a property manager?
Answer 7: A tenant who returns the COVID declaration for any month from September through January has until the end of January to pay 25% of the rent for any month in which the tenant submitted the declaration. You may serve a 15-day notice for any month in which the tenant has not paid the complete rent, or you can wait until January and serve one that covers each such month. As to your ‘rights’ as a property manager, I assume you mean the right to enforce the lease, including serving notices and filing an unlawful detainer. If so, that will likely depend on the lease with the tenant, and any property management agreement you have with the property owner.
Question 8: Recently, my insurance carrier informed me after an on-site inspection that I need to have tenants remove or relocate charcoal BBQ grills at least 10 ft away from buildings and off balconies. In SF, many apartments, including ours, have a small balcony outside and tenants have a small grill to BBQ. There is not 10 ft to move the grill, so does that mean we have to tell them to remove the grill? If tenants have been enjoying the ability to BBQ on their balcony for years, can the tenant make the case that we are somehow taking away a tenant benefit or impeding on their rights? If I did want to inform the tenants about this new rule, would I just do a 30-day notice informing them about this change due to fire safety risks? Thanks in advance for your help!
Answer 8: That is a dilemma. But, if your carrier is telling you something that you have to do for building safety, then you likely have no choice but to comply. You would need to serve the tenants with a 30-day notice of change in terms of tenancy, although arguably you could ask them to expedite that change for building safety. You might reach out to your insurance company agent and ask if the tenants can have gas-fired grills, as opposed to charcoal grills, or if all such flammable items are banned from small decks. If the tenants can have a gas grill, you might offer to split the cost with them of a small replacement grill, and everybody can avoid the hassle of a red board hearing etc. If you are required to remove the grill, that would likely be a reduced housing service, although you would have ‘just cause’ to do so, and it then would be up to the tenants to seek a rent reduction by petitioning the rent board, unless you and they could agree on something without having the rent board be involved.
Question 9: My wife and I need to sell our current residence and plan to return to our previous home in San Anselmo in February, now rented out on a month-to-month basis. We of course need to tell the current tenants they need to move. That rental is in our LLC, with my wife and I the sole partners in that LLC. Does the single-family home exemption of AB 3088 still apply? We recall reading one of your prior articles that SFDs held by LLC may not be exempt?
Answer 9: As long as your wife or you do not hold title as a corporation, the exemption probably applies – “A limited liability company in which at least one member is a corporation” is the disqualifier. However, even if the rental was covered by the statewide law AB 3088, ‘owner move in’ is a ‘just cause’ ground that would allow you to proceed. You would need to offer the tenants a one month rent waiver, as the required relocation benefit, but other than that (and subject to Covid-19 local eviction moratoria), you would be able to act on your plan to terminate the tenancy and return to your home.
Question 10: What cannot be deducted from the security deposit?
Answer 10: Civil Code Section 1950.5 governs security deposit deductions, which are allowed for the following items or categories:
(1) The compensation of a landlord for a tenant’s default in the payment of rent.
(2) The repair of damages to the premises, exclusive of ordinary wear and tear, caused by the tenant or by a guest or licensee of the tenant.
(3) The cleaning of the premises upon termination of the tenancy necessary to return the unit to the same level of cleanliness it was in at the inception of the tenancy. The amendments to this paragraph enacted by the act adding this sentence shall apply only to tenancies for which the tenant’s right to occupy begins after January 1, 2003.
(4) To remedy future defaults by the tenant in any obligation under the rental agreement to restore, replace, or return personal property or appurtenances, exclusive of ordinary wear and tear, if the security deposit is authorized to be applied thereto by the rental agreement.
I strongly recommend that anyone who rent units to residential tenants read Civil Code Section 1950.5 in its entirety, because it is useful to know the details of the security deposit law in detail.
Richard Beckman, of Beckman Feller & Chang P.C., has been practicing landlord-tenant law for over 26 years, primarily in rent-controlled jurisdictions such as San Francisco, Oakland and Berkeley. He represents clients in a broad range of real estate-related disputes, including partition of co-ownership interests, purchase contract disputes, insurance coverage analysis and land use. Mr. Beckman also specializes in all aspects of landlord-tenant issues, representing landlords and tenants in residential and commercial matters. He can be reached at 510-548-7474; email [email protected] or by visiting the website www.bfc-legal.com.